democracy is a work in progress

National Debt

Problem Brief

Sources2020-05-20T09:40:13-05:00

Sources

Ross Perot, “Balancing the Budget and Reforming Government”, 1992 campaign infomercial, https://www.youtube.com/watch?v=mPIVI0CbCmg, accessed Aug 7, 2019

Peter G. Peterson Foundation, “Debt & Deficit: Our Work”, https://www.nationalpriorities.org/works-on/debt-deficit/

Peter G. Peterson Foundation, “WHY YOU SHOULD CARE THAT 2017 TAX CUTS WILL ADD TO THE NATIONAL DEBT”, Dec 20, 2017, https://www.pgpf.org/blog/2017/11/why-you-should-care-that-tax-cuts-add-to-the-national-debt

Peter G. Peterson Foundation, “A Strong Fiscal Foundation for Economic Growth”, https://www.pgpf.org/multimedia/a-strong-fiscal-foundation-for-economic-growth (good basic video)

Peter G. Peterson Foundation, “Long-Term Debt: An Unsustainable Future”, http://visualize.pgpf.org.s3-website-us-east-1.amazonaws.com/long-term-debt/  (very good presentation with nice interactive that allows comparison of plans for controlling debt)

Scott A. Wolla, “Choices are Everywhere: Why Can’t We Just Have It All?”, FRED, January 2013, https://research.stlouisfed.org/publications/page1-econ/2013/01/01/choices-are-everywhere-why-cant-we-just-have-it-all/

Matt Phillips, “The Long Story of U.S. Debt, From 1790 to 2011, in 1 Little Chart”, The Atlantic, Nov 13, 2012, https://www.theatlantic.com/business/archive/2012/11/the-long-story-of-us-debt-from-1790-to-2011-in-1-little-chart/265185/

Leonard E. Berman, “Which Presidents Spent the Most?”, Tax Policy Center, Nov 2, 2012, http://www.taxpolicycenter.org/taxvox/which-presidents-spend-most-you-might-be-surprised

Congressional Budget Office, Data Underlying Figures spreadsheet, “An Update to the Budget and Economic Outlook: 2019-2029”, Congressional Budget Office, Aug 21, 2019, https://www.cbo.gov/publication/55551

CBO, The Budget and Economic Outlook: 2018 to 2028, Apr 9, 2018, https://www.cbo.gov/publication/53651

CBO, Infographic: The Federal Budget in 2017, March 2018, https://www.cbo.gov/publication/53624

Inside Gov, 2017 United States Budget Estimate, no date, http://federal-budget.insidegov.com/l/120/2017-Estimate

Wikipedia, “National Debt of the United States: Debt Holdings”, https://en.wikipedia.org/wiki/National_debt_of_the_United_States#Debt_holdings

David Gelles, “They’re Rich and They’re Mad About Taxes (Too Low!)”, NY Times, Feb 12, 2019, https://www.nytimes.com/2019/02/12/business/rich-people-against-tax-cut.html, accessed Mar 27, 2019

Binyamin Applebaum, “The Federal Debt Is Rising. Concern Is Not.”, Feb 19, 2019, https://www.nytimes.com/2019/02/15/us/politics/national-debt-trump.html, accessed Apr 1, 2019

Data

Congressional Budget Office, “The Federal Budget in 2018: An Infographic”, Jun 18, 2019, https://www.cbo.gov/publication/55342, accessed Jul 19, 2019

Congressional Budget Office, “Updated Budget Projections: 2019 to 2029”, Table 1, May 2019, www.cbo.gov/publication/55151, accessed Aug 18, 2019

US Treasury Department, “Monthly Statement of the Public Debt of the United States: December 31, 2018”, https://www.treasurydirect.gov/govt/reports/pd/mspd/2018/opds122018.pdf, accessed Jul 2019

US Treasury Department, The Daily History of the Debt Results, https://www.treasurydirect.gov/NP/debt/search?startMonth=12&startDay=31&startYear=2018&endMonth=&endDay=&endYear=, accessed Aug 18, 2019

BEA News Release, “National Income and Product Accounts – Gross Domestic Product, Second Quarter 2019 (Advance Estimate) and Annual Update”, pg. 14 Table 7, US Bureau of Economic Analysis, Jul 26, 2019, https://www.bea.gov/system/files/2019-07/gdp2q19_adv_1.pdf, accessed Aug 18, 2019

Office of Management and Budget, Historical Tables: Table 7.1—Federal Debt at the End of Year: 1940-2021, https://obamawhitehouse.archives.gov/omb/budget/Historicals, accessed Apr 9, 2018

FRED, Federal Debt: Total Public Debt as a Percentage of Gross Domestic Product (GDP), https://fred.stlouisfed.org/series/GFDEGDQ188S

FRED, Federal Surplus or Deficit [-] as Percent of Gross Domestic Product,

https://fred.stlouisfed.org/series/FYFSDFYGDP

FRED, Federal Debt: Total Public Debt, expressed in trillions of dollars: https://fred.stlouisfed.org/graph/fredgraph.png?g=jeY2, expressed as percentage change from prior year: https://fred.stlouisfed.org/graph/fredgraph.png?g=jeYa

Definitions

Kimberly Amadeo, “Public Debt With Its Pros and Cons”, The Balance, updated Feb 13, 2019, https://www.thebalance.com/what-is-the-public-debt-3306294, accessed Jun 2019

Will Kenton, “Debt-to-GDP Ratio Definition”, Investopedia, updated Apr 17, 2019, https://www.investopedia.com/terms/d/debtgdpratio.asp, accessed Jun 2019

Kathy Ruffing, James R. Horney, and Paul N. Van De Water, “Fiscal Commission Should Not Focus on Gross Debt”, Center on Budget and Policy Priorities, Jul 22, 2010, https://www.cbpp.org/research/fiscal-commission-should-not-focus-on-gross-debt, accessed Jun 2019

Debt Threshold

The Economist, “How much is too much?”, Jun 3, 2015, https://www.economist.com/blogs/freeexchange/2015/06/public-debt

The Economist, “Debt and Growth: Breaking the Threshold”, Mar 1, 2014, https://www.economist.com/news/finance-and-economics/21597933-new-research-suggests-debts-trajectory-affects-growth-more-its-level-breaking 5

Jonathan D. Ostry, Atish R. Ghosh, and Raphael Espinoza, “When Should Public Debt Be Reduced?”, International Monetary Fund, June 2015, http://www.imf.org/en/Publications/Staff-Discussion-Notes/Issues/2016/12/31/When-Should-Public-Debt-Be-Reduced-42931

Andrea Pescatori, Damiano Sandri, and John Simon, “Debt and Growth: Is There a Magic Threshold?”, International Monetary Fund, February 2014, https://www.imf.org/en/Publications/WP/Issues/2016/12/31/Debt-and-Growth-Is-There-a-Magic-Threshold-41352

Thomas Grennes, Mehmet Caner, and Fritzi Koehler-Geib, “Finding the Tipping Point — When Sovereign Debt Turns Bad”, The World Bank, Aug 2010, https://elibrary.worldbank.org/doi/abs/10.1596/1813-9450-5391, abstract accessed Jun 19, 2019

Anis Chowdhury, “Is there an optimal debt-to-GDP ratio?”, VoxEU.org, Nov 9, 2010, https://voxeu.org/debates/commentaries/there-optimal-debt-gdp-ratio, accessed Jun 15, 2019

Lee, Sokbae et al., “Testing for a Debt-Threshold Effect on Output Growth.” Fiscal studies vol. 38,4 (2017): 701-717. https://onlinelibrary.wiley.com/doi/full/10.1111/1475-5890.12134, accessed Jun 24, 2019.

The 90% Question

Carmen M. Reinhart, Kenneth S. Rogoff, “Growth in a Time of Debt”, NBER Working Paper No. 15639, January 2010, Revised December 2011, http://www.nber.org/papers/w15639

Laurent Belsie, “Growth in a Time of Debt”, NBER Digest, no publication date, http://www.nber.org/digest/apr10/w15639.html

John Cassidy, “The Reinhart and Rogoff Controversy: A Summing Up”, The New Yorker, Apr 26, 2013, https://www.newyorker.com/news/john-cassidy/the-reinhart-and-rogoff-controversy-a-summing-up

The Economist, “The 90% question”, Apr 20, 2013, https://www.economist.com/news/finance-and-economics/21576362-seminal-analysis-relationship-between-debt-and-growth-comes-under

Balázs Égert, “The 90% public debt threshold: the rise and fall of a stylized fact”, 2015, Applied Economics, 47:34-35,3756-3770, DOI: 10.1080/00036846.2015.1021463

Modern Monetary Theory

Milton Ezrati, “What is Modern Monetary Theory?”, Forbes, May 28, 2019, https://www.forbes.com/sites/miltonezrati/2019/05/28/what-is-modern-monetary-theory/#6aefe9fd3186, accessed Aug 20, 2019

The Economist, “Is modern monetary theory nutty or essential?”, Mar 14, 2019, https://www.economist.com/finance-and-economics/2019/03/14/is-modern-monetary-theory-nutty-or-essential, accessed Aug 20, 2019

Peter Coy, Katia Dmitrieva, and Matthew Boesler, “Warren Buffett Hates It. AOC Is for It. A Beginner’s Guide to Modern Monetary Theory”, Bloomberg Businessweek, Mar 21, 2019, https://www.bloomberg.com/news/features/2019-03-21/modern-monetary-theory-beginner-s-guide, accessed Aug 20, 2019

Dylan Matthews, “Modern Monetary Theory, explained”, Vox, Apr 16, 2019, https://www.vox.com/future-perfect/2019/4/16/18251646/modern-monetary-theory-new-moment-explained, accessed Jun 24, 2019

David Harrison and Kate Davidson, “Worry About Debt? Not So Fast, Some Economists Say”, Wall Street Journal, Feb 17, 2019, https://www.wsj.com/articles/worry-about-debt-not-so-fast-some-economists-say-11550414860, accessed Jun 24, 2019

Greg Robb, “What Modern Monetary Theory gets ‘plain wrong,’ according to former IMF chief economist”, MarketWatch, Jun 11, 2019, https://www.marketwatch.com/story/what-modern-monetary-theory-gets-plain-wrong—former-imf-chief-economist-2019-06-11, access Jun 24, 2019

Patricia Cohen, “Modern Monetary Theory Finds an Embrace in an Unexpected Place: Wall Street”, NY Times, Apr 5, 2019, https://www.nytimes.com/2019/04/05/business/economy/mmt-wall-street.html, accessed Jun 24, 2019

Katia Dmitrieva, “Wall Street Economists Wade Into the MMT Debate in a Big Way”, Bloomberg, Apr 8, 2019, https://www.bloomberg.com/news/articles/2019-04-08/goldman-sees-mmt-positives-as-economists-debate-who-buys-lunch, accessed Jun 24, 2019

Social Security

Email interviews with William Gale, Brookings Institution, and Patrick Newton, Committee for a Responsible Federal Budget, 2018

Social Security Administration, History: Debunking some myths, https://www.ssa.gov/history/InternetMyths2.html

Social Security Administration, Frequently Asked Questions about the Social Security Trust Funds, https://www.ssa.gov/oact/progdata/fundFAQ.html

https://en.wikipedia.org/wiki/Social_Security_Trust_Fund

https://www.davemanuel.com/how-much-money-does-the-us-government-owe-the-social-security-trust-fund-155/

Teresa Ghilarducci, “Social Security Does Not Add To The Federal Deficit”, Forbes, Oct 19, 2018, https://www.forbes.com/sites/teresaghilarducci/2018/10/19/social-security-does-not-add-to-the-federal-deficit/#5cc5370e2081, accessed Jan 8, 2019

Related Problems: Climate Change, Infrastructure, Access to Healthcare

Researched and written by George Linzer Reviewed by Committee for a Responsible Federal Budget and William Gale

Published on November 5, 2019

Please support our work. Your donation will help us keep the spotlight on our systemic problems, the leaders trying to solve them, and the progress they are making.

Donate Now

Progress Updates

Debt Fails to Get a Hearing

2020-03-05T19:27:46-05:00November 3rd, 2019|

Through four democratic primary debates, debate moderators failed to ask a single question on the national debt.

Leader Profiles

Ross Perot: Candidate for President

2020-02-17T16:33:03-05:00

In 1992, billionaire entrepreneur Ross Perot put the national debt on the political radar during his third-party campaign for President. At the time, the debt had doubled in a decade to 47% of GDP. Perot believed this to be unsustainable.

Go to Top