By Charlie Clarke
I am not sure it's generally appreciated that the debt ceiling is on gross debt and includes debt that the Federal Government itself holds. Thus, the treasury issues a bond (an IOU) and then also buys the bond to hold in a government account. This counts as outstanding debt, but it isn't the more meaningful "debt held by the public." The debt ceiling constrains the somewhat meaningless gross debt. Of the $16.8 trillion in total debt, $12 trillion is owed to the public and $4.8 trillion is held by the U.S. government. Below I have a picture of where those government Treasuries end up.