Debt In America

There is a widespread concern about rising levels of debt. Debt can become disastrous for those who live alone or those families who are already having problems with supporting their family. The people who might be struck by debt, they might have trouble recovering. Debt can cause Americans to lose their homes and stability they need to feed, and shelter their families. Although debt comes upon us Americans quickly, people can see debt as terrible thing to be stuck with. It has many disadvantages that can devastate to people.

Many United States' citizens are unaware of the country's current financial state. Many assume that one of the world's wealthiest countries could never be in debt. This is untrue however, and, in fact, the country with the greatest income per capita is in major debt. This study will examine possible solutions to reducing the United States' national budget deficit.

On the Sixth Avenue in Manhattan, there is a national debt clock that shows the amount of United States national debt. The clock was first installed in 1989, and can show up to ten trillion dollars. It ran out of digits in October 2008 when the sum of debt exceeded the amount. A new clock with two extra digits is going to be installed (Izzo 2 ).

Neither Republicans nor Democrats appear to have any sense of urgency in rectifying this problem. Fortunately the U.S. Government has a good reputation of paying its debts and thus has a good credit rating which allows it to continue borrowing, although that good standing was put to the test recently in 2011 when Standard& Poor’s reduced the U.S. rating from AAA to AA+.

As of January 2012, Congress raised our debt limit to $16.4 trillion. That is an extreme amount of money and almost shocking to hear that we owe are behind that far. It makes you think, what have we done so wrong to be in this current situation? What could we have done differently in the past to not be here? These questions need to be raised everyone involved in this mess and it needs to be figured out. Congress has the ability to raise the cap limit, which they have often done in the past, but say that this time, if they don’t see serious plans, the limit won’t be raised. The US Treasury has enough “tools” to keep the government afloat into early 2013 but after that, it’s up to the strategies we have put into play to execute. The government is spending $3 for every $2 it takes in according to the Urban Institute. That is a stat that needs to be the opposite way if America plans on seeing changes in the near future.

During presidential bids for the White House and Congressional deadlines for increasing the debt ceiling, huge debates break out as to the enormous amount of debt incurred by the federal government. Throughout our nation’s history, national debt at this magnitude is a new things. The accumulation of this amount of debt has its consequences, especially when the debt hits the nations GDP (Gross Domestic Product), or the revenue the nation takes in per year.

Some of the hardest decisions people contemplate are determining how to handle their finances, especially when funds are plentiful. More to the point, few people seek counsel from professionals who are trained to assist them. Consequently, they are likely to become entangled in debt and ill prepared for times when funds are low. While there are a number of reasons why individuals fail to seek professional assistance as it relates to managing money, there is evidence that this is not supported biblically. Proverbs 13:10, states that, "Through pride and presumption comes nothing but strife, but [skillful and godly] wisdom is those who welcome [well-advised] counsel (Amplified Bible).

Despite the year 1835 when Andrew Jackson eliminated all national debt, America has always remained under some level of debt. Recently there has been a large amount of fear surrounding Americans debt. In 2014, a Gallup poll found that 58% of respondents worry about the federal deficit a great deal. Following Congress raising the debt limit at the end of October, the government experienced the largest single day increase in debt on November 3 (Korte 1). This large increase follows the recent trend of exponential growth of the debt. As the debt continues to grow without the government reducing spending or increasing taxes many citizens and economist are concerned over the debt. In June, the congressional budget office described in a report

The federal government’s debt is the total value of all outstanding government bonds and the accumulation of past deficits. Before the federal government had assumed the liabilities of CMHC which was $236,708 million dollars as of September 30, 2015 and the liabilities of commercial banks, growth in Canada’s Gross Domestic Product (GDP) had been forecasted to be low due to continual fall in oil prices in the last six months which has lead to a significant depreciation in the value of the Canadian dollar and considerable declines in the federal government revenue.

The National debt of the United States is currently sitting at over $19 trillion dollars. There are many public opinions on whether or not this is a risk to the US economy and if this will lead to our next economic collapse. The National debt is the amount owed by the federal government to all of those who hold the notes. The outstanding Treasury securities at a point in time that have been issued by the Treasury and other federal government agencies is the measure of public debt. When we talk about national deficit and surplus we refer to the government budget balance from year to year, not a cumulative total of all debt. I want to review the background of the US debt, how it has reached its all-time highs along with the components, our obligations, measurements, risks, and foreign holdings and also discuss if there are causes for concern.

We believe that if Washington could see us now he would be very upset that we are $19.5 trillion dollars in debt. We think that he would be confused on how we went from what $77 million to $19.5 trillion in debt. He would also be confused on who was willing to give us that money. We also believe that he would be concerned that we have such a big debt and that 67.5% of the debt is to our own people and only 32.5% is to other countries. He also would have been a little bit worried about how much we borrow from others. He probably would have wanted us to stop borrowing as often as we do and only borrow when extremely necessary.

America's debt is the largest of any single country, in the entire world. The debt levels are rising and pose a serious threat to the U.S economy. This issue needs to be acted upon and solved with urgency before it becomes a crisis, similar to Greece.

The supply of general gross debt for advanced economies increased significantly over the past years compared to that of emerging economies, especially after the onset of the financial crisis as illustrated in the graph below:

The true origin of debt is unknown but research has been able to see many old civilizations that dealt with money. Many argue that money does not buy you happiness however then explain how money dictates the lives we live. Money has a large effect in our lives but we do not realize this until we grow up and become aware of this ourselves. Nevertheless, how was debt created that we would owe an amount of money due to us borrowing it and using it for our personal pleasure? Without going in the topic of debt and money too much, we were taught at a young age how money has created a mass effect. Such as wars have been declared due to finances and using money to buy labor from other humans (slavery) have been the most notorious events that correlates to money.

Is it to be, or not to be? Frankly, if our nation does not strive towards a solution for the National debt then it will not “be”. Some economist determined that the Country’s national debt is not an issue to panic over because the Nation will supposedly continue as it does currently. However, the National Debt that the country has reached is a problem that cannot be ignored or solve its self and vanish, it is a problem that has to be addressed. Eventually the time will run out for the United States to keep pushing the limit on the debt ceiling and then will be left without options.