National Deficit and National Debt Essay - 982 Words

The growing national deficit is a looming problem in the United States now more than ever. The national debt is constantly increasing and government spending is out of control. If these issues are not solved then they could spell disaster for the nation’s economy when the infamous debt ceiling is finally reached. Currently the national policy on the debt is to continue raising the debt limit until a solution is found that is agreeable between both parties in Congress. The two main issues of over spending and the constant raising of the debts ceiling by Congress can both be resolved by government spending reform, balancing the federal budget and initiating pro-growth policies in order to increase the government’s tax revenue. The debt†¦show more content†¦The other issue that is facing the American government is overspending. Overspending is a pertinent problem facing the lawmakers in Congress. In 2012 discretionary spending reached $1.3 trillion and mandatory s pending $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. Government spending in the United States needs to change and it needs to change soon. As mentioned earlier, in 2012 nearly a third of governments budgetShow MoreRelatedFederal Deficit And The National Debt1661 Words   |  7 Pagesyears of the federal deficit and the national debt, as well as examination their relationship. This paper also looks at how the deficit is created and dealt with, along with what happens to different areas of the economy when the deficit’s size changes. Lastly this paper covers who owns the national debt, how these people are paid off, and the interest rate of the debt. 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Public policy is defined as a â€Å"system of laws, regulatory measures, courses of action, and funding prioritiesRead MoreThe Federal Budget Deficit And National Debt870 Words   |  4 Pages The Federal Budget Deficit and National Debt Basically, what the federal budget deficit is a shortage of funds that are available for the government, where more money is being spent than what the government receives. But, national is where the government borrows money through various ways. The data for national debt and federal budget deficit from the year 2001-2013 is given in the chart above. As we can see in the graph, the deficit is still remains in our economy even though there hadRead MoreFederal Budget Deficit And The National Debt1524 Words   |  7 Pages These two graphs are dealing with the federal budget deficit and the national debt and just how diverse they are from the time differences with both begging approximately in the 2001’s and making their way to 2013. Different types of numbers, but the relationship between the Federal budget deficit and the national debt is by how the Deficit deals with taking the difference of what the U.S. government gets in from taxes or other revenues calling these receipts, but on top of that the amount of moneyRead MoreThe Federal Budget Deficit And The National Debt747 Words   |  3 PagesAlvarado ECON 2301.SY2 The Federal Budget Deficit and the National Debt 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 our textbook, â€Å"Principles of Macroeconomics,† the relationship between debt and deficit is described. A deficit is a shortfall in revenue for a particularRead MoreNational Debt and Budget Deficit Essay652 Words   |  3 Pagesvarious taxes and fees and the expenses are what the U.S. government pays out for national defense, highways, social welfare programs, and various other programs. In an election year, the average citizen is apt to hear a great deal of talk about income, taxes, spending, and more importantly budget deficits and the national debt. Given all of the talk, one may come to think that budget deficits and the national debt are one in the same. While the two do go hand-in-hand, it is important to understandRead MoreNational Debt Vs. Federal Deficit1345 Words   |  6 Pages National Debt vs. Federal Deficit What word begin with â€Å"d† ends with â€Å"t†, and has to deal with the nation s budgets? Well if you guessed debt, then you are absolutely correct. Or deficit, because both fit the criteria just fine. Though these words look alike, they are not interchangeable. The difference between the two is that while the national debt is getting bigger the federal deficit (as of 2014) is increasingly becoming less. As of last year it was said that the Obama administration wasRead MoreBudget Deficit And Its Effect On The National Debt1403 Words   |  6 Pagesgovernment can use the surplus revenue to pay off the national debt. The budget deficit is the annual amount the government has to borrow to meet the shortfall between current receipts (tax) and government spending, for example by the end of 2009-10 our annual deficit was  £170.8 billion. The argument of the chancellor is that with national debt ‘unsustainably high’ periods of economic growth should be taken as an opportunity to pay down debt and reduce the burden for future generations. To analyseRead MoreAnalysis Of The Federal Budget Deficit And The National Debt1642 Words   |  7 PagesTHE FEDERAL BUDGET DEFICIT AND THE NATIONAL DEBT Morgan Sibley The Federal budget deficit is the amount of spending by the Federal government that is in excess of how much money the government brings in annually. While the Federal budget deficit has steadily decreased overall during the past fifteen years, our Federal debt continues to grow at a drastic rate. A review of how the Federal deficit has evolved over the past fifteen years, the rate of growth of the Federal debt during that same periodRead MoreA National Debt Is The Difference Between The Government s Budget And Deficit And The Expenditures1291 Words   |  6 Pagesway, a national debt is the difference between the government’s budget/deficit and the expenditures. The U.S. federal debt was set up by the first Treasury Secretary, Alexander Hamilton. Our initial debt incurred during the American Revolutionary War. Over the following 45 years, the debt grew. Although, the national debt actually shrank to zero by January 1835, under President Andrew Jackson, it quickly grew into the millions again, soon after. The American Civil War resulted in dramatic debt growth