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 (1,220 Responses)
  1. Tdubois

    Anyone got a trillion dollars in the bank to pay off China? Didn't think so. When you owe someone money and you cannot pay them back, they "own" you.
    On another note, having the biggest company, bridge, airport means nothing. Having water and fertile ground to feed your people means everything. If the world economy collapsed tomorrow, we could still feed our people. Our lives would change dramatically, but we would get through. That's what matters.

    July 24, 2011 at 8:58 pm | Reply
  2. outawork

    Wait till our hyperinflation next year. Then we can use one of those shiny new 10 trillion dollar bills and paid ourselves off.

    July 24, 2011 at 9:05 pm | Reply
  3. Why Invest in US

    The question is not who US owns to. The Question is Why the world keeps invest into the U.S.
    The question is Why the wold can't use their surplus for any other better investment?
    The old said: The money is not your money until it is in your hands.

    July 24, 2011 at 9:33 pm | Reply
  4. Jeff in Illinois

    The premise that you may owe yourself money is false. Therefore, China does hold the largest amount of our debt.

    July 24, 2011 at 10:13 pm | Reply
  5. Jeff in Illinois

    My IP address must be banned.

    July 24, 2011 at 10:14 pm | Reply
  6. Jeff in Illinois

    ts

    July 24, 2011 at 10:15 pm | Reply
  7. Abraham Lincoln the All Knowing

    I have a question pertaining to this whole "economic armageddon" that is plaguing the US.

    My understanding of this whole situation, bar several highly complicated and stressful factors, is that on one hand you have one party wanting to increase tax revenue and lessen spending to pay the debt; on the other hand you have a second party wanting to prevent any tax increases and rather reduce or scrap the health care law in place.

    Now, to the question: Why would a political party want to reduce or "roll back portions" (in otherwords "scrap") the health care law when it benefits the whole nation, all 308+ million people)?

    Now this brings up a serious food for thought for the majority of you, and it really comes down to choices: A) Reduce (hint: scrap) the health care law; B) Increase tax revenue & reduce government spending

    What would you rather have? Other factors also come in to play, such as the credibility of the health care law, which would prompt some to say yes, reduce the bloody thing. Others, who cannot afford private health insurance, would say yes, increase tax revenue and reduce spending.

    Another factor to consider would be the ultra-high military spending over the last 5 decades. Is it really necessary for the USA to continuing serving as Protector of the World while at home it's facing rampant challenges to costs, economic destability and also general public dislikes of government interventions in other nations?

    If posed on the question at hand; what would you be your decision on this whole situation?

    July 24, 2011 at 11:33 pm | Reply
    • Matt

      Dude, we have been fired as the "Protector of the World."

      August 8, 2011 at 7:58 am | Reply
  8. n3kit

    Pride comes before destruction. America owes America $9.8 trillion. America then should just forgive himself and forget his pension funds. America owes America, easy on the ears, but pride always comes easy.

    July 24, 2011 at 11:34 pm | Reply
  9. teepee

    we know the U.S. don't own the U.S.

    July 25, 2011 at 12:08 am | Reply
  10. I do wonder...

    I wonder what would have happened had Truman not discharged General Douglas MacArthur following the general's intention to declare war with Red China during the early years of the Korean War. It is without a doubt a fact that any nation who goes to war against America will surely lose. America is not only the biggest economy in the world, currently standing for decades past, but it is also the most technologically advanced military nation in the world. So it is no surprise then that if America and Red China had gone to war then, Red China would have lost more than its economy. The nation would have shattered completely in the face of American brute force. Fast forward 6 decades, America is still the most technologically advanced nation in the world. However, in saying that, it can no longer guarantee 100% victory in wars. Other nations have adapted, more so especially China. China, after decades of social, political and economical reforms, stands to outpace America as the biggest economy in the world. So what does this mean? In the short term, it will not affect America. In the long term, the worry starts to set in. In the words of the wise Abraham Lincoln: "America will never be destroyed from the outside. If we falter and lose our freedoms, it will be because we destroyed ourselves."

    July 25, 2011 at 12:32 am | Reply
  11. Logan9773

    So, why don't we just forgive our debt to ourselves and that will knock off about 10 trillion dollars. Would make more sense than borrowing and raising the debt ceiling, wouldn't it? Besides, we always forgive everyone else's debt.

    July 25, 2011 at 1:11 am | Reply
  12. wowiser

    I always thought Hong Kong was part of China, or did my geography teacher fail me?

    July 25, 2011 at 1:32 am | Reply
  13. Hiruu

    This is all true, but China is a largest single foreign shareholder of US debt...but he is right, people don't understand the make-up of all this money we owe. Look at how much is owed Social Security…and Republicans behave as if that is what is causing our financial ruin…what a bunch of liars!

    July 25, 2011 at 2:33 am | Reply
  14. wusa1973usaw

    The total percentage is not 100%. In fact, far from it. The table is flawed.

    July 25, 2011 at 6:41 am | Reply
  15. mijau

    4,5 billion out of 14,3 is still a large foreing exposure (over 31%) and America doesn't have older siblings like Germany and France who will help out if things go wrong.

    July 25, 2011 at 6:55 am | Reply
  16. RukNiz

    As an outside observer, I feel India is just slightly better off then most poorest nations in the world. Go and see dehli/mumbai/kolkata/chennai at night you will find millions sleeping on the roads. Look at the shanty towns of almost all major cities. Its like people with no standards of living. Don't be fool about Indian media they show good pic which is less than 1% of the total population. So much poverty and lack of health and services its hard to believe unless you go and see by yourself. I don't think india is anywhere near a power. Need more than just few decades to feed 1.5 billons two meals a day. Sad but true.

    July 25, 2011 at 7:42 am | Reply
  17. Intrvrt

    Who holds the other 24.5% of the debt?

    July 25, 2011 at 8:57 am | Reply
  18. Math

    Has anyone checked the math on the article? If you count it all up, it is only 75.5% and 10.8108 trillion. Where is the rest of the money? That is alot of money to leave out of an article when your talking about where the money is.

    July 25, 2011 at 9:15 am | Reply
  19. Arjan

    stop hating on Fareed just because hes banging a white girl

    July 25, 2011 at 9:16 am | Reply
  20. icecycle66

    If I owe myself money, can't I just keep what I have as payback to me?

    July 25, 2011 at 10:59 am | Reply
  21. AP

    Worthless people wasting time on ignorant and non-relevant comments and reply. Do something useful for your country and the world. 🙂

    July 25, 2011 at 11:33 am | Reply
    • Matt@AP

      Okay, why don't you lead by example. Turn off your computer.

      August 8, 2011 at 8:01 am | Reply
  22. Tim Richardson

    I may not be on a par with all the other brainiac posters on this article who somehow got off on a bent over one person's departure about India. But, I can still count, and using what God gave me in the way of counting assistance i:e,
    fingers and toes...my total for the ownership of outstanding debt in this article is 75.5%. Hmmmm.wonder who owns the remaining 24.5% and why the esteemed author of this otherwise informative article chose not to reveal this information??? In the end, there is just way toooomuch information out there and most of it just has very little credibility.
    But, this was fun and now I'm off and back to the essential counting of my digits ,just so I can keep that essential tool finely tuned and ready for the next analysis. CNN I am disappointed in your work here.

    July 25, 2011 at 11:48 am | Reply
  23. Sam Glenn

    Most interesting thing is that the information presented does not even add up. The total presented is $10,815 billion and then it says the total is $14,300 billion that leaves $2,485 billion falling through the cracks.

    If this is a clarification, no wonder people are confused.

    July 25, 2011 at 12:03 pm | Reply
  24. trestatlo

    hahahaha this dumb stinky guy would like to rule America and the world with his smelly and ideology of caste slavery mindset. those who are humble would rule and those who are arrogant and boastful like this guy will bow down and become slave . . . =) lol Put your response in the toilet . . . lol =) have a bad day! let me know if you need some medicine for a heart attack! =) lol

    July 25, 2011 at 12:50 pm | Reply
  25. saywhat

    Did anyone else notice the obvious? The article is about US debt- the comments are about nothing related to US debt!

    July 25, 2011 at 2:02 pm | Reply
  26. Charles A. P. Wetherington

    When you look at History, say the past 150 years . All of Civilized Society owes it's existence to America. How do you measure that in dollars and cents!?

    July 25, 2011 at 3:46 pm | Reply
  27. Anpadh

    Just one question: Who owns the controlling interest in US banks and mutual funds? And, as a corollary to that question - where is Social Security money invested - in the US or abroad? This article is a joke! Whichever way you look at it, whichever country (other than the US) has the most money controls most of the debt of the US government.

    July 25, 2011 at 3:49 pm | Reply
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