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Where does the U.S. federal annual debt rank compared to other nations?

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Quick Answer

Economists use many different methods to measure national debt, but the method used most often when comparing countries to one another is called debt-to-gdp ratio, according to the Swiss National Debt Office. As of 2013, the United States had the 36th largest debt-to-gdp ratio, according to statistics from the CIA World Fact Book.

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Full Answer

Gdp, or gross domestic product, measures how much a nation produces in a year, and a debt-to-gdp ratio measures how much a country owes compared to how much it produces, the Swiss National Debt Office explains. This is an effective way to compare the debt of different countries because it takes into account the different sizes of the countries being compared. It would be difficult to compare the debt of a large country, such as the United States, with a very small country.

The British Broadcast Corporation illustrates this principle by comparing the 2012 debt and gdp of different countries. In the BBC's comparison, the United States has by far the largest debt in the world. Japan, in second place, has a national debt one-third lower than that of the United States. However, because the United States has the largest gdp in the world, and Japan has the third largest, the United States has a much smaller debt-to-gdp ratio than Japan.

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