The Debt Crisis Of The American Nation And All Around The World

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In the American nation and all around the world, the spending is increasing and the revenues of the households are falling (Truth, 2010). It was noticed in the year 2010 that the spending was about 24 percent of the Gross Domestic Product (GDP) hence this has made the federal budget to increase drastically from 33 percent to 62 percent in the year 2010. Therefore, another reason for the “debt crisis” is because of the federal spending which is projected to increase at a father rather than the rate at which the revenues are generated. Hence it was stated by The Congressional Budget Office (CBO) that if the deficits keep on increasing at this pace, they are projected to be increased to about 90 percent in the year 2020. If this occurs, it will be a major setback for America and for the whole world. Another reason for the “debt crisis” is the increasing expanses that cannot be avoided. These include health care costs which keep on increasing every year hence making the individuals to contribute more of their pays towards this. Due to this reason, the interest rates rise hence affecting the economy as a whole. Government also has to pay for other services which include the homeland security, the national defense and the energy that is required for the society, therefore this contributes towards more spending and lesser revenue. It has been estimated that by the year 2020, the interest on debt will rise to $ 1 trillion. This money that is spent is not for the buying of any goods
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