U.S. Debt- Who will pay the price?
The Economic Policy Institute, on 9-14-05, released an updated issue of their weekly publication, Economic Snapshots, entitled, "Foreign Governments finance a growing share of U.S. trade deficit." The article addresses a growing concern, especially among the younger generation of working Americans, which is the outrageously large national debt. The article announced a terrifying statistic, claiming, "The U.S. debt increases by an average of 1.8 billion dollars a day." The United States acquires most of this money by borrowing from other countries such as China, who willingly seek the financial security that accompanies the U.S. dollar. Therefore, due to the eagerness of such foreign countries to loan the U.S. large sums of money, the question is not, - "How will the U.S. acquire such an enormous sum of money?"- but instead- "How will we pay back the interest on such an enormous sum of money when it comes due?” Will the next generation of Americans be able to thrive despite the burden of inheriting such an immense national debt? The decision makers in Washington, today, obviously think the cost of our present security and high quality of life are worth the risk. The only proposed solutions as to how to decrease the debt is either to lower the value of the U.S. dollar or to give up a substantial amount of government aid. Neither of these options is conducive to maintain the healthy and productive workforce that America depends on to maintain world power.
4 Comments:
At 1:34 PM, kipper said…
I think this is an excellent issue to address, because sooner or later the US will have to pay the countries back for money they borrowed. Obviously, we don't have a checking or savings account with enough money to payoff our trillion dollars of debt; the countries could demand their money at any time. This could even bring us to an extreme situation of war for money. Unless the US can figure a way to stop borrowing and start spending only within our means (very unlikely), then we as the younger generation are inevitably doomed!
At 9:17 PM, Lynn said…
I think this is an excellent point.
Our future is what is in trouble. But I also do not understand why we have to borrow so much money from other countries. The government gets plenty of money from us, the citizens. Where is all of our money going?
At 12:34 PM, skeeter said…
This is a topic that not many people (our generation) know about, but it is very important to think about and be concerned about. Like kipper said, the U.S. will have to pay back the money borrowed from other countries sooner or later, but how will they do that? The U.S. is not going to give up a lot of government aid, because then many countries around the world will want to loan the U.S. money. If all these other countries give the U.S. money in exchange for government aid, it will in the end cost the government more to give out aid than to actually pay back the debt. The only other way to pay back the debts is to actually pay it back in currency, and guess who will be hit with the taxes and bills passed by congress to get the money to pay these countries back, our generation. We probably will not see a major problem out of this for about another 10 years or so, but that will be about the time our generations financial problems really hit. It will be about the time that our generation settles down, gets married, and begins to think about or already have kids. Then we will have to pay our way, our kids way, and on top of that, the new outrageous tax to repay these countries we have borrowed money from. Just as lynn stated, we have plenty of money within the U.S., were did it all go, and why are we not using it properly? To much of our tax dollars are being spent on things that are a waste of the tax payers money, and a waste of the money itself. If the government would get its prioritites straight about spending our tax dollars, we would not have to borrow money from other countries.
At 3:18 PM, symonekayla said…
This is a very interesting article that is the topic among many Americans today. I think(know) that we(United States) are living outside of our means. I would also like to know how we will pay back such an enormous amount of money. Just like Skeeter and Skipper said the young generation and many other tax payers are going to have a hard time a few years from now.
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