Currently, the US federal government is running a large budget deficit. Now that the economy is recovering should the government prioritize a balanced balance? What would be the "best" way to balance the budget? Is the national debt an immediate concern?
Kaden
3/19/2012 10:15:04 pm
I believe that the government should at least try to reach a budget balance. I believe this because as we fall farther and farther into debt the harder it becomes to get out of the debt. I'm afraid if America falls to far into debt it will never be able to recover. I don't think the debt is an immediate concern its not very far from becoming an concern. Although this being said I don' t think it means to cut all sending and raise taxes significantly. If i was trying to balance the budget i would focus largerly on the foreign policy and affairs. For example ending all the wars we are in and go back to neutrality until the economy recovers. The American military spends over 600 billion dollars a year on theese wars, which continue to run up the dept. I would also increase taxes on the 5% to bring in more income. I dont believe the government should try to cut too much becuase it'll lead to more unemployment which will cost the government even more money due to automatic stablizers.
Justin Johnson
3/19/2012 10:24:04 pm
I think that the government should prioritize a balanced budget or at least make an effort to move towards one. The best way to do this is by conducting an expansionary monetary policy. In addition, the Fed would most likely execute this by using the tool of open market operations in which they would purchase bonds. As a result, this would shift the money supply to the right and lower interest rates. Furthermore, since the interest rates decreased, investment spending would increase which also causes a increase aggregate demand. In the short run, a increase in demand causes output, employment, and price level to rise. On the other hand, another but destructive way the government could move toward a surplus is by conducting a contactionary fiscal policy. Although it would help create a surplus, the policy would also decrease employment, output, and the price level. This approach is very unrealistic in the U.S. because everyone saw what happened to Greece when they conducted this policy.
Jake
3/19/2012 10:26:45 pm
With the US economy slowly going back to what it once was, any intervention might put back into a down turn with the uncertainty that we face. Once we have brought our economy back further where we want it, I think that we should balance the budget, but if we run a budget deficit we should have a budget surplus in the following year to make up for the deficit that we had in the previous year. To balance the budget though we are going to have to make cuts in a lot of places. Everyone is going to have to make some sacrifices so we can get our deficit in the right direction.
Lydia
3/20/2012 09:24:46 am
With the US making slow progress back to what it was. I am worried that further intervention may just provide uncertainty for the economy now. Even now one can't be entirely confident in our progress. I agree with Jake in that once our economy is more confidently returning to what it was then we should balance the budget. Cuts will have to be made and I think they need to be made right and in the right places so their isn't another crisis.
Pearl
3/20/2012 12:35:41 pm
The national debt is the all the annual deficits or one-year's shortfall. This shortfall must be made up by borrowing, but the Social Security Trust Fund and other government trust funds are not in debt. They have trillions in savings and the General Fund. As for the balancing of the budget, Congress is not likely to let the Bush tax cuts fully expire, so the Congressional Budget Office also prepares an "alternative fiscal scenario" that looks more like the path we expect them to take. It's the alternative scenario that has the horror-show deficits, but Congress doesn't have to act. It just has to do nothing. Or when it does do something, it has to pay for it.
Pearl
3/22/2012 09:39:51 am
Also, I agree with Kaden in that a good topic to concentrate on concerning the national debt would be foreign affairs being as $4.3T of the U.S. national debt, or 30%, is owed to foreigners. The fact that a good chunk of the debt is owed to foreigners is not nearly as much of a concern as the growth of the national debt in general though. Foreign debt includes foreigners temporarily saving their U.S. bucks, the same dollars sent to them for their products imported into our country. Some elect to temporarily save these dollars and earn interest by lending them back to the u.s. gov't by purchasing bonds
Caiti
3/22/2012 10:24:26 pm
I agree with Justin in that our government would benefit by prioritizing a balanced budget. However, I also agree with Kaden and Pearl that foreign affairs should be concentrated on a little more. The fact that the United States is over 14 trillion dollars in debt and nearly 700 billion of that is from wars really says something. It'd be beneficial for our country to cut defensive spending in order to put more focus on getting our economy into better shape. The national debt may not be an immediate concern, but it's quickly turning into one.
Nicolette
3/22/2012 10:27:44 pm
I think that the government should make an effort towards a balanced budget because otherwise we are just going to fall deeper and deeper into debt and will make for an even harder recovery. I think cutting programs would ensure the balancing of our budget. Defense and military spending is one area of government that can be cut back. It’s not neccessary for us to send billions of dollars to other countries in order for them to help us fight terrorism. Countries around the world have the same enemy and the U.S. can’t be the only country spending our resources to keep the rest of the world safe.Another effective way to balance the budget would be to increase the tax revenue, decrease spending or both.
Ashley
3/22/2012 10:28:41 pm
The US federal deficit is increasing more and more every year. It is currently $1325 billion, up $27 billion from last year, but they are slowly starting to progress back to lower numbers of the past. I think that they should continue to attempt to get to a balanced budget, but in order to do that we will have to cut spending and increase taxes, at least for a little while until the budget has been balanced. The US national debt is rising as well. It has reached around $15,000,000,000,000. This is definitely an immediate concern for our country. The average person is facing $50,000 worth of debt.
Abby Skoyen
3/23/2012 04:29:58 am
I believe that the government should somewhat prioritize a balanced budget because it's time we work our way out of our massive pile of debt. At the same time, i feel like cutting government spending and raising tax revenues is not a smart thing to do in our country right now. But if i had to pick a way, i would cut government spending because if you increase tax revenues, you'll upset the entire country. That's not good for anyone trying to attain or hold power in the white house because no one will vote for a president who wants to raise taxes. I think the national debt is a concern and we should start to hack away at it but with baby steps, not with a big drastic policy right now. Leave a Reply. | AuthorMrs. Scharfenberg teaches AP Microeconomics and AP Macroeconomics @ NRHS ArchivesMarch 2012 CategoriesUS Debt Clock |
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