National Debt Causes

Overspending is a pertinent problem facing the lawmakers in Congress. In 2012 discretionary spending reached $1.3 trillion and mandatory spending $2 trillion, while only bringing in $2.5 trillion in revenue. Since the turn of the century back in 2000, non-mandatory spending by the government has topped out a whopping $16.1 trillion just in the past 13 years (Boccia, Frasser & Goff 2013). This persistent overspending on programs and services that are not necessary to the functionality of the country is what is causing the deficit to rise year after year. To remedy this issue the government must either increase the revenue it brings in through taxes and trade or reduce the amount of money it spend or perhaps even both. In 2012 thirty-one cents of every dollar that Washington spent was borrowed (Boccia, Frasser & Goff 2013). Most of which went to large programs such as Social Security and Medicare and if these large, growing programs, or just the budget in general, do not undergo financial reform it could spell disaster for the economy and fiscal state of the nation.

This growth in national debt has blunt consequences on inflation, interest rates and growing economy. Foreign control of large amounts of government debt means that the taxes will have to be raised to repay debt and percentage owned to overseas governments which is not acceptable. Assuming that trade deficiency also exists it will lead to depreciation of dollar which effect its position as a reserve currency, and if during this process any new currency emerge as a replacement of reserve currency, higher interest rates will be required to sell the debt to foreign countries (Inflation). Raised interest rates have a negative impact on the economy and high accumulation of debts leads to high interest rates (Spending). Hence the economy suffers. This means that the funds for government programs like Social Security and Medicare are not enough (Economic Progress Under Obama). Another consequence of high national debt is the reduced flexibility in fiscal policy (Spending).

The federal budget deficit is a much discussed and little understood subject in American politics. The current recession has dramatically decreased tax revenues, driving the United States federal government to increase spending in an attempt to stabilize the economy. As a result the current federal deficit is at over $1.3 trillion dollars. This is approximately $47,754 per U.S. citizen or $137,552 per U. S. taxpayer (U.S. Debt Clock: Real Time, 2012).

The amount of money that the United States government owes as of October 17, 2004 at 03:48:52 pm GMT was $7,435,016,998.21. The debt has increased by an average of $1.7 billion per day since September 30, 2003! From a more individual perspective, currently the United States population is roughly around

“Today I face you and say the challenges are real. They are serious and many,” Obama stated on inauguration day. Obama need to pull things together with bold and quick actions. Yet it seemed that borrowing was the only answer to this out of control situation. And he did just that, taking hundred of billions to bail out the banks and other institutions; tens of billions more for the auto industry; $275 billion for homeowners and the mortgage lenders; and $787 billion stimulus package to jump-start an economy spiraling downward. Much like the Bush administration, Obama and his administration are borrowing just as much, added to the deficit. It is unclear what exactly the future will look like for America as the economy is spiraling downward and other countries are becoming stronger.

You may be asking yourself how america got in so much debt well it starts like this for example the capitol building ran out of light bulbs. The company selling them sells a 6 pack for five dollars, but since they are the government the lightbulb company charges them 30 dollars for it, but that's only 30 dollars compared to the 4 trillion dollar budget well add on buying overpriced paper, pens, pencils, tools, plans, ships, and

Today the United States faces many challenges, challenges that mirror the changing world we live in as well as the changing dynamics of our country as a whole. There is more than a few issues on the horizon for America, and many of these issues can be tied directly to government expenditures. Not the least of which is our current position on social security spending; arguably becoming the largest Ponzi scheme the world has ever seen. However, it is the details that really accentuate the complexity and scale of this ever growing budgetary concern. In 2012 social security spending totaled 819.7 billion dollars. Making it the number two largest expense in the in our government spending structure, second only to defense by a

Many Americans today are aware that the United States is in debt, however, some may not realize by how much. Currently, the United States National Debt is up to 18 trillion dollars and is steadily increasing. This is a serious problem for the U.S., especially for millennials, who are going to be the ones living and dealing with the debt left behind for them. Increased spending, borrowing from China, and interest on the money borrowed are setting up our economy for an eventual crash, one that the upcoming generation may not be prepared for. Every dollar that accumulates into the debt will have to be repaid with interest at some point, making it harder to pay back. To gain a better understanding of how the U.S. dug itself into such a deep hole, one should start at the beginning of where the debt started.

The federal budget is known as the notorious economic tank from which money is distributed to various programs. The money used every fiscal year, which begins October 1st and ends September 30th the next year, belongs to the people. The government raises this money through taxes and they spend it on national defense, Medicare, and social security. The federal budget is an exercise in making choices, and those options will certainly affect individuals living in the U.S. These choices cause debt to pile up on the government, who is struggling to make it disappear. The deficit and debt of a government gauges how well it is being run and how well it has been run in the past. According to The Economist the national debt is the total

The United States national debt is large. The U.S. Debt-to-GDP ratio has grown to over 60 percent in recent years. We are more than $15 trillion in debt. In this paper I will address the federal budget, the United States debt, and the resulting impacts on society in several sectors.

In 2009 the debt was amounted to about $12 trillion , or 83.4 percent of the country’s GDP (“Budget of the United States Government: Historical Tables Fiscal Year 2011” table 7.1). Since 2003, the debt has been increasing by more than $500 billion annually. The increase in 2009 was $1.9 trillion. According to the Congressional Budgeting Office, this debt will keep increasing at least for the next decade (“The Budget and Economic Outlook : Fiscal Years 2010 to 2020” 21).

The healthcare and social security programs, and the defense budget expense are only some of the few causes towards the government debt. Out of the many causes towards the debt, there are a few in which have caused the most debt. Two of those, are the tax cuts that happened while George W. Bush was in term, and the Iraq, Libya and Afghan wars. These two situations are part of the reason that government is facing large debt. As the debt continues to grow, it will affect people greatly. Interest will become high in order to start paying off the government debt, plus while the debt is still high, jobs will be limited and salaries will continue to be rather low. Also, "Increases in interest rates will cause borrowing to becoming difficult at all levels, including those for individuals, corporations, and mortgages," (Investopedia). Along with the government debt, education throughout American is huge issue as well. The Brown V. Board Education was a case in which declared laws establishing schools for African American and white students to be unconstitutional. After many years, there are school systems that still separate the

The author, Greg Ip, clarifies in this article that the debt that was acquired during the downturn of the economy and today is not what we should be concerned about for the growth of the economy. He explains that the copious amounts of debt that we should be worried about is what is yet to arise. These so-called debts did include the baby boomers who were retiring and who were requiring their Social Security and Medicare, which will then send the economic debt skyrocketing. Nevertheless, he states that the fiscal budget has been described as better than in the last couple of years, for a few distinct reasons. This article states that one reason for this is because of the over-all deflation in health-care due to the affordable

The National Debt consists of the total debt accrued by local, state and federal. Public debt is essentially the federal debt, thus compiling the staggering number that already exists. The debt deficit to me is astonishing. Currently, the total public debt in the United States, as of December 16, 2015, is $18,788,138,221,346.49. This includes $13,600,726,418,253.26 debt held by the public and $5,187,411,803,093.23 by intergovernmental holdings (usgovermentdebt, 2015). High GPD is not anything new to the United States. The all-time high was 121.70 percent ($18827323.00) in 1946 and a record low of 31.70 ($253400.00) percent in 1974 (United States Government Debt to GDP, 2015). The way we are spending, and the debt we are accruing, it would

Throughout most of the country’s history, the United States’ federal government maintained a reasonable level of national debt. For example, the total national debt in 1981 was $998 billion. Since then, however, the government has generated significant budget deficits, and the level of debt has risen to $16.7 trillion in 2013 (Calleo, 39). Budget deficits are caused