Total indebtedness including that of federal and state governments and consumers has fallen to 3.29 times gross domestic product, the least since 2006, from a peak of 3.59 four years ago, according to data compiled by Bloomberg. Private- sector borrowing is down by $4 trillion to $40.2 trillion.
When people talk about debt in a public setting, they're almost always talking about the national debt.
But the national debt is only one slice of the total debt, and it's the most sustainable, since it's the only type of debt that is really backed by the national printing press. Furthermore, it's the private debt (household debt) that really crushed the economy, and is still something of a drag on the economy today.
And that's where we've seen the improvement.
Here's a look at just Household Credit Market Debt Outstanding/GDP, for example. It's definitely gone back years.
Here's another showing non-financial corporate debt as a share of GDP.
Financial sector debt as a share of GDP is basically where it was at the start of the century.
You get the point. In basically every area besides the Federal national debt, the US is really kicking the debt habit.