Even though there are other areas of concern such as military, education, and social security that the government needs to allocate spend to, reducing the national debt is what our government officials should be their primary expenditure considering how large our debt has gotten to. If the Government does not find a way to reduce its expenditur... ... middle of paper ... ...security. If the government primarily allocated spend to these areas or primarily on the people, then our economy would suffer. In other words, if the U.S. government ignored its debt and only concentrated on its people, the debt would continue to rise and would take longer to pay off. The government needs to start allocating more money to debt and get it paid off so that officials could then make its main focus the citizens.
Even though the economy could benefit from the budget deficit such as economic growth, the economists do not want to take a chance on that. Also, some economists are also concerned that higher borrowing by the government may also openly result in reduced utilization spending. They argue households recognize that higher current government borrowing results in highe... ... middle of paper ... ...ful spending because it is taking a toll on our future, our children’s future, and our children’s children future. Works Cited 1. Case.
The GAO is responsible in making sure that the government spends its money on what is has budgeted for. A continual aspect of the budget, is the deficit. Franklin Roosevelt believed that the government should spend more than it took in, in order to get the economy running again. He thought this would be a temporary adjustment to the budget, but it remained. When the Balanced budget came around, there were a lot of people who protested it.
Over time, this process (along with a steady dose of inflation) is intended to reduce the national debt-to-GDP ratio by literally de-valuing government debt. But such a policy cannot be pursued or executed without raising certain questions and creating certain controversy. The following paragraphs will attempt to explain this concept in more detail, and discuss the pros and cons of its implementation by the United States. Past situations in which governments have found themselves under such indebted circumstances have taught us that there are usually the same handful of solutions that can be used to rectify a struggling economy. The first is economic growth, to where the GDP grows at a fast enough rate that the economy is literally able to grow their way out of their debt.
When the government engages in fiscal policy it basically decides what products they want to purchase; what payments it wants to dispense; what taxes it’s going to collect or cut. Fiscal policy directly affects the budget and the deficit. The difference of what a government spends and what it gains in taxes in a given period is known as a budget deficit and there are many reasons how this can happen. For instance, if our government keeps spending money that does not exist, obviously the more debt will accumulate. The government cannot keep this up without creating more debt.
We need to begin today, by making spending cuts ACROSS THE BOARD. These cuts must be enacted sensitively, however, in order to keep the economy stable as we move toward a balanced budget. The need for spending cuts across the board cannot be understated. For just one example of how imbalanced our policies are, notice how 63% of all entitlements go to retirees. 93% of these are NON-MEANS-TESTED.
If the amount of tax is not sufficient to cover the liability, the result is a deficit. The government will determine the best method to offset this deficit, such as raising tax rates. The rising government debt can also lead to the reduction of the nation’s credit rating, potentially leading to a lower standard of living for generations to come. Per a report from ABC News, “savings of taxpayers may diminish in worth, the economy could see a lag in wage increases, and create fewer jobs” (Drowning in Debt, 2010). Social Security and Medicare Users The U.S deficits, surpluses, and debts affect Social Security and Medicare users, because when the economy is facing any of these problems one of the ways the government acquires the funds to help is by drawing on the funds availab... ... middle of paper ... ...as debt measures against the country’s GDP.
Because deficit occurs when the State expenditures exceed receiving in concrete to year, the government should control this process. When there is not enough money in budget, government borrows money from all different countries. Finally, we encounter with more problems. It does not help us to get out of the debt. Theoretically, the government has to choices to solve this problem.
There are many other plausible theories but they are less realistic according to the way the Government works. In conclusion, The United States National Debt is trillions of dollars in “the hole”. America`s wealth is lacking as the debt is a growing problem. If we are unable to solve this rubix cube of a crisis, America may never regain its former splendor. This gigantic debt must be solved in order to restore wealth to the nation as a whole.
National debt is increased even more when people abuse credit, accepting debt into their lives. Unless America focuses its efforts to discouraging materialism by spending less money than what its overall income is, it will proceed further into debt, risking even higher taxes and bankruptcy. Our nation has to overcome its nurtured materialism before we can truly expect to improve its economic status.