United States government debt, also referred to as the national debt or United States total public debt, is the amount of money owed by United States federal government to holders of U.S. debt instruments.

The total Public debt includes state and federal debts which is owed to corporations, individuals and foreign governments. But, this debt excludes all social security debts and intra-governmental obligations.

Some of the federal securities held by the public include Bonds, Treasury Bills, United States Savings Bonds, Notes, TIPS and State and Local Government Series securities.

External debt includes debts which both the public and private sectors owe to foreign people and organizations. Foreign ownership of public debt is a substantial part of the total national debt.

When U.S. federal debt passed the trillion mark on 30th September 2008, public debt stood at .3 trillion.

Further debts included Social Security obligations, Medicare, Medicaid and others.

A division of United States Department of the Treasury, the Bureau of the Public Debt, calculates the amount of money owed by the government daily.

Budgeted and non-budgeted spending has pushed total debts upward by around 0 billion each year since 2003. The budget deficit fell from 8 billion in 2005 to 2 billion in 2007, but moved sharply up again to 5 billion in 2008.

There have been regular warnings from the U.S. Treasury Department, Office of Management and Budget (OMB), and the Government Accountability Office (GAO) that debt levels are sure to increase dramatically due to social programs like Medicare, Social Security, Medicaid and interest owed on outstanding debts.

There are estimates that benefits under entitlement programs could exceed government income by more than trillion in the next half century.

If the changes which they propose are not done, some experts claim that federal expenditures could surpass federal tax revenues by sizable margins in a shorter period than that.

Public debts have been a part of its existence since the United States of America came into being.

The first reported value of public debt was ,463,476.52 on January 1, 1791. This was a combination of debts that were incurred during the American Revolutionary War and the creation and implementation of the Articles of Confederation.

Debt continued to increase over the next half-century.

It was brought down to zero for a short period in early January, 1835.

After that, the debts just kept increasing.

The Civil War in America was responsible for a huge surge where debts rose from million in 1860 to more than billion in 1863.

The following year, it stood at .7 billion.

There were a few fluctuations during the rest of the century. But, strong economic growth was recorded through most of the period from 1800 to 1912.

Then, debts started increasing again. It was around billion during the 1920s, the World War I period.

History repeated itself and debts grew to an alarming 0 billion by the end of World War II from a figure around billion in 1940.

Public debt and inflation soared in tandem during the nineteen-eighties. The nineties saw the debts increase by about two hundred percent within a decade.

Better results were achieved towards the close of the century.

But, debts then started climbing quickly again.

Public debt stood at about .9 trillion at the end of 2005. This was about 8.7 times the level of public debt in 1980.

For the greater part of the last half-century, America had enforced a debt ceiling. The Treasury could issue as much debt as the government required as long as it was within the specified ceiling.

Over time, the United States Congress passed new laws which caused fairly regular increases in the level of the ceiling.

Congress increased the debt limit to .815 trillion in September 2007.

In July 2008, the ceiling was again raised to .6 trillion with the passing of new laws to accommodate the bailout of mortgage giants, Freddie Mac and Fannie Mae.

Congress used to approve legislation for each debt issuance. It was decided that this was no longer possible because of the growth of fiscal operations in the twentieth century.

As debt is spiraling out of control you can take action and survive, and create your own personal financial security.

Public debts are of two main types:

1. Marketable and Non-marketable securities held by the public

2. Securities held by government accounts

Public debt holders cover a huge group of people that owning bills, notes and bonds.

The U.S. Treasury regularly publishes data providing information about the holders.

The foreign and international holders of the debt are also put together from the notes, bills, and bonds sections.

More than half of the total national debt is owed to the Federal Reserve and intergovernmental holdings.

According to reported figures of the US government in September 2008, it has supported its obligations to bailout home mortgage companies of Freddie Mac and Fannie Mae through the Housing and Economic Recovery Act of 2008.

The balance sheet obligations of these two companies are over trillion. The Government does not account for these obligations in its current balance sheet.

The U.S. Treasury contracted to receive US$ 1 billion dollars in senior preferred shares and a warrant for 79.9% of common shares from each of these Government Sponsored Enterprises or GSEs.

This was done to maintain adequate capital ratios in the enterprises and ensure essential solvency. This is, effectively, nationalization of the companies.

Some people claim that some of these US governmental actions place taxpayers’ funds at some risk. The effects of the takeovers may not be predictable immediately. The overall picture will probably only come into focus later.

At the time of the takeover, more than 98% of Fannie’s loans were being repaid in a timely manner.

Both these companies are claimed to have had a positive net worth where their assets were valued much higher than their liabilities.

The Congressional Budget Office has directed incorporation of the assets and liabilities of these two companies into the federal budget. This shows the extent of governmental control over these entities.

Presently, foreign governments are said to have about 25% holding of total US debt.

This figure was about 13% in 1988.

US Treasury statistics indicate foreigner organizations and individuals held 44% of federal debt held by the public in 2006. Two-thirds of this was held by central banks of countries like China and Japan.

Although there was a fall in such investments in 2007 due to the depreciating value of the US dollar at the time, but foreign investors continued investing in US-dollar–denominated instruments.

This exposure is claimed by some to pose a threat of some scale to the US economy.

If the foreign investors start selling Treasury securities or stop purchasing them, some people claim that it might cause significant losses.

It seems that such losses may be a very unlikely situation but the possible effects from such a theoretical situation becoming reality must be considered when decisions are being made.

Central banks of Sweden, Russia, Italy and the United Arab Emirates reduced their dollar holdings marginally in 2006.

Kuwait and Syria discontinued pegging their currency exclusively to the dollar in 2007.

These occurrences may not be pointers to what could happen in the future.