Who Owns our Debt?
When the United States does not take in enough money to pay for our debts we have to borrow money. Right now our government is $14,290,000,000,000 in debt. It's a staggering amount that has sky-rocketed. In 2000, our debt was $6 trillion and in 2008 it was under $10 trillion.
Just like money that you and I might borrow from the bank, there is an interest charge. In this budget year, we will pay $205 billion in interest. By 2015, that number is expected to rise to $505 billion. This is taxpayer money that goes to nothing but paying the interest on our debt.
Some of our debt is held by foreign countries. China is the largest foreign country with just under $1.2 trillion of our debt. Japan has about $900 billion and the United Kingdom has around $350 billion. All together, about 32% of our debt is held by foreign governments or individuals.
About 40% of our debt is held by the Federal Reserve and other government entities. Five percent is held by state and local governments. Four percent is held by private investors. Another four percent is held by mutual funds. Finally, the remaining amount is held by other investors including banks, trusts, brokers and others.
Last week, I voted to Cut, Cap and Balance our federal budget as a part of any deal to raise the debt ceiling. We cannot continue to borrow $40,000 every second. We must begin to reduce our spending and we must do it now.
Sincerely,
