Among developed countries, Japan has long had the highest debt/GDP ratio, currently ~232%. That seems pretty bad, and conversely has made some people say that the US debt is fine because it's still much lower than Japan's. But here are some points that might clarify the situation:
Second, the Japanese government holds a lot of stocks and foreign bonds. Its net debt/GDP is "only" 140%, and has declined since 2020. The US government doesn't do that. (The government of Singapore also holds a lot of assets, and Temasek is well-known as a large investment fund, but Japan is a bigger country, and despite smaller holdings per capita, its investments are much larger than Singapore's.)
Meanwhile, America's federal debt/GDP ratio is ~124%. Add in state debt and it's ~127%. So the net debt/GDP of the US government isn't that different from Japan. It's still higher, but arguably the "quality" of that US GDP is lower, for a couple reasons:
The US has a worse trade balance than Japan. It borrows more money, and has a net inflow of investment. That investment and borrowed money then circulates around and raises GDP by some multiplier, mostly by making both prices and incomes higher in the US.
Japan has higher PPP/nominal GDP than the US, by a factor of ~1.6x. Arguably this is a better measure of ability to pay back debt with real stuff than nominal GDP.
On the other hand, the US does have more natural resources, and the federal goverment owns a lot of land. My point is just that, while I've often seen it said that the US government debt situation is clearly better than Japan's, that's not clearly the case.
One general point I've heard in this regard, is that Japan's debt is mostly owned by large Japanese companies and so carries a much smaller risk for the government.
Among developed countries, Japan has long had the highest debt/GDP ratio, currently ~232%. That seems pretty bad, and conversely has made some people say that the US debt is fine because it's still much lower than Japan's. But here are some points that might clarify the situation:
First, that ratio has declined recently, from 258% in 2020.
Second, the Japanese government holds a lot of stocks and foreign bonds. Its net debt/GDP is "only" 140%, and has declined since 2020. The US government doesn't do that. (The government of Singapore also holds a lot of assets, and Temasek is well-known as a large investment fund, but Japan is a bigger country, and despite smaller holdings per capita, its investments are much larger than Singapore's.)
Meanwhile, America's federal debt/GDP ratio is ~124%. Add in state debt and it's ~127%. So the net debt/GDP of the US government isn't that different from Japan. It's still higher, but arguably the "quality" of that US GDP is lower, for a couple reasons:
On the other hand, the US does have more natural resources, and the federal goverment owns a lot of land. My point is just that, while I've often seen it said that the US government debt situation is clearly better than Japan's, that's not clearly the case.
By the way, another economic metric I think is interesting to compare is median and average personal wealth.