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Anonymous asked in Politics & GovernmentGovernment · 9 years ago

the US national deficit?

hello, i am doing a term paper on the US national deficit. the first part of the paper is why this issue is problem. so, seeing as the US deficit is approximately $14 trillion, i would say there are quite a few effects that can result from this if we continue to further this deficit spending. i am looking for some possible larger effects, not "smaller" things inflation, increased taxes and interest, decreased gov't benefits... for example, if we continue to drive ourselves into debt even more, than we could go bankrupt, and we would be extremely vulnerable at that point, and a country, say china, could easily resume command.... big issue like that... thank you all.

Update:

by the way, sorry for the abundance of grammatical errors above... im in a bit of a hurry, and i re-read my post, and realized i sounded completely uneducated. sorry!

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  • 9 years ago
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    The deficit is the annual difference between outlays and revenue. The debt is the sum of the annual deficits minus any surpluses.

    The fact that the US may try (and in ways is already trying) to print money to buy up debt, which decreases the value of the currency (hence inflation), or may have to raise taxes to drive down deficits (even though it is more likely that that money will be spent by Congress), or will have to offer higher interest rates to would-be lenders in order to get them to purchase bonds, are all large effects.

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  • Anonymous
    9 years ago

    The continued devaluation of the dollar could eventually lead to it's collapse. This is what brought the former soviet union down. There are some very interesting parallels between what is occurring right now in america and what occurred right before they collapsed.

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