Federal Debt

Federal debt is the total amount of money the government owes because it has borrowed funds to finance public spending when revenues (like taxes) fall short. It accumulates over time through the issuance of bonds and securities to investors, covering gaps between income and expenses. This debt must be repaid with interest, which can influence future government budgets and economic policy. Essentially, it represents the cumulative borrowing needed to fund government programs, infrastructure, and services beyond what is collected in taxes. Managing this debt involves balancing borrowing with economic growth and fiscal responsibility.