State of the Middle Class

U.S. Economy

The charts here show that in addition to the tremendous trade deficits, the U.S. faces increasing budget deficits and foreign wealth deficits.

Net international investment position (NIIP) for the United States measures how many foreign assets are owned by the U.S. and its citizens less how many U.S. assets are owned by foreigners. A negative number indicates that the world owns more assets in the U.S. than the U.S. owns in the rest of the world. Our NIIP is roughly -$50,000 per U.S. citizen (yes, that’s a “minus”). That ranks the U.S. with some of the most financially distressed countries in Europe after the Financial Crisis.

In a sense, that makes the U.S. a net debtor to the rest of the world.

Add to this the significant National Debt, and it paints a picture of the U.S. as a debtor nation that depends on others to produce many critical goods that we import. Meanwhile, we sell our valuable assets to those nations to fund our purchase of those goods.

NIIP by Country (Billions of USD)

Nation20052010201520202022 Q3
Japan1,531.83,150.42,715.23,422.13,171.9
Germany356.5720.51,138.82,680.02,760.3
China356.81,478.31,698.92,286.82,364.0
Canada-154.6-303.0323.2744.7449.3
South Korea-143.9-132.7204.5487.2746.6
Greece-177.9-298.8-261.3-352.8-290.5
United States-1,857.9-2,511.1-7,590.5-14,707.4-16,710.8

Major Foreign Holders of US Treasury Securities (Sept 2023)

CountryAmount
Japan$1,087.7
China$778.1
UK$668.9
Belgium$317.0
Luxembourg$373.6
Switzerland$280.1
Cayman Islands$314.8
Ireland$295.0
Taiwan$236.3
Brazil$223.0
France$228.2
Foreign holdings include government and private holdings.

Ratio of National Debt to GDP by Nation

Nation1976199820202022
China---21.3%68.1%76.9%
Germany---59.5%68.7%66.3%
United States35.2%61.3%106.7%121.1%
- As of 2022, foreign powers hold a total of $7.32 trillion, or 24%, of the U.S. federal debt.
- The Federal Reserve and the government own about $10 trillion of the U.S. federal debt
- China and Japan alone hold over $2 trillion in treasury securities 

Ratio of Deficit to GDP for the United States over Time

YearFederal Surplus / Deficit as % of GDP
19600.06%
1970-0.26%
1980-2.58%
1990-3.71%
20002.31%
2010-8.60%
2020-14.87%
2022-5.40%
The United States has not run a federal spending surplus since 2001.

Per Capita Net Foreign Wealth (NIIP) by Country

Country20052010201520202023 Q2
Japan$11,971.83$24,590.16$21,400.47$29,173.29$26,455.34
Germany$4,365.22$10,760.58$18,729.34$34,478.62$35,386.52
China$263.00$1,081.23$1,187.05$1,493.76$1,964.27
Canada-$4,352.61-$8,823.53$8,893.59$23,151.80$24,629.19
South Korea-$2,905.77-$2,623.61$3,920.80$10,621.86$14,701.64
Greece-$16,378.53-$26,978.42-$24,029.57-$32,649.25-$32,089.75
United States-$6,294.42-$8,115.10-$23,261.62-$42,185.13-$52,986.54
- Note: NIIP equals the amount of assets held by one country versus another. 
- Per each U.S. citizen, the world owns $49,313.96 more in U.S. assets than the U.S. owns in the rest of the world's assets.

Inflation Rate by Selected Countries

Year USA China Japan South Korea Taiwan 
Oct 20233.2%-0.2%3.3%3.8%3.1%
Sept 20233.7%0.0%3.0%3.7%2.9%
Aug 20233.7%0.1%3.2%3.4%2.5%
Ratio of Debt to GDP by nation

This figure is found by dividing a nation’s total debt by the real GDP at that period. Total debt is comprised of intragovernmental debt and debt held by the public. When a foreign nation owns part of another nation’s debt (for the U.S., this would be a nation buying Treasury bonds), this constitutes an increase in public debt.

Net International Investment Positions

According to Investopedia, net international investment position (NIIP) measures the gap between a nation’s stock of foreign assets and a foreigner’s stock of that nation’s assets. It is easiest to view this statistic as a sort of balance sheet for a nation. A negative NIIP figure indicates that foreign nations own more of the domestic nation’s assets than the domestic nation does of foreign assets. This makes the U.S. a net debtor nation.