Treasury Secretary Steven Mnuchin walks past a display of the U.S. national Debt as he testifies to the House Financial Services Committee on "The Annual Report of the Financial Stability Oversight Council," on Capitol Hill in Washington. The U.S. debt is about $19.9 trillion and is constantly changing; it amounts to:
$61,365 for every person living in the U.S.
$158,326 for every household in the U.S.
106 percent of the U.S. gross domestic product
560 percent of annual federal revenues
Much of the debt is bought and held by individuals, institutional investment companies and foreign governments. The debt is managed by the U.S. Treasury through its Bureau of the Public Debt. The debt falls into two categories: intragovernmental holdings and debt held by the public.
What Is the Budget Deficit?
When the government spends more in a given fiscal year than it brings in through revenues, it runs a deficit. It’s the same as when a person spends more than he or she has in the bank, except private citizens do not have as much freedom to keep a running tab. Running a deficit for a long time can be a bad thing for the country because the interest on borrowed money continues to accrue, exacerbating the long-term debt. The deficit usually increases when the nation is financing a war or is experiencing a recession, but at other times as well since the greater the National Debt, the greater the interest on that debt becomes.
The highest deficit of GDP was in 1944, at 21.2 percent during World War II; it remained below 3 percent of GDP for most of the nation’s history and was 3.5 percent in 2016. In order for the government to correct a budget deficit, it needs to cut back on expenditures or increase revenue through a hike in income taxes or fees. Another way the deficit can be reduced is by increasing the growth rate of the economy. The projected U.S. federal budget deficit for fiscal year 2018 is $352 billion.