A primer on national debt and the debt ceiling with a focus on the 2011 debt ceiling crisis and the Budget Control Act as well as an analysis of scenarios for debt reduction in 2013

1. Debt and the Debt-Ceiling Crisis
Exclusively For National Journal Members
Primer and Analysis

2. 2
Roadmap
Primer on Debt and the Debt Ceiling
2011 Debt Ceiling Crisis and Aftermath
2012 Debt Ceiling Crisis and Forecast

3. KeyTerms
Source: U.S. Department of Treasury; “House GOP Advances Debt Ceiling Bill,” Erik Wasson, The Hill, April 24, 2013. 3
Total outstanding borrowing by the federal government
A set limit at which the U.S. Treasury is no longer authorized
to finance U.S. debt obligations
$16.7T
$16.4T (On Feb. 4, 2013, the President signed into law a bill
suspending the debt ceiling through May 18, 2013. As a result,
the debt ceiling is not currently in effect.)

4. Breakdown of FY 2012 National Debt
Source: U.S. Department of Treasury. 4
Intragovernmental
Holdings
Debt Held by the Public
32%
Contributors to the Federal Debt
(Total Debt FY 2012: $16.4T)
Includes debt held by
government trust
funds including
Medicare and Social
Security
Includes debt held by
the Federal Reserve,
state and local
governments and
foreign and private
investors
30%
($4.8T)
70%
($11.6T)

5. National Debt Has Grown Rapidly
Source: U.S. Department of Treasury, Monthly Statement of the Public Debt and Historical Debt Outstanding, White House Historical Tables. 5
Debt held
by
Domestic
Private
Investors
22%
Growth of National Debt Over Time
$16.4T
Dramatic Increases in Past Three Decades
$4.9T
$0.14T
$20T
$10T
$0
.
.
.

6. Source: National Journal Research.
Debt Historically Hovers Near Ceiling
National Debt as Percentage of Year’s Ceiling
6
Debt Ceiling

7. Source: National Journal Research.
Debt Historically Hovers Near Ceiling
National Debt as Percentage of Year’s Ceiling
6
Debt Ceiling