Every minute, the United States adds more national debt, usually over a million dollars. Have you ever come across the U.S. National Debt Clock online?
You may have noticed how fast those numbers roll over. So what do the numbers mean? Why is the debt rising so fast, and do we need to be alarmed?
We are going to look into all you want to know about the U.S. national debt, what it is, why it's growing, and if it's sustainable or not.
What Is the U.S. National Debt?
The U.S. national debt is the total amount of money owed by the nation to its creditors. It is a consequence of the government spending more money than it receives over a span of several years.
Each year, if the government receives less in taxes and other revenues than it spends on programs and services, it has to borrow money to finance the difference. These year-by-year deficits collectively form the national debt in the long term.
Picture a family that every month spends more than it earns and covers the gap by credit cards or borrowing. The U.S. federal government does the same on a much greater scale, trillions of dollars.
How Fast Is the US Debt Growing?
By the year 2025, the U.S. national debt will total over $38 trillion. The number is so large that it might be hard to comprehend.
What one might say to try and put into context is seeing just how quickly it's growing on the live action. The debt increases by more than $60,000 every second. That's roughly $1 trillion added every 5 to 6 months. .
These figures always fluctuate, but they illustrate how rapidly the debt is increasing. It is similar to watching an odometer in a taxi climb faster than you can count, except this one never gets to the end.
Why Does the US Keep Borrowing Money?
America still borrows because it keeps on spending more than it collects. Much of what the government spends goes into huge programs such as Social Security, Medicare, Medicaid, and the military.
They are services that millions of people need, for example, retired people, war veterans, and low-income families. To that, the government also pays interest on the money borrowed.
During crises, for example, economic recessions, wars, or health crises like the COVID-19 pandemic, the government will spend even more to stabilize the economy. Unless taxes are increased to fund that extra spending, borrowing is the only option.
Who Does the Government Borrow From?
When the government of the United States borrows money, it does that through issuing Treasury securities, essentially IOUs. These securities are purchased by nearly every kind of investor on the planet, such as regular people, banks, investment portfolios, and foreign countries.
Countries like Japan and China are some of the largest foreign holders of U.S. debt because they view Treasury bonds as good and sound investments.
No surprise, the U.S. government also borrows from itself in a way, for example, as agencies like the Social Security Administration buy and hold Treasury securities when they have surplus funds.
In the end, the national debt is owned by a mix of domestic and foreign lenders who believe that the U.S. will continue to make payments on its debt.
Is Debt Always a Bad Thing?
Debt is not necessarily evil. It is a sound financial move if it is done to invest in something that will cause the economy to grow, like infrastructure, research, or education. If the government, for example, borrows to invest in clean energy or highways, it could generate jobs and cause productivity to rise.
Similarly, during economic recessions, borrowing makes sure that money still flows in the system so that people can still be employed and businesses can still be operational. The issue only becomes a problem when borrowing is excessive and is not matched by equivalent growth in the economy.
Just like a person who runs up too much debt on their credit cards with no way of paying it back, a country can get into trouble if it keeps borrowing without consideration for the long-term consequences.
What Is the Debt-to-GDP Ratio?
Debt management in any country is measured against the country's annual GDP (Gross Domestic Product), which sums everything made in the country during a year. This is termed the debt-GDP ratio.
If it is approximately 100%, the country owes that much against its generation in a year. The U.S. debt-GDP ratio stands at approximately 122% to 124%, which means it owes much, much more than it earns.
That is not to say that the country is staring at imminent doom, but it is a message that the relative debt is exceedingly large, given the size of the economy, and might pose some challenges in the near future.
Can the US Keep Up With This National Debt?
Currently, America can continue to hold on to debt because it is still one of the strongest and most dependable creditors globally. U.S. Treasury bonds are still bought by investors, and the government continues to pay interest on time.
The dollar is also the reserve currency of the globe, which all helps give confidence to the world in America's fiscal strength. But if the debt continues to grow at this pace, the government will increasingly need to spend huge sums of money just to pay it off.
That could leave less money to devote to schools, healthcare, roads, and other essential services. Too much debt could eventually even restrict the government's ability to respond to a new crisis.
What Can Be Done About the U.S. National Debt?
It doesn't require an accountant to recognize that lowering the national debt isn't easy but is achievable. The government would need to increase the money it brings in, lower spending, or both.
That could be done by increasing tax rates, reducing money allocated to some programs, or doing something to make the economy grow faster so that the government brings in more without raising tax rates.
Of course, everything has trade-offs, and those are usually politically uncomfortable. No one wants their taxes to increase or their favorite programs to be eliminated, but if they don't do something, the debt will just continue to rise and potentially cause more problems down the road.
Final Thoughts
The national debt of the United States is fast climbing by over a million dollars every minute; however, the real stories of how governments manage money, respond to crises, and reconcile short-term needs with long-term aims are far more complex.
The debt level is high, but the U.S. remains, for now, a financially strong nation. Still, we need to understand what the money is being used for and the implications for the future.
The takeaway here: debt is not always a bad thing, only when it is rising too fast and is not covered by growth or good fiscal planning does it become a concern. As citizens, understanding how national debt works equips us to better understand the problems our country is facing, and the hard choices before us.
FAQs
1. Why should ordinary citizens be concerned with national debt?
The national debt touches everybody to some extent. If it gets too huge, it can potentially lead to higher taxes, less money for important programs, or less economic growth. Additionally, a high amount of debt is essentially more of what goes toward interest as compared to items such as schools, highways, or healthcare. Thus even though it seems far off, it can impact everyday life considerably in the long term.
2. To whom does the U.S. owe?
The United States has a wide creditor base. They include foreign countries like China and Japan, U.S. citizens and banks that buy Treasury bonds, and government agencies like Social Security that invest in government securities. That is, part of the debt is "owed to ourselves."
3. How deeply is America in debt now?
The American national debt is approximately $36.5 trillion as of April 2025. That amount constantly updates and increases by more than $1 million each minute, depending on how much it is spending as a government versus how much it is borrowing.
4. Is national debt bad for the economy?
Not necessarily. Debt can be good if it is spent on something that makes the economy bigger, like education or buildings. Excessive debt, however, can be ill if interest payments get too high, or if lending grows faster than the economy. It's all about balance and how competently the debt is managed.