Debt
U.S. Debt: Visualizing the $31.4 Trillion Owed in 2023
U.S. Debt: Visualizing the $31.4 Trillion Owed in 2023
Can you picture what $31.4 trillion looks like?
The enormity of U.S. government debt is hard for the average person to wrap their head around. For instance, compared to the median U.S. mortgage, the current level of federal debt is 230 million times larger.
In this graphic, Julie Peasley shows how many one-dollar bills it would take to stack up to the total U.S. debt of $31.4 trillion.
How Did U.S. Debt Get So High?
U.S. national debt is how much money the federal government owes to creditors. When the government spends more than it earns, it has a budget deficit and must issue debt in the form of Treasury securities.
The U.S. has run a deficit for the last 20 years, substantially increasing the national debt. In fact, according to the Department of the Treasury, the current debt is $31.4 trillion.
Stacked up in one-dollar bills, the U.S. debt would be equivalent to almost eight of Chicago’s 110-story Willis Tower.
Year | Outstanding Debt | Year-Over-Year Increase |
---|---|---|
2023* | $31.4T | 2% |
2022 | $30.9T | 9% |
2021 | $28.4T | 6% |
2020 | $26.9T | 19% |
2019 | $22.7T | 6% |
2018 | $21.5T | 6% |
2017 | $20.2T | 3% |
2016 | $19.6T | 8% |
2015 | $18.2T | 2% |
2014 | $17.8T | 6% |
2013 | $16.7T | 4% |
2012 | $16.1T | 9% |
2011 | $14.8T | 9% |
2010 | $13.6T | 14% |
2009 | $11.9T | 19% |
2008 | $10.0T | 11% |
2007 | $9.0T | 6% |
2006 | $8.5T | 7% |
2005 | $7.9T | 8% |
2004 | $7.4T | 9% |
2003 | $6.8T | 9% |
2002 | $6.2T | 7% |
2001 | $5.8T | 2% |
2000 | $5.7T | 0% |
Source: Fiscal Data. Debt for 2023 is as of January, with the year-over-year increase reflecting the growth from October 2022 to January 2023. October is the start of the fiscal year for the U.S. government. Debt includes both debt held by the public and intragovernmental holdings.
The last time the government had a surplus was in 2001, when debt rose only 2% due to interest costs. Since then, the largest jumps in U.S. debt have been during the Global Financial Crisis—which saw three straight years of double-digit growth rates—and in 2020 due to trillions of dollars of COVID-19 stimulus.
U.S. federal debt rises during recessions because government revenue, primarily composed of taxes, decreases. At the same time, the government increases spending to help stimulate an economic recovery.
And in today’s case, the U.S. is facing additional financial issues. As the country’s senior population grows and people live longer, this puts pressure on programs that serve older Americans such as Social Security. Healthcare is becoming more expensive and is the second-fastest growing part of the U.S. budget.
The Pros and Cons of Debt
U.S. debt helps fund critical programs for Americans, including retirement and disability benefits, healthcare, economic security, and national defense.
As one example of the impact of these programs, income security nearly halved the percent of the population living below the poverty line in 2019 from 22.8% to 12.2%.
Of course, U.S. debt also comes with challenges. A chief concern is the ability to pay the interest costs on U.S. debt, especially as interest rates rise.
Before rate hikes began, interest costs amounted to 6% of the U.S. budget in the 2021 fiscal year. Fast forward to December 2022, and interest costs amounted to 15% of total government spending since the start of the fiscal year in October.
Addressing the Problem
In January 2023, the U.S. hit its debt ceiling, also known as its borrowing limit. While some countries tie their debt to GDP, the U.S. sets an exact limit in dollar terms.
The government would run out of money to pay its debts this summer if the ceiling is not raised, though policymakers have historically agreed to debt ceiling increases in the past to avoid a default. In 2011, the U.S. narrowly avoided default due to a last-minute debt ceiling negotiation and the country’s credit rating was downgraded as a result.
Tackling U.S. debt is simple in theory: raise taxes or the debt limit, reduce spending, or a combination of all three. However, it’s much more difficult in practice. Which taxes should be raised? Which programs should be cut? What happens the next time the debt limit is reached?

This article was published as a part of Visual Capitalist's Creator Program, which features data-driven visuals from some of our favorite Creators around the world.
Markets
Charting the Rise of America’s Debt Ceiling
By June 1, a debt ceiling agreement must be finalized. The U.S. could default if politicians fail to act—causing many stark consequences.

Charting the Rise of America’s Debt Ceiling
Every few years the debt ceiling standoff puts the credit of the U.S. at risk.
In January, the $31.4 trillion debt limit—the amount of debt the U.S. government can hold—was reached. That means U.S. cash reserves could be exhausted by June 1 according to Treasury Secretary Janet Yellen. Should Republicans and Democrats fail to act, the U.S. could default on its debt, causing harmful effects across the financial system.
The above graphic shows the sharp rise in the debt ceiling in recent years, pulling data from various sources including the World Bank, U.S. Department of Treasury, and Congressional Research Service.
Familiar Territory
Raising the debt ceiling is nothing new. Since 1960, it’s been raised 78 times.
In the 2023 version of the debate, Republican House Majority Leader Kevin McCarthy is asking for cuts in government spending. However, President Joe Biden argues that the debt ceiling should be increased without any strings attached. Adding to this, the sharp uptick in interest rates have been a clear reminder that rising debt levels can be precarious.
Consider that historically, interest payments on the U.S. debt have been equal to about half the cost of defense. More recently, however, the cost of servicing the debt has risen, and is now almost on par with the defense budget as a whole.
Key Moments In Recent History
Over history, raising the debt ceiling has often been a typical process for Congress.
Unlike today, agreements to raise the debt ceiling were often negotiated faster. Increased political polarization over recent years has contributed to standoffs with damaging consequences.
For instance, in 2011, an agreement was made just days before the deadline. As a result, S&P downgraded the U.S. credit rating from AAA to AA+ for the first time ever. This delay cost an estimated $1.3 billion in extra costs to the government that year.
Before then, the government shut down twice between 1995 and 1996 as President Bill Clinton and Republican House Speaker Newt Gingrich went head-to-head. Over a million government workers were furloughed for a week in late November 1995 before the debt limit was raised.
What Happens Now?
Today, Republicans and Democrats have less than two weeks to reach an agreement.
If Congress doesn’t make a deal the result would be that the government can’t pay its bills by taking on new debt. Payment for federal workers would be suspended, certain pension payments would get stalled, and interest payments on Treasuries would be delayed. The U.S. would default under these conditions.
Three Potential Consequences
Here are some of the potential knock-on effects if the debt ceiling isn’t raised by June 1, 2023:
1. Higher Interest Rates
Typically investors require higher interest payments as the risk of their debt holdings increase.
If the U.S. fails to pay interest payments on its debt and gets a credit downgrade, these interest payments would likely rise higher. This would impact the U.S. government’s interest payments and the cost of borrowing for businesses and households.
High interest rates can slow economic growth since it disincentivizes spending and taking on new debt. We can see in the chart below that a gloomier economic picture has already been anticipated, showing its highest probability since 1983.
Historically, recessions have increased U.S. deficit spending as tax receipts fall and there is less income to help fund government activities. Additional fiscal stimulus spending can also exacerbate any budget imbalance.
Finally, higher interest rates could spell more trouble for the banking sector, which is already on edge after the collapse of Silicon Valley Bank and Signature Bank.
A rise in interest rates would push down the value of outstanding bonds, which banks hold as capital reserves. This makes it even more challenging to cover deposits, which could further increase uncertainty in the banking industry.
2. Eroding International Credibility
As the world’s reserve currency, any default on U.S. Treasuries would rattle global markets.
If its role as an ultra safe asset is undermined, a chain reaction of negative consequences could spread throughout the global financial system. Often Treasuries are held as collateral. If these debt payments fail to get paid to investors, prices would plummet, demand could crater, and global investors may shift investment elsewhere.
Investors are factoring in the risk of the U.S. not paying its bondholders.
As we can see this in the chart below, U.S. one-year credit default swap (CDS) spreads are much higher than other nations. These CDS instruments, quoted in spreads, offer insurance in the event that the U.S. defaults. The wider the spread, the greater the expected risk that the bondholder won’t be paid.
The US now has higher credit risk than Mexico, Greece, and Brazil pic.twitter.com/je4klBvHZ6
— Genevieve Roch-Decter, CFA (@GRDecter) May 11, 2023
Additionally, a default could add fuel to the perception of global de-dollarization. Since 2001, the USD has slipped from 73% to 58% of global reserves.
Since Russia’s invasion of Ukraine led to steep financial sanctions, China and India are increasingly using their currencies for trade settlement. President of Russia Vladimir Putin says that two-thirds of trade is settled in yuan or roubles. Recently, China has also entered non-dollar agreements with Brazil and Kazakhstan.
3. Financial Sector Turmoil
Back at home, a debt default would hurt investor confidence in the U.S. economy. Coupled with already higher interest rates impacting costs, financial markets could see added strain. Lower investor demand could depress stock prices.
Is the Debt Ceiling Concept Flawed?
Today, U.S. government debt stands at 129% of GDP.
The annualized cost of servicing this debt has jumped an estimated 90% compared to 2011, driven by increasing debt and higher interest rates.
Some economists argue that the debt ceiling helps keep the government more fiscally responsible. Others suggest that it’s structured poorly, and that if the government approves a level of spending in its budget, that debt ceiling increases should come more automatically.
In fact, it’s worth noting that the U.S. is one of the few countries worldwide with a debt ceiling.
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