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Frequently Asked Questions (FAQ) about the Debt

1)

GENERAL INFORMATION
1.1) Where is the money spent that is borrowed from the public and who decides where it goes?
1.2) What is the difference between the debt and the deficit?
1.3) What's the difference between the Total Public Debt Outstanding and the Total Public Debt Subject to Limit?
1.4) Why does the debt only change once a day? Why doesn't Treasury keep a rolling tab?
     
2)

MAKE UP OF THE DEBT
2.1) Is there a report that lists the type of Treasury Securities that are issued to finance the debt, their related maturity dates, and amount outstanding?
     
3)

OWNERSHIP OF THE DEBT
3.1) Who owns the debt?
3.2) What is the Debt Held by the Public?
3.3) What are Intragovernmental Holdings?
3.4) What is the Federal Financing Bank?
 
4)

FINANCING THE DEBT
4.1) Why does the debt sometimes go down?
4.2) How do you make a contribution to reduce the debt?
     

1)

GENERAL INFORMATION
  1.1) Where is the money spent that is borrowed from the public and who decides where it goes?
 
  The Bureau of Public Debt is responsible for the accounting for and reporting of the debt in accordance with statutory direction. The Bureau does not have any public policy decision making authority.

If you are interested in the cash position of the Treasury, the governments budget results, and the governments financial operations, then please visit the Financial Management Service's website. Also, information concerning the "Budget of the United States" is available at the Government Printing Office's website.
 
 
1.2) What is the difference between the debt and the deficit?
 
    The deficit is the fiscal year difference between what the Government takes in from taxes and other revenues, called receipts, and the amount of money the Government spends, called outlays. The items included in the deficit are considered either on-budget or off-budget. (The off-budget items are typically comprised of the two Social Security trust funds, old-age and survivors insurance and disability insurance, and the Postal-Service fund.) Generally, on-budget outlays tend to exceed on-budget receipts, while off-budget receipts tend to exceed off-budget outlays.

You can think of the total debt as accumulated deficits plus accumulated off-budget surpluses. The on-budget deficits require the Treasury to borrow money to raise cash needed to keep the Government operating. We borrow the money by selling Treasury securities like T-bills, notes, bonds and savings bonds to the public. Additionally, the Government Trust Funds are required by law to invest accumulated surpluses in Treasury securities. The Treasury securities issued to the public and to the Government Trust Funds (Intragovernmental Holdings) then become part of the total debt. For information concerning the deficit, visit the Financial Management Service website to view the Monthly Treasury Statement of Receipts and Outlays of the United States Government (MTS).
 
 
  1.3) What's the difference between the Total Public Debt Outstanding and the Total Public Debt Subject to Limit?
 
    The Total Public Debt Outstanding represents the total face amount or principal amount of marketable and nonmarketable securities currently outstanding.

The Total Public Debt Subject to Limit is the maximum amount of money the Government is allowed to borrow without receiving additional authority from Congress. Furthermore, the Total Public Debt Subject to Limit is the Total Public Debt Outstanding adjusted for Unamortized Discount on Treasury Bills and Zero-Coupon Treasury Bonds, Miscellaneous debt (very old debt), Debt held by the Federal Financing Bank and Guaranteed Debt.
 
 
  1.4) Why does the debt only change once a day?   Why doesn't Treasury keep a rolling tab?
 
    Our current accounting system produces the Total Public Debt Outstanding amount each morning around 11:30 A.M. EST. Our system relies on approximately 50 different reporting entities (e.g. Federal Reserve Banks) to report a variety of Treasury security information to us. Furthermore, the bulk of information that these reporting entities report to us is sent all at once at the end of the day. On the following business day our accounting system then absorbs all of this information reported to us and generates the Total Public Debt Outstanding for the previous day. Although we continually look for methods to improve our process, daily accounting is still the most effective, efficient, and accurate manner to account for the debt.
 
 
2)

MAKE UP OF THE DEBT
  2.1) Is there a report that lists the type of Treasury Securities that are issued to finance the debt, related maturity dates, and "Amount Outstanding"?
 
  The Monthly Statement of the Public Debt (MSPD) is available on-line in summary and full versions, list the types of Treasury Securities issued to finance the Debt, the related maturity dates, and the "Amount Outstanding".
 
 
3)

OWNERSHIP OF THE DEBT
  3.1) Who owns the debt?
 
  The Treasury Bulletin, available online from the Financial Management Service categorizes ownership of US Government securities by types of investors, e.g., public, federal reserve banks, foreign investors, corporations, etc.
 
 
  3.2) What is the Debt Held by the Public?
 
  Debt Held by the Public -- Is all Federal debt held by individuals, corporations, state or local governments, foreign governments, and other entities outside of the United States Government less Federal Financing Bank securities. Types of securities held by the public include, but are not limited to, Treasury Bills, Notes, Bonds,and TIPS, United States Savings Bonds, State and Local Government Series.
 
 
  3.3) What are Intragovernmental Holdings?
 
  Intragovernmental Holdings -- Government Account Series securities held by Government trust funds, revolving funds, and special funds; and Federal Financing Bank securities. A small amount of marketable securities are held by government accounts.
 
 
  3.4) What is the Federal Financing Bank?
 
  Federal Financing Bank -- Obligations issued to the public by the Federal Financing Bank (FFB) to finance its operations. The amount is limited to $15 Billion, or other amounts as authorized in Appropriations Acts. FFB was established "to consolidate and reduce the government's cost of financing a variety of federal agencies and other borrowers whose obligations are guaranteed by the federal government." (The First Boston Corporation, The Pink Book: Handbook of U.S. Government & Federal Agency Securities, 34th ed., Probus, Chicago, 1990 pp. 87-88.)
 
 
4)

FINANCING THE DEBT
  4.1) Why does the debt sometimes go down?
 
  The Total Public Debt Outstanding decreases when there are more redemptions of Treasury securities than there are issues. The Total Public Debt Outstanding is a direct result of receipts and outlays. If the Treasury projects an increase in outlays, then it will issue Treasury securities to meet its obligations. This will result in an increase to the debt. If the Treasury projects an increase in receipts (e.g. taxes or other revenue), then it may not need to issue Treasury securities.
 
 
  4.2) How do you make a contribution to reduce the debt?
 
  Please follow these important steps to make a contribution to reduce the debt.
  1. Make check payable to the "Bureau of the Public Debt"
  2. In the memo section of the check, make sure you write "Gift to reduce the Debt Held by the Public "
  3. Mail check to -
ATTN  DEPT  G
BUREAU  OF  THE  PUBLIC  DEBT
P O  BOX  2188
PARKERSBURG,  WV   26106-2188
 
 
This FAQ is maintained by The Bureau of the Public Debt's Office of Public Debt Accounting. Keep in mind that these questions may not fit all situations and are only intended as a guideline.