A new study assesses the U.S. government’s off-balance-sheet liabilities at six times the size of the official debt, or $70.1 trillion.
The working paper, released Monday morning by the National Bureau of Economic Research, finds that the government is on the hook for about $50 trillion in obligations to future retirees through Social Security and Medicare that do not show up in the official debt figures.
The feds also have $7.5 trillion in housing commitments through Fannie Mae, Freddie Mac, the Federal Housing Administration and other government housing programs.
Bank deposits insured by the Federal Deposit Insurance Corporation total another $7.6 trillion. And the government also has $325 billion in liabilities through its student loan programs. Add another $1.8 trillion in obligations to other government trust funds, and total off-balance-sheet debt is $70.1 trillion.
The study’s author, James D. Hamilton, is an influential macroeconomist at the University of California, San Diego. Hamilton is also a popular economics blogger, who has written about his study.
Hamilton writes that he is not predicting a crisis based on the $70.1 trillion figure, and that it “may or may not translate into significant on-balance-sheet problems.”
“But one thing seems undeniable — they are huge,” Hamilton writes. “And implicit or explicit commitments of such a huge size have the potential to have huge economic consequences, perhaps for the better, perhaps for the worse.”
Total U.S. debt held by the public is $11.9 trillion, according to the Treasury Department. That is debt in the form of outstanding Treasury bonds.
The debt subject to the debt limit is $16.7 trillion. That figure includes IOUs held by the Social Security and Medicare trust funds.