In 1989 , New Yorkreal estate investorSeymour Durst expend $ 120,000 to erect a " National Debt Clock " on 42nd Street and Sixth Avenue to cut across the precise amount of money theU.S. Union governmentwas borrowing to pay its bill . At the time , the country had run up a $ 2.7 trillion tablet , but that figure seems almost quaint today .
In 2008 , the clock briefly ran out of available digits when the debt pass $ 10 trillion . By April 2024 , the advance clock , which can now display up to a quadrillion dollars , registered more than $ 34 trillion [ source : US Debt Clock ] .
Now , it ’s authoritative to understand that the U.S. does n’t owe that entire $ 34 trillion to its creditor , which include individuals , businesses and foreign authorities who purchased U.S.Treasury bondsand securities . By December 2023 , the government - incurred debt thwart the $ 7 trillion mark for intragovernmental property , which are funds the U.S. owe itself , primarily for the Social Security and Medicare trust funds [ source : Amadeo , U.S. Treasury ] .
But the question we need to answer today is : Who possess the bulk of that $ 34 trillion in public debt ? you may find out by peruse our globular parade of America ’s large sugar daddies , allot to the U.S. Department of the Treasury . ( Note : The most recent figures turn cover up to February 2024 . )
12. Taiwan
Creditor name : Taiwan
Amount of U.S. debt possess : $ 255.6 billion
This lowly island nation make nearly all of its money exporting goods to Europe , the U.S. and China . So when the man thriftiness is ripe , the Taiwanese economy is very skillful [ source : Shapiro ] . But to hedge for the bad time , Taiwanese investors put their money in the good securities in the public : U.S. debt .
Taiwan is a republic with a constitution and a freely elected president . After World War II , the Communist political party wrested control of the regime from the Nationalist party and create the People ’s Republic of China ( PRC ) . But many Nationalist leader and sympathizers relocated to Taiwan , formally called the Republic of China [ source : Bloomberg ] . In sum , there were two Chinas . And the furious affair is , there still are .
Both mainland China and Taiwan considered themselves the " one China , " and the U.S. often encounter itself in awkward diplomatic dominion . On the one hand , America recognized PRC as the " real " China and severed diplomatic relations with Taiwan in 1979 [ source : Maizland ] . But on the other script , it sells Taiwan 100 per centum of its arms , a $ 129 million transaction [ source : Frohlich ] . Money from Taiwanese investors also helped fuel the economic boom on the mainland [ source : CIA World Fact Book ] .
11. Switzerland
Creditor name : Switzerland
Amount of U.S. debt owned : $ 256.6 billion
Switzerland is a pocket-sized but incredibly wealthy European nation long illustrious as an offshore tax haven for wealthy investor . The Swiss love high employment , longer - than - medium living anticipation and social station among the happy nation in the world [ source : OECD ] . The Swiss — or at least Swiss banks — are also one of the most reliable buyer of U.S. debt , routinely among the major investor in U.S. Treasury security measure .
The country ’s revenue enhancement - oasis sobriquet is n’t quite so precise any longer , either . After much pressure from the U.S. and the European Union , Switzerland ’s once - hard-and-fast banking privacy laws have been diminished , lessening its ability to hide money [ source : Goetz ] .
10. France
Creditor name : France
Amount of U.S. debt owned : $ 284 billion
The United States has a prospicient history of owingmoney to France . The U.S. borrowed money from the European nation during the American Revolution . In February 2024 , France owned $ 182.3 billion of U.S. debt .
9. Cayman Islands
Creditor name : Cayman Islands
Amount of U.S. debt owned : $ 302.6 billion
The tiny Cayman Islands is one of the biggest owners of U.S. debt , mostly because of the hedge funds on the island . With an estimated half of the existence ’s hedge fundsdomiciled in the Cayman Islands , the $ 302.6 billion is inflated .
8. Ireland
Creditor name : Ireland
Amount of U.S. debt owned : $ 316.9 billion
Irelanddoesn’t leap to brain when you mull over which countries own a lot of U.S. debt . After all , the small island state is better known as the home of leprechaun and Guinness beer . But it ’s also home to many U.S. transnational society like Alphabet / Google , which decide there due to the country ’s low collective tax rate and other mechanisms that have allow companies based in Ireland to reallocate profit to tax oasis like Bermuda and pay off zero corporate revenue enhancement .
However , change is underway .
After watching companies such as Google shift billions of buck of gain to taxation havens , the G7 announced a minimum world-wide collective tax of 15 percentage in June 2021 , something Ireland has vigorously protested . Other nation , too , are interchange their rules regarding the taxation of foreign earnings . How this all plays out on the global stage stay to be seen [ sources : Sebastian , Subramanian ] .
7. Belgium
Creditor name : Belgium
Amount of U.S. debt owned : $ 320 billion
We know what you ’re mean : Belgium ? Really ? The rank domestic product ( GDP ) of this modest European nation tucked between France , Germany and the Netherlands ranksNo . 25 in the world , behind Sweden and Norway [ beginning : Statistics Times ] . So why is Belgium one of the top 10 purchasers of U.S. debt ?
Belgium has made a name for itself as one of Europe ’s most vibrant outside banking centers . Bank answer for here historically offered a gamy academic degree of privateness , although that changed in 2011 when the Belgian government began disclose account info to improve taxation transparentness [ source : Hyslop ] .
In addition , there ’s something called " custodial bias " at work . Belgium ’s position as atax havenmakes it a popular spot to buy U.S. debt . And investor do just that , whether they endure in nearby France and Germany , or far - flung locale such as China and Japan . But the U.S. Treasury tail leverage of U.S. debt by geographic origin , not the specific nationality of the buyer [ reservoir : U.S. Treasury ] . Thus , the amount of the debt ascribed to Belgium that is actuallyownedby Belgians is difficult to pick out .
6. Canada
Creditor name : Canada
Amount of U.S. debt have : $ 353.8 billion
Canada has possess an increasing amount of the U.S. ’s debt in late years . In 2012 , Canada did not rank within the top 10 or even top 15 . But between January 2009 and July 2012 , Canada ’s debt ownership increased by561.9 percent .
5. Luxembourg
Creditor name : Luxembourg
Amount of U.S. debt have : $ 379 billion
A nation of bankers , itsy - bitsy Luxembourg has thethird - highestgross domestic product ( GDP ) per caput in the reality — $ 125,006 in 2022 — and has no reservation about investing in other nations ' cheap debt . Yet Luxembourg ’s own economic stability is up for disputation . While it owns $ 379 billion of U.S. debt , the tiny country owes more than $ 4 trillion to its own foreign creditors . That ranks tiny LuxembourgNo . 6on the global inclination of total strange indebtedness [ sources : The World Bank , The World Bank ] .
Like its neighbour , Belgium , Luxembourg is a tax seaport forwealthy alien investors . Also like Belgium , investor from around the earthly concern buy U.S. debt through accounts found in Luxembourg . Since the U.S. Treasury does n’t make out between debt bought by bona fide Luxembourgians and debt buy by foreigners , Luxembourg ’s debt ownership figures may be by artificial means inflated .
4. United Kingdom
Creditor name : United Kingdom
Amount of U.S. debt owned : $ 700.8 billion
TheUnited Kingdom(U.K. ) is on a roll when it do to owning U.S. debt . The U.K. is the world ’s sixth - biggest economy , with a$2.2 trillion GDPin 2023 , power by a strong service of process sector ( finance , insurance and patronage service ) . Yet at the scratch of 2020 , the U.K. officially come apart from the European Union ( EU ) in a move nicknamed Brexit .
Brexit means the U.K. is no longer part of the EU ’s destitute craft agreement . Partly due to this , many businesses subsequently travel their main office out of the U.K. and into EU body politic . In increase , Scotland , which vote against Brexit , is contemplating separate from the U.K. and joining the EU as an self-governing land . While the U.K. and EU did reach a trade correspondence in 2021 , its economic future is still changeable [ source : Amadeo ] .
3. China (Mainland)
Creditor name : China
Amount of U.S. debt owned : $ 775 billion
With 1.4 billion people , the world ’s secondly - largest economy and rapid economic growth , mainlandChinais an undisputed economical powerhouse [ root : World Bank ] . China is also the strange country that owns the second - most U.S. debt . The enquiry is : Is it regretful for the U.S. economic system or national certificate that one of America ’s biggest rivals owns a sizeable amount of its debt [ source : Investopedia ] ?
You might liken it to the arm airstream between the former Soviet Union and the United States during theCold War . Sure , either side could have launched its warheads and bring down terrible damage on the enemy , but an act of aggressiveness would have ensured an every bit hard retaliation .
If China desire to economically spite the U.S. by sell off its debt securities , the resultant could be dramatically high interest rate and a extortionate devaluation of the clam . But the Chinese would also shoot themselves in the foot . The Chinese have close to one-half of their hard currency reserves invested in U.S. debt [ source : Davidson ] . ForChina , it ’s the safest , best investing the arise nation can make . The return on their U.S. investment part fuels China ’s economic growing . Poisoning the one dollar bill would take the yuan right on down with it [ source : Capaccio ] .
2. Japan
Creditor name : Japan
Amount of U.S. debt owned : $ 1.17 trillion
We ’ve been speak a lot about America ’s debt trouble , but how does U.S. indebtedness liken to other industrialised nations ? The most useful debt mensuration is to calculate the ratio of public debt to gross domesticated product ( GDP ) . At the end of 2020 , U.S. public debt totaled 107.6 pct of the GDP , meaning the U.S. borrowed more than what it earn that year . And while 2020 was the year the COVID-19 pandemic ruined thriftiness around the earth , that figure was n’t a huge anomaly , as it was 106.9 per centum in 2019 [ source : Trading Economics ] .
Although a 107.6 pct debt - to - GDP ratio is n’t idealistic , it ’s a heck of a wad better than the billet inJapan , where public debt represented a idea - blow 246 percent of GDP in [ source : Commodity ] . How can the Japanese economy plump for such a lopsided debt - to - earnings ratio ?
It turns out that Japan ’s debt , while fantastically in high spirits , is not unsustainable . It brag the world’sfourth - largest GDP , and unemployment was a mere2.6 percentin 2023 . The country is also heavy invest in U.S. debt security , some of the most financially sound investments in the world .
But the biggest difference between Japanese and American debt is that Japanese citizens own 90 percent of their country ’s debt , with only 10 percent in the hands of outsider . In demarcation , foreign investor own a larger percentage of U.S. debt , making it a far riskier proposition [ source : Oh ] .
1. United States of America
Creditor name : American Public and State and Local government
Amount of U.S. debt owned : $ 6.8 trillion ( as of December 2022 )
surprisal ! The rural area theUnited States is most indebted tois … itself . As of December 2022 , here are some of the domesticated investor who own U.S. Treasury Securities [ source : U.S. Department of the Treasury ] :
Why would individual Americans , businesses and local administration continue to lend money to the United States ? Does n’t it seem risky to put money into an institution that ’s already $ 34 trillion in the hole ?
Believe it or not , investing in the administration is n’t a high - risk proffer . While the federal political science is hemorrhaging thousands of dollars by the second to pay interest on its debts , the U.S. has a vested interest in not defaulting on its loans . America ’s credit rating would drop , and the booming market for U.S. debt could dry up .
How would the U.S. government function without its international credit menu ? Let ’s hope we never find out out .
