The federal government has carried debt throughout virtually all of U.S. history.
As part of Alexander Hamilton's plan for strengthening the financial credit of the post-Constitution nation, the federal government assumed the debt incurred during the Revolutionary War and the period under the Articles of Confederation.
Since that time, federal debt as a share of the nation's income has varied.
Historically, the nation has run up deficits during wars and recessions, but then debt has subsequently declined. For example, debt as a share of the economy peaked just after World War II, but then fell. In recent years, however, sharp increases in deficits and the resulting increases in debt have led to heightened concern about the long-term sustainability of the federal government's fiscal policies.
Discussion and debate about fiscal (spending and tax) policy and about debt can benefit from consistent understanding of basic terms and definitions. This section provides a broad range of information about federal debt including its relationship to the budget, ownership of the debt, debt management, and key policy considerations.
