Who owns America? Hint: It's not China
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July 21st, 2011
04:30 PM ET

Who owns America? Hint: It's not China

Editor's Note: The following piece comes from Global Post, which provides excellent coverage of world news – importantmoving and odd.

By Tom Mucha, Global Post

Truth is elusive.  But it's a good thing we have math.

Our friends at Business Insider know this, and put those two principles to work today in this excellent and highly informative little slideshow, made even more timely by the ongoing talks in Washington, D.C. aimed at staving off a U.S. debt default.

Here's the big idea:

Many people — politicians and pundits alike — prattle on that China and, to a lesser extent Japan, own most of America's $14.3 trillion in government debt.

But there's one little problem with that conventional wisdom: it's just not true. While the Chinese, Japanese and plenty of other foreigners own substantial amounts, it's really Americans who hold most of America's debt.

Here's a quick and fascinating breakdown by total amount held and percentage of total U.S. debt, according to Business Insider:

 

  • Hong Kong: $121.9 billion (0.9 percent)
  • Caribbean banking centers: $148.3 (1 percent)
  • Taiwan: $153.4 billion (1.1 percent)
  • Brazil: $211.4 billion (1.5 percent)
  • Oil exporting countries: $229.8 billion (1.6 percent)
  • Mutual funds: $300.5 billion (2 percent)
  • Commercial banks: $301.8 billion (2.1 percent)
  • State, local and federal retirement funds: $320.9 billion (2.2 percent)
  • Money market mutual funds: $337.7 billion (2.4 percent)
  • United Kingdom: $346.5 billion (2.4 percent)
  • Private pension funds: $504.7 billion (3.5 percent)
  • State and local governments: $506.1 billion (3.5 percent)
  • Japan: $912.4 billion (6.4 percent)
  • U.S. households: $959.4 billion (6.6 percent)
  • China: $1.16 trillion (8 percent)
  • The U.S. Treasury: $1.63 trillion (11.3 percent)
  • Social Security trust fund: $2.67 trillion (19 percent)

So America owes foreigners about $4.5 trillion in debt. But America owes America $9.8 trillion.

For a smart take on how President Obama and House Republicans should end gridlock over debt and deficits, see our new GlobalPost series The Negotiator, which features Wharton's negotiation guru Stuart Diamond.

And to bone up on China's debt — another potentially big global economic headache — check out this interview with brainy-yet-coherent Northwestern University economist Victor Shih, who spoke with GlobalPost's David Case.

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Topics: China • Economy • United States

soundoff (1,224 Responses)
  1. Celestina Rosebur

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    December 11, 2011 at 5:42 am | Reply
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    December 16, 2011 at 6:40 am | Reply
  3. coplinna

    This may be the case, but the concern over China's 1.6 trillion in US bonds vs. what "America owes America" should be obvious: America is not going to call in its debt on America. China can. That is the issue.

    December 19, 2011 at 9:00 am | Reply
  4. Frank

    Americas money isnt owned by america, thats why it says Federal Reserve Note on top of the bills, and the federal reserve isnt owned by the american ppl either, and no china dont own it either.
    The American people have not been allowed (by act of congress) to own gold for a very long time, therefore is the actual american dollar actualy legal tender if its not issued by tresurery, seeing as its backed by gold that the countrys people have not been allowed to own.
    Should it be asked, Who ownes the Federal Reserve ? not china, not america, Who ???

    December 31, 2011 at 3:52 am | Reply
  5. Sac

    Facts of America and American People
    1) 95 % people are fooled by 5 % wealthy here by saying America is rich and prosperous and Asia is backward.
    2) Most of the American never went outside America and know the facts of world just happy in assumption that America has great life.
    3) If looked at middle population in America, Indian and Chinese are the one who hold money in America.
    4) All middle level jobs are done by American where as 90 % Indian here does high paid jobs.
    5) America is finding it difficult day by day to fool world by saying that America and American are rich. They are one among poor and middleclass in America.
    6) Without credit most of American cannot afford to pay one day meal or one tynol dose.
    7) Most of doctors, engineers and lowers are Indian in American.
    8) By 2020 you cannot hide the possibility that any Indian or Chinese origin person will be president of America.
    9) American media and corporate are benefiting the uneducated Americans by playing with their emotions and firing their false assumptions.
    10) Next generation America will not be land of opportunity but will be land of insanity.
    11) American Era has gone. Next generation will be poor and mostly ruled by immigrants here (Indian or Chinese).

    January 5, 2012 at 4:34 pm | Reply
  6. zakaria

    Israel and Sudi Arabia

    January 19, 2012 at 3:59 pm | Reply
  7. Johnny 5

    So America owes most of the debt to itself? I don't see how this could be so. It all stinks of one big Ponzi scheme.

    January 19, 2012 at 4:34 pm | Reply
  8. Peggy

    you all are really 'Peggy" or is it Pakii?

    January 28, 2012 at 8:53 pm | Reply
  9. jane

    I am extremely gracious for the fine posting sir! Keep up your superb work. A big THANKS from me!

    February 1, 2012 at 4:00 pm | Reply
  10. Nick Batzdorf

    The story above is only 11% of the whole story. Paul Krugman wrote a great column about this very subject last month.

    http://www.nytimes.com/2012/01/02/opinion/krugman-nobody-understands-debt.html

    "It’s true that foreigners now hold large claims on the United States, including a fair amount of government debt. But every dollar’s worth of foreign claims on America is matched by 89 cents’ worth of U.S. claims on foreigners. And because foreigners tend to put their U.S. investments into safe, low-yield assets, America actually earns more from its assets abroad than it pays to foreign investors. If your image is of a nation that’s already deep in hock to the Chinese, you’ve been misinformed. Nor are we heading rapidly in that direction."

    February 2, 2012 at 3:49 pm | Reply
  11. Joravarlhof

    I love this blog and every thing about it. I have been reading it for awhile but have yet to say hello. well...Hello!

    February 6, 2012 at 7:04 pm | Reply
  12. Joravarlhof

    Fantastic post and it really is definitly worth a comment from me. You have earned a loyal fan.

    February 7, 2012 at 7:24 pm | Reply
  13. Joravarlhof

    I normally hate commenting, but i thought i would give it a go for this blog. Been reading your stuff for awhile.

    February 8, 2012 at 5:31 am | Reply
  14. loan

    Cheers for the post, definitly Gauza batzuk i aurkitutako liluragarriak , nahikoa egin comment honetan jaregin me.

    February 9, 2012 at 3:36 am | Reply
  15. buck

    I was wondering if we were to call in that dept...who would pay...

    February 13, 2012 at 7:23 pm | Reply
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