Skip Navigation

Total Public Debt Outstanding vs Debt Subject to Limit

November 8, 2004 - What is the difference between the total public debt outstanding and the total public debt subject to limit?

The Total Public Debt Outstanding represents the total par (principal amount) of Treasury marketable securities and Treasury non-marketable securities currently outstanding. Treasury Marketable securities include Treasury bills, notes and Treasury Inflation-Protected Securities (TIPS), all of which can be bought and sold in the secondary market at prevailing market prices. Treasury Non-marketable securities include savings bonds as well as special securities issued only to state and local governments and Federal trust funds such as Social Security. Treasury Non-marketable securities are payable only to the person(s) or entities to whom they are registered.

The Total Public Debt Subject to Limit is the maximum amount of money the Government is allowed to borrow under authority granted by Congress.

Total Public Debt Subject to Limit is defined as the Total Public Debt Outstanding less the Unamortized Discount on Treasury Bills and Zero-Coupon Treasury Bonds, old debt issued before 1917, and old currency called United States Notes, as well as Debt held by the Federal Financing Bank and Guaranteed Debt.

The authority to borrow on the full faith and credit of the United States is vested in the Congress by the Constitution. Article I, Section 8, Paragraph 2, states "[The Congress shall have power]…to borrow money on the credit of the United States." In 1917, Congress, pursuant to the Second Liberty Bond Act, delegated authority to the Treasury Department to borrow, subject to a limit. This action mitigated the need to seek congressional authority on each issuance, providing operational convenience. The debt limit essentially achieved its modern form in the early 1940s.

For more information, visit our "Public Debt Online" page.

Return to TreasuryDirect Home