Every day in New York City, hundreds of people walk past a huge digital billboard with giant numbers across its face. Each person who walks past this billboard sees a slightly different arrangement of numbers, growing larger every second. This board is the National Debt Clock, representing the over 14 trillion dollars currently owed by the United States. While some people claim that the national debt is caused by the falling economy, most maintain that the debt itself causes the poor economy (Budget Deficits 2007). Rising debt leads to higher interest and investment rates, and cuts into our national savings. Ignoring the national debt leaves the major burden of paying it off to later generations, while meanwhile allowing our country’s economy to further drop and our dependency on other nations to rise. What is the national debt? National debt is how much money the nation owes to states, foreign countries, and any other “creditors who hold US debt instruments” (National Debt vs. National Deficit). The national debt is different from the national deficit, or budget deficit, which is the difference between the amount of money the United States makes and how much it spends on a yearly basis. The budget deficit makes up a significant portion of the national debt . The US has been in and out of debt countless times throughout history, going as far back as the Civil War. However, debt did not become a truly relevant problem until much later, in the 1980s (Budget Deficits). Up to that point, large budget deficits were generally only allowed during wartime, but this pattern ended after the Great Depression. Roosevelt’s New Deal meant that the government spent much more than it previously did, even after the economy improved (Budget De... ... middle of paper ... ...“Obama Stokes Deficit Fight.” The Wall Street Journal Politics. The Wall Street Journal, n.d. Web. 6 June 2011. . McManus, Doyle. “Drawing Budget Battle Lines.” Editorial. Los Angeles Times. Los Angeles Times, 14 Apr. 2011. Web. 5 June 2011. . “The National Debt (sidebar).” Issues and Controversies. Facts on File News Services, 23 Jan. 2009. Web. 25 May 2011. . Silverleib, Alan. “House Rejects Debt Ceiling Increase, 318-97.” CNN Politics. CNN, 31 May 2011. Web. 6 June 2011. . US Debt Clock. N.p., 31 May 2011. Web. 31 May 2011. .
The movie IOUSA is a documentary that draws attentions to the impact and magnitude of federal debt to the United States of America. It explores the history of the US federal debt since the independence day and the major events and the action that were taken. The movie discusses four major type of fiscal deficits demonstrating the irresponsibility and danger in each one of these types. These four sections are: the budget deficit, saving deficit, trade deficit and finally leadership deficit.
The dollar will be worth less and less if the nation is in high debt. People will also be affected, when you have less money you spend and buy less due to increased prices, which can cause problems in the economy such as a recession or worse a depression. Budget deficit calls for the government to let costs exceed national income and use monetary policy to jump start the economy. The government must be careful when choosing the best way to build the economy. If the policies fail, they can lead the nation into many problems, as stated above.
When you get to the point where debt becomes too much you begin to search for a way out. There are many different options to get rid of their debt; one option is the debt snowball. This debt relief option sounds more unusual than it really is.
Washington Times - Politics, Breaking News, US and World News. 6 Jan. 2010. Web. 16
Perhaps Roosevelt’s greatest blunders occurred in his attempts to fix the economy. The Nation claimed that “some [of his programs] assisted and some retarded the recovery of industrial activity.” They went so far as to say that “six billion dollars was added to the national debt.” All of this is true. Roosevelt’s deficit spending, provoked by the English economist John Maynard Keynes, did add to the already high national debt while his programs did not solve the record-high unemployment rate. This “enormous outpouring of federal money for human relief and immense sums for public-works projects [that] started to flow to all points of the compass” and nearly doubled the nation’s debt also brought about many changes that were, in a large sense, revolutionary (Document C).
Gerson, Michael . "The real-world effects of budget cuts." The Washington Post 7 Apr.2011: n. pag. Print.
Skiba, Katherine. "House Republicans and Democrats Debate the Economy - US News and World Report." US News & World Report | News & Rankings | Best Colleges, Best Hospitals, and More. US News, 26 Feb. 2008. Web. 22 July 2011. .
However the interest we pay on our nation 's debt is very small compared to the overall budget. According to the Center on Budget and Policy Priorities only 7% of the total budget is spent on interest which is relatively low compared to things like social security which took up 24% of the budget in 2014 (Policy Basics). As long as the United States can continue to keep the interest rates low the debt will continue to be a begin threat. If the creditors of the U.S. were to spike their interest rates, America would be in trouble, however America has fairly good credit, and it should remain that way unless there is another scare like the government shutdown in 2011 (Riley). Overall the threat of the nation debt is a very minute problem in the grand scheme of things. According to The Richest, only five nations in the entire world are completely debt free, which is astounding when you consider that there are about 195 countries in the entire world (Mathers; How Many). These figures show how extremely difficult it is for a country to run without having a certain amount of debt, and America having debt should not be a concern. America is not even in the top ten countries whose debt make up the majority of their GDP (Country List). Which means that at the moment American’s should not be overly
The national debt is usually a frightening topic citizens of any country, however, in the United States, twenty trillion dollars of national debt is one of the major fears of the economy. Along with this fear comes every politician claiming to be the person to lower this astronomical debt to ease concerns in the modern American economy. In Hamilton’s Blessing, John Steele Gordon tries to alleviate these concerns by showing a plethora of benefits and good the debt has been able to do throughout the history of the United States. The central premise of the book and the main guideline for John Steele Gordon’s thinking is that the debt was used to save the Union in the 1860’s, the American economy in the 1930’s, and the wellbeing of mankind during
A large increase in government debt occurred during Ronald Reagan’s presidency in the 1980’s. Ronald Reagan was dedicated to decreasing taxes a...
Lott Jr., John R.. At the Brink: Will Obama Push Us Over The Edge?. Washington DC: Regnery
U.S Federal Deficit and Debts:Understanding the history and context. (2011, November 1). Utah Foundation. Retrieved January 25, 2014, from http://www.utahfoundation.org/img/pdfs/rr7
Cox, He, Mclean, Russel, Tse, Waananen. (2011) . Charting the American Debt Crisis, New York Times- Politics
Whitehouse, Office of Management and Budget (OMB), 1 Jan. 2009. Web. 13 Apr. 2014. .
The United States is trillions of dollars in debt today, increasing more and more everyday. 8 in every 10 americans are in debt due to the tremendous amount of using a credit card, as well as, purchasing a home and paying the mortgage. (The Complex Story of American Debt pdf) As this is true, many people still continue to go into more debt everyday. There are many diverse types of det as in credit card debt, mortgage, etc. Nearly 9 in 10 (89%) have some type of debt, ranging from cars, education (college student loans), mortgage, and credit cards. (The Complex Story of American Debt pdf) This is because of the “American Dream” lifestyle many Americans want to live by, a lavish life with nice, expensive cars, a big house, and money to constantly spend on other wants. These acts will just effect the national debt by increasing it more