Crs Report for Congress

Sovereign debt, also called public debt or government debt, refers to debt incurred by governments. Since the global financial crisis of 2008-2009, public debt in advanced economies has increased substantially. A number of factors related to the financial crisis have fueled the increase, including fiscal stimulus packages, the nationalization of private-sector debt, and lower tax revenue. Even if economic growth reverses some of these trends, such as by boosting tax receipts and reducing spending on government programs, aging populations in advanced economies are expected to strain government debt levels in coming years. High levels of debt in advanced economies are a relatively new global concern, after decades of attention on debt levels in developing and emerging markets. Three Eurozone countries, Greece, Ireland, and Portugal, have turned to the International Monetary Fund (IMF) and other European governments for financial assistance in order to avoid defaulting on their loans. There are also concerns about the sustainability of public debt in Japan and the United States.