Reducing the United States Debt Crisis

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Table of Contents

Introduction
Main body
Conclusion
References

Introduction

The public debt of the United States has been a topical issue in the country for a long time. Nowadays, the already staggering numbers continue to increase despite the fact that the public and the government have addressed the matter. Nevertheless, it is often said that the growing amount of debt has not reached its peak, and when it does, it will entail an unprecedented economic collapse. The purpose of this paper is to examine the issue, as well as several ways proposed to resolve it and mitigate the consequences.

Main body

While the problem in question has been receiving increasing attention from the media and the public in recent years, its origins date back to the countries foundation. Over the history of the United States, there have been few periods when the country’s national debt was not considerable compared to the economy (IOUSAtheMovie, 2008). As far as the present situation is concerned, the U. S. National debt exceeds twenty-seven trillion dollars (U.S. national debt, n.d.). Generally, the issue derives from a lack of balance between the country’s revenues and expenditures. According to Lee et al. (2013), the government’s revenues depend primarily on taxation and social security. Therefore, increasing spending without a corresponding revenue growth leads to a range of problems, including the budget deficit. In fact, the national debt poses a substantial issue due to the possibility of collapse and a lack of effort to cope with it.

As the numbers of the U.S. national debt grow, there is an increasing risk of catastrophic consequences for the country’s economy. Furthermore, it is expected that the issue will become even more severe in the coming years, as the generation of “baby boomers” nears retirement (IOUSAtheMovie, 2008). According to the U.S. national debt clock website (n.d.), the numbers have almost doubled since 2016, and, at current rates, will double once more by 2024. Accordingly, the issue is expected to persist in the near future with the possibility of growing more serious. As mentioned above, the federal government relies on taxation in terms of its revenue. Therefore, the pressure of the national debt may force the government to increase taxes, thus lowering the quality of citizen’s lives. In the worst scenario, the damage to the economy by the national debt growth will entail a global crisis comparable to the Great Depression.

In order to solve the problem or, at least, mitigate its consequences, the nation must take decisive steps in the right direction. Public Agenda (2012) proposes three possible methods, which can be implemented to cope with the budget deficit and national debt. The first approach consists of accurate long-term investments in the country’s infrastructure, science, education, and information technology. Accordingly, today’s expenditures are expected to result in significant profits later, thus reducing immediate spending in the long run. Secondly, another approach implies that the government should focus on Social Security and Medicare. Evidently, this method would translate into quicker results in terms of tax revenues, thus cutting the budget deficit.

On the other hand, this approach is expected to face the public’s opposition due to the inevitable tax load increase. The third way entails government size reduction, as well as spending decrease. Nevertheless, this concept may not be viable for the United States, as budget cuts in healthcare, education, and military forces would entail dire consequences for the country’s national defense and civic infrastructure. Overall, the first method seems to be the most efficient one, as it proposes a comprehensive approach consisting of striking the right balance between earning and spending while laying the foundation for the future.

Conclusion

In conclusion, the U.S. national debt remains a topical issue in the 21^st century, and risks related to it are increasing. Without proper measures to reduce the deficit, the debt may entail catastrophic consequences in terms of a global economic crisis. The correct approach to cope with the problem would consist of implementing a balanced long-term program to reduce immediate spending without putting additional tax load on the citizens.

References

IOUSAtheMovie. (2008). I.O.U.S.A.: Byte-sized – The 30 minute version[Video]. YouTube. Web.

Lee, R. D., Johnson, R. W., & Joyce, P. G. (2013). Public budgeting systems (9^th ed.). Jones & Bartlett Learning.

Public Agenda. (2012). A citizens’ solutions guide: The federal budget. Public Agenda.

U.S. national debt. (n.d.). U.S. national debt clock. 2020, Web.

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Reducing the United States Debt Crisis

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