National Debt Lesson Plan

Instructor: Tammy Galloway

Tammy teaches business courses at the post-secondary and secondary level and has a master's of business administration in finance.

If you are discussing the national debt, this lesson plan explores three categories of national debt and their impact on individuals and businesses. Students will read a text lesson and engage in discussion questions. Students will then participate in an activity and game that helps to cement the lesson concepts.

Learning Objectives

After this lesson, students will be able to:

  • explain why the United States has debt.
  • identify three categories of the national debt.
  • discuss the effects that national debt can have on a nation's economy.


60 minutes

Curriculum Standards

  • CCSS.ELA-LITERACY.W.11-12.1.a

Introduce precise, knowledgeable claim(s), establish the significance of the claim(s), distinguish the claim(s) from alternate or opposing claims, and create an organization that logically sequences claim(s), counterclaims, reasons, and evidence.

  • CCSS.ELA-LITERACY.W.11-12.1.b

Develop claim(s) and counterclaims fairly and thoroughly, supplying the most relevant evidence for each while pointing out the strengths and limitations of both in a manner that anticipates the audience's knowledge level, concerns, values, and possible biases.


Acquire and use accurately general academic and domain-specific words and phrases, sufficient for reading, writing, speaking, and listening at the college and career readiness level; demonstrate independence in gathering vocabulary knowledge when considering a word or phrase important to comprehension or expression.



  • Begin this lesson by asking students what they know about the national debt.
  • Then explain that they will explore the national debt, its categories and its effects on a country's financial system.
  • Distribute the copies of the What is National Debt? - Definition, Effects & History text lesson.
  • Select a student to read the 'Definition' section, then start the following discussion:
    • What is the difference between internal and external debt?
    • Quickly use technology to define treasury bills and the central bank.
    • Identify and explain the three categories of the national debt.
  • Now select another student to read the 'U.S. National Debt' section, then pose these discussion points:
    • Who loans the federal government money?
    • Identify the purpose and use of those loans.
    • Analyze the U.S. Debt Limit graph and discuss your findings.
  • Next, have another student read the remainder of the lesson, then ask the following:
    • Identify the three negative effects of borrowing.
    • Discuss how high interest rates affect the U.S. government's ability to borrow money.
    • Explain the correlation between high interest payments and business tax incentives.
    • When the national debt is high, discuss the mindset of the majority of politicians.
  • Afterwards, distribute the lesson quiz and allow students to complete independently, in pairs or groups.

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