When federal outlays exceed tax receipts, the government typically borrows money from domestic or foreign creditors. When national saving is low relative to national investment, government debt is more likely to be purchased by foreigners. The share of public debt held by foreigners rose from 15 percent in the 1970s to 24 percent in the 1990s. By 2003, the share had reached 37 percent--the highest level in at least 40 years. A rising average share implies an even more steeply rising foreign share of new debt issues.