Debunking the Myths: Does Canada Really Owe the U.S. $200 Billion?
You may have heard the claim that Canada owes the U.S. $200 billion, but did you know that the U.S. actually owes Canada more than that through investments in U.S. debt? Let’s dive into the facts, break down the misinformation, and uncover why understanding these economic relationships matters—especially for women who want to stay informed and empowered.
The Truth About Debt Between Canada and the U.S.
The financial relationship between Canada and the United States is a two-way street, built on borrowing, lending, and investing. Here’s what you need to know:
Canada’s Debt to the U.S.:
Canada does owe money to the U.S., but this is just one piece of its total external debt.
External debt refers to the money Canada owes to all foreign lenders, including U.S. banks, investors, and governments.
As of 2024, Canada’s total external debt was approximately 4.3 trillion Canadian dollars (CAD), but this figure is spread across multiple countries, not solely the U.S.
The U.S. Debt Owned by Canada:
Canada is also a creditor to the U.S. government, meaning it lends money by purchasing U.S. Treasury securities.
Canada holds a significant share of U.S. debt, well over $200 billion USD in some estimates, making it one of the U.S.’s important investors.
Where the Misinformation Comes From
The claim that "Canada owes the U.S. $200 billion" often stems from:
Misunderstanding economic data: People conflate Canada’s total external debt with its debt to the U.S. specifically.
Oversimplified narratives: Media or political discussions sometimes frame Canada as overly reliant on the U.S., ignoring the mutual nature of their financial ties.
Lack of clarity on U.S. debt ownership: Many don’t realize Canada’s role as a major holder of U.S. debt, which shifts the dynamic from dependency to partnership.
Why This Matters for Women
As women, we are increasingly stepping into leadership roles—whether in our careers, communities, or at the ballot box. Understanding the truth about international finance can help us:
Make informed decisions: Misinformation about debt can influence opinions on trade, policy, and global partnerships.
Shape conversations: Whether you’re discussing economics at work or over coffee with friends, having the facts empowers you to challenge myths and ask better questions.
Strengthen our voices: Women are key players in shaping the future, and knowledge is a powerful tool for advocacy and action.
The Real Story: A Mutual Relationship
The truth is, Canada and the U.S. share a deeply interconnected financial relationship:
Canada borrows from U.S. creditors but also invests heavily in U.S. debt.
This partnership benefits both nations, fostering economic stability and growth.
Misinformation can spread quickly, but understanding the facts helps us see the bigger picture. Canada doesn’t “owe” the U.S. $200 billion in a one-sided way—both nations depend on each other for financial support and investment.
By staying informed, we can cut through the noise and engage in meaningful discussions about the issues that shape our world. After all, empowered women empower the future!
