'Debt held by the public' – such as Treasury securities held by investors outside the federal government, including those held by individuals, corporations, the Federal Reserve, and foreign, state and local governments.There are two components of gross national debt: In general, government debt increases as a result of government spending and decreases from tax or other receipts, both of which fluctuate during the course of a fiscal year. In a deficit year the national debt increases as the government needs to borrow funds to finance the deficit, while in a surplus year the debt decreases as more money is received than spent, enabling the government to reduce the debt by buying back some Treasury securities. The terms 'national deficit' and 'national surplus' usually refer to the federal government budget balance from year to year, not the cumulative amount of debt.
The national debt at any point in time is the face value of the then outstanding Treasury securities that have been issued by the Treasury and other federal government agencies.
The national debt of the United States is the total national debt owed by the federal government of the United States to Treasury security holders.
