The Effects of National Debt on the Economy

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.

The recent clash between the president and congress about raising the debt ceiling made the front page on every newspaper throughout the country and generated controversy of unimaginable proportion among the citizens of the United States of America (College for Financial Planning). No macroeconomics issue is more controversial today than the impact of large public debt on the economy and on future generations, but, however, there appears to be a huge disconnect between professional, political leaders, and the ordinary public about the national debt and its impact on the current and future

A nation’s economy plays a vital role in how a nation operates. The United States economy faces a large variety of problems in this paper; we will focus on 4 major economic problems, unemployment, inequality, federal debt, and the financial/credit market. All four issues are interconnected in some way with deep social and economic implications. These issues were emphasized during the Great Recession that hit the U.S. economy in 2007.In the following paper, we will look at each of the four topics individually as well as look at how each plays a significant role in one another’s overall impact on the U.S. economy as well as individuals in the United States. The United States plays a crucial role in the world economy, meaning that every issue and difficulty faced the United States economy has implications far outside the U.S., understanding how these issues relate to one another sheds insight into just how connected every area of the economy actually is.

Food Stamps are provided for many families in the hope that these families will not starve and can put filling, nutritious food on the table. According to the Food Stamp Act of 1977, this program was enacted to ““to alleviate hunger and malnutrition … by increasing food purchasing power for all eligible households who apply for participation.” (usda.gov, 2013) Recipients can use these just like regular cash at any local grocery store. They also may receive Medicaid. This program provides for many the medical treatment they would not be able to afford otherwise. This is especially true for children and pregnant women below the poverty line.

“Ten Trillion and Counting,” presented by Frontline provides quite a picture of America’s national debt as it surpasses the trillion dollar mark. They ponder the financial well being of current and future retirees while also exposing on how America got into this mess, and what the Obama administration plans to do during his term. America is able to close the gap year to year in its national budget by selling bonds and T-bills. Foreigner countries who continually purchase these obligations are beginning to grow. Much like the Bush administration, the Obama administration has started borrowing big with plans to cut the budget years down the road. It is clear for anyone to see that this borrowing and the future promises of cutting cannot go

The American Recovery and Reinvestment Act of 2009, otherwise known as the Stimulus Bill, was one of the first major pieces of legislation passed by the new Democratic Congress in 2009 and signed by newly inaugurated President Barack Obama. The legislation was an attempt to take the United States economy out of a major recession through federal spending. The motivation for this bill was the collapse of the housing market bubble and the mortgage crisis. A result of these problems was the decline of consumer and corporate credit, causing monetary liquidity in the economy. Obama argued that the economy needed a “jump-start” to get moving again; that being the stimulus of 2009. Drafts for the bill called for as little as $275 billion in spending,

The U.S. national debt is currently $18 trillion dollars and it is rising fast. The national debt today is the highest the U.S. has ever seen. In George Washington’s Farewell Address, he declared the U.S. should avoid going into debt. If the nation end up in a deficit, that the debtors were responsible for paying off the debt so that it doesn’t burden the future generations. Like the rest of this advice in his Farewell Address, the nation ignored it. The ideal goal right now should be to stop the debt from increasing anymore because it is impossible to stop the debt from increasing and expect to pay it off in this generation.

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 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.

We hear about the debt almost every day: news talks about it, politicians argue about it, even President Obama gives speeches on it. So what is the significance behind it? In this article I am going to explain briefly what the national debt is, how big it is, and what it has to do with us.

In this report, the Great Recession and the current economic down turn in the United States will be discussed. This report will cover the definition of both a recession and depression, and how these two differ from one another. The report will then detail two significant factors that were involved in the formation of the Great Recession. Finally, the report will discuss the differences and similarities between the Great Recession and other recessions that have taken place in recent U.S. history.

Fiscal policy: Given the breadth and depth of this recession, it was clear that the Treasury and the entire Obama administration had to take bold actions. In fact, right at the beginning, they were committed to a fiscal stimulus policy package which would be “substantial” enough to pull the economy out of the recession. The final stimulus package signed into law in 2009, the American Recovery and Reinvestment Act, was totaled $787 billion including about one-third tax cuts and one-third aid for states and the unemployed. Of the rest, labor health and education investment got 8%, and infrastructure investment got about 7%. It also included a large amount of government money to

The economic meaning of a recession is that the gross Domestic Product (GDP) has declined for two or more consecutive quarters. Unemployment rises, housing falls, stocks fall and the economy is in trouble. Whenever the government sees that the economy is entering a recession it is important for it to act. The U.S acted in two ways during the Great recession of 2008 through fiscal and monetary policies. Renaud Fillieule identifies that “ Monetary and credit expansions have been the main tools used by the U.S. government and central bank to try and recover economically from the Great Recession of 2008” (Fillieule r, Pg. 99 2016). These Keynesian policies are debatable among economist, none the less they were implemented and put the U.S on the road to recovery.

As inflation causes the economy to change, minimum wage has decreased in value as inflation has caused the economy to change. A minimum wage that might have been enough to support a person a couple of years ago would not be enough to support a person now. For instance, in 1980, minimum wage was about $16,647 dollars a year, but an apartment in Manhattan, New York was only about $10,400 per year in rent, leaving about $120 dollars a month for other expenses. Now, minimum wage is about $13,195 per year, with an apartment in Manhattan being around $7,200 per year in rent, not counting utilities, leaving about $5,995 for other expenses. Keep in mind that food, gasoline, utilities, and other essentials were much cheaper in the 1980’s than they are now. An average household spends about $294 per month (Loweryourspending.com), or about $3,528 a year, on groceries, leaving about $2,467 for the rest of a person's expenses.

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