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Finance

How Much US Debt Does China Own?

The US national debt is more than $17 trillion US Dollars (USD), or roughly equal to the country’s gross domestic product (GDP), and China owns about 7.6% of it, or more than $1.2 trillion USD. China is the largest overseas creditor of the US. Japan is the next-largest overseas creditor, and it owns about $1.1 trillion USD of the US national debt. More than one-fourth of the US debt is actually owed to its own federal government, such as the Social Security trust funds and the Federal Reserve.

More about the US national debt:

  • The US was created with a national debt; a 1790 analysis estimated that the new country had a debt of $75 million USD, or about 30% of its GDP.

  • As of 2014, Andrew Jackson is the only US president to get the US national debt completely paid off during his presidency — the country was debt-free from 1835 to 1836.

  • The US national debt has not been below $1 billion USD since 1866.

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Discussion Comments

By Chmander — On May 25, 2014

Debt can be a tricky thing. Whether you have a regular paying job, or you're a large industry that sells products overseas, it can add up very fast. This article gives some interesting tidbits about the effects of debt, and the power that China has.

By RoyalSpyder — On May 25, 2014

@Viranty - If you reread the short article again, notice how it says that China is the largest overseas creditor. Based on this fact, it's very easy to assume that they owe so much money because they send a lot of products overseas. This also answers your second question. Since China is such a large overseas creditor, this is why so many items from the United States aren't actually made there.

By anon953216 — On May 24, 2014

Well, everything in China is rather inexpensive, so it's very cheap to live there. Because of this, everybody gets paid extremely horribly. And since the pay is so bad, companies prefer to pay for labor there instead of here, because it costs less money to have them build the product then ship it over here, rather than have it simply made here.

By Viranty — On May 24, 2014

Just wondering, but does China own so much U.S. debt because they make a lot of products that are bought and sold to the U.S.? If so, that actually makes a lot of sense. Speaking of which, why are so many items from the U.S. made in China? It makes the objects seem a lot more foreign than they need to be.

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