National Debt by Year Compared to GDP and Major Events

As of 2019, the U.S. national debt was more than $22 trillion, which is greater than the economic output of the entire country. It occurred despite Congressional attempts to cut government spending. These included threats to not raise the debt ceiling and the U.S. debt crisis in 2011. That's when the United States headed toward a debt default. It continued with the fiscal cliff crisis in 2012 and a government shutdown in 2013. Sequestration slowed but didn't halt deficit spending beginning in 2013. 

You can't look at a country's national debt in isolation. Some would argue that expansionary fiscal policy, such as spending and tax cuts, was needed to spur the economy out of recession. Other times, the United States increased military spending to respond to national threats. 

For those reasons, the national debt by year should be compared to the size of the economy as measured by the gross domestic product. This gives you the debt-to-GDP ratio. You can use it to compare the national debt to other countries. It also gives you an idea of how likely the country is to pay its debt back.

The government creates debt with either excessive spending or deep tax cuts. If this expansionary fiscal policy boosts growth, it can begin to lower the debt. A growing economy will produce more tax revenues to pay back the debt. The theory of supply-side economics says the growth will be enough to replace the tax revenue lost. But that only occurs if taxes are too high—more than 50% of income, for example. 

There are other events that can increase the national debt. For example, the U.S. debt grew after the Sept. 11 attacks in 2001 as the country increased military spending to launch the "War on Terror." Between fiscal years 2001 and 2020, those efforts cost $2.4 trillion. This included increases to the Department of Defense and the Veterans Administration.

In the table below, the U.S. debt by year is compared to GDP and national events since 1929. The debt is taken from three sources. The debt from 1929 to 2018 is from the U.S. Treasury Historical Tables. The debt from 2019 to 2021 is from the White House FY 2020 Budget. Where needed, debt figures were also taken from the U.S. Treasury Debt to the Penny. 

GDP is taken from the U.S. Bureau of Economic Analysis.

Please note that the debt and GDP are given as of the end of the third quarter, Sept. 30, in each year to coincide with the fiscal year. That's the best way to accurately determine how spending in each fiscal year contributes to the debt and to compare it to economic growth. Please note: GDP in the years up to 1947 is not available for the third quarter, so year-end figures are used.  

Additional resources for the comments section include Historical Fed Funds Rate, History of Dow Closing Average, and Cost of Major U.S Wars, compiled by the Congressional Research Service.