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─────── August 22, 2026 ───────
Happy Saturday!
Did you know that the U.S. has been in debt every day since its inception (except for just one… more on that later)? Apparently, wars are expensive. And since Uncle Sam’s IOU just hit $40T for the first time ever, we thought you might be wondering, “How does national debt even work?” “Who does the U.S. owe?” and “Why can’t we just be done with it all?”
Good questions. Come along, folks. We’re going to the bank.
New here? TPO Explains does a shallow dive into your most-asked questions every Saturday.
QUOTE OF THE DAY
“The goal of time with God is worship of God.”
Phylicia Masonheimer
BREWING QUESTIONS
WHAT YOU’RE ASKING
What do you mean by national debt?
It’s the total amount of money the federal government has borrowed to pay its bills.
When government spending outpaces revenue (taxes), a budget deficit is birthed. The government borrows to cover it, and if it's not paid back quickly, that baby deficit grows into a big adult deficit. “National debt” is just the running total of all those unpaid deficits stacked up.
Who do we owe money to?
Lotsa people.
Similar to how an individual’s total debt might consist of credit cards, a car loan, and a mortgage, the government’s debt consists of two types: debt held by the public (DHBP) and intragovernmental debt.
DHBP makes up about 80% of national debt. It refers to all the money borrowed from outside lenders. The government does this primarily by selling Treasury securities to things like state and local governments, mutual funds, and even individuals (so that bond fund in your 401(k) earns money because the government is paying you interest for loaning it money). Foreign investors hold ~29% of DHBP ($9.3T). We made a breakdown for you here (it does include a quiz… good luck!).
Intragovernmental debt makes up 20% of national debt and is debt that Uncle Sam owes himself… (yes, he can do that). For example, if the U.S. needs money to fund a war, and they take it out of the Social Security trust fund, that’s intragovernmental debt.
Why does the debt keep growing?
There are many reasons, some of which include:
Tax cuts = less revenue
Spending increases (think: Medicare, Social Security, and foreign wars)
Recession responses (think: COVID relief checks)
Rising interest rates (the U.S. pays about $1T in interest annually)
Why can’t Uncle Sam just cancel his debt?
Because that just makes it someone else's problem.
The real lenders holding that money would lose it overnight. Canceling intragovernmental debt would gut the trust funds it's held in (think: Social Security), leaving less to pay out to the people counting on them. And no one would loan Uncle Sam money again.
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CHRISTIAN PERSPECTIVE
No matter your thoughts on the national debt, Christians are called to manage their own finances wisely and to live generously, giving to those in need. Pray for guidance in doing both.
“Instruct those who are rich in the present age not to be arrogant or to set their hope on the uncertainty of wealth, but on God, who richly provides us with all things to enjoy.”
1 Timothy 6:17 (CSB) (read full passage)
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HOUSE BLEND
WHAT YOU’LL ENJOY…
Solving this week’s mini crossword!! The confetti is our fave part.
Learning about the one day that the U.S. didn’t have national debt.
A frog and dog staring contest...
Hand-poured candles that support resettled refugees. Founded by TPO readers R and R. and Karima B., Relume candles are handmade with U.S.-grown soybeans, phthalate-free fragrances, and cotton wicks. In other words… no more burning toxins. Every candle is made by refugee artisans who are learning English, establishing work history, building confidence, and finding hope. Treat yourself to clean, cozy scents.*
*This is a free promo for a TPO-reader-owned small biz. Have your own small business you want us to know about? Fill out this form!
WHAT YOU’VE BEAN CLICKING…
Top News Link: The Meta whistleblower’s previous testimony was one of our most-clicked news links ever.
Top Christian Perspective: A verse to consider when you’re seeking progress. Download and save graphics of it here!
Top Whipped Cream: Y’all loved this Chilean sunset (and we don’t blame you one bit).
TAKE IT TO GO
WHAT WE’RE RECOMMENDING
What We’re Enjoying
The Friday Update*
For years, my dad (a pastor of 30+ years) has published The Friday Update—a collection of insights on culture, thought-provoking quotes, fascinating statistics, Biblical wisdom, and quick hits on things he’s found interesting in the last week.
I didn’t read it for a long time (it was an email from my dad…), but after giving it a shot, I’m pleased to say he seems wiser and more interesting than when I was in high school.
The Friday Update is loved by pastors, business leaders, and Mike’s son. You may enjoy it too. It’s free. Subscribe in one click and enjoy his welcome email.
Jason Woodruff | Founder
*From our partners
WHAT WE’RE PRAYING
A Prayer for Freedom from Anxiety
Good Father, when I come to the headlines, I so easily spiral into anxiety about tomorrow: what will be in my bank account, who will be in the White House, what kind of world we are creating. But Your Word interrupts the spiral with Your promise: You know what I need, and You will provide.
Help me to rest in Your power and goodness, to seek Your kingdom first no matter what today holds—knowing that my Good Father sees me and will weave everything beautifully for my good and His glory. In Jesus’s name, amen.
LEARN WITH US
Each week, we do the deep shallow dive so that you don’t have to. We bring what we learn not only to this email, but we sit down and talk about it, too. Check out this week’s episode of TPO Explains... just click on the episode below.
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