Carter Clarkson Clarkson 1
Honors English 10
Oct 20 2016
Should a conflict be resolved after a crisis, or before to solve it? The United States is facing many horrible conflicts with the rise of terrorism, foreign threats, disease, pollution, and even more. With all of these arising contentions the United States national debt can be overlooked, however, as the national debt increases devastatingly higher every single second, the penalties grow impossibly greater. The immense borrowing and spending of the government has and will continue to create higher federal interest payments, fiscal crisis, and a decreased ability to solve the problem. The United State’s government can no longer ignore the boiling issue of the national debt because, if continued, the consequences will be felt heavily in the United States and also around the World.
The rising national debt is contributing to higher interest payments, which leads to large tax hikes and spending cuts. As the national debt continues to skyrocket, the rate charged to pay off the federal funds of the debt will increase, as more and more money is needed. To pay off these increasing interest payments, the businesses need to be taxed more, which many Americans cannot afford. High taxation can also result in a loss of jobs, higher product prices, and lower wages causing community and economic downfall. “As interest takes up more of the budget, we will have less available to spend on programs.” (crfb.org) Another major affect of higher interest payments is that the Government will have to create spending cuts on Government funded organizations. In a 2011 dubious distinction, 44.7 percent of the population paid no federal income taxes, being dependent on Government funded organizations. This is a major difficulty because many Americans are dependent on government organizations for housing, food, or even Medicare. However, as a counterargument, Government funded organizations are contributors to tax hikes because many Americans are dependent on these organizations to pay their taxes. With this significant portion of the population not paying their taxes, the lost money has to be accounted for in tax hikes for actual taxpayers. These effects of higher tax rates could be stopped if more of the American population had a job with a sustainable wage. There are too many government-funded organizations that too many Americans have become dependent on.
Along with higher interest rates, the national debt and probability of fiscal crises are directionally proportional as when the debt increases, there is also an increased probability of major fiscal crises. A fiscal crisis comes to play when there is an inability from the state to connect a deficit between its expenditures and its tax revenues. A financial and economical crisis can come into play when “Government debt levels contribute to a loss of market confidence in a national economy. Reflected in turn instability in currency and financial markets and stagnation in domestic output.” (Lee) Their needs to be confidence in the market for efficient commerce because investing can be a very risky business. If there is faith in a stock, consumers can invest confidently knowing they can make money, however, if there is no confidence and investors believe their stock will lose value, they will rush to sell it. This shaken confidence can create fiscal crises, as there is no money earned.
Because the National Debt continues to grow, there is a decreasing ability to respond to problems. When under conflicting situations, the United States can borrow money to help contribute to fix the problem. This is relatively easy to incorporate to with a small national debt but with a large national debt, there is a reduced ability to respond to the situation. “Future recessions and financial crises could have a larger negative effects on the economy and the people’s well-being. Moreover, the reduced financial flexibility and increased dependence on foreign investors that accompany high and rising debt could weaken U.S. leadership in the international area.” (crfb.org) With the United States’ national debt being 19,700,000,000,000, the country has very little flexibility to responding to a crisis as it is building on the negative effects more and more. The national debt cannot be ignored any longer because it is out of control and an immature act on behalf of the nation. Our Government must have a clear purpose and not be invasive in order for the United States to become aware of it’s full potential.
This massive issue of the heaping national debt cannot be overlooked because the consequences will continue to develop into a major downfall. The National debt has and will continue to create higher federal interest payments resulting in higher taxes and spending cuts, continuously more negatively impacting fiscal crises, and also a reduced ability to respond to these conflicts. The United States cannot allow this debt to build any higher. Mr./Mrs. President please do not allow this situation to be ignored any longer but repair this corrupt act to secure the safety, stability, and greatness of the Unites States of America.
By 2039, the Deficit Would Equal 6½ Percent of GDP, Larger than in Any Year between 1947 and 2008, and Federal Debt Held by the Public Would Reach 106 Percent of GDP, More than in Any Year except 1946-even without Factoring in the Economic Effects of Grow. "The 2014 Long-Term Budget Outlook." Congressional Budget Office. N.p., 27 Jan. 2016. Web. 20 Oct. 2016.
By Not Making Responsible Debt Choices, We Are Placing Higher Debt Burdens on Our Children and Threatening Their Standard of Living and Retirement. "Q&A: Everything You Need to Know About the National Debt - Fix The Debt." Q&A: Everything You Need to Know About the National Debt - Fix The Debt. © 2016 Fix the Debt Coalition, Inc., n.d. Web. 20 Oct. 2016.
"CBO: Consequences of a Growing National Debt." Committee for a Responsible Federal Budget. N.p., 09 Aug. 2016. Web. 20 Oct. 2016.
"Congressman Todd Rokita." Spending Cuts and Debt. Rokita, n.d. Web. 20 Oct. 2016.
Lee, Simon. "Fiscal Crisis." Encyclopedia Britannica Online. Encyclopedia Britannica, n.d. Web. 20 Oct. 2016.
"TOP TEN EFFECTS OF." 10 EFFECTS OF HIGH TAXES. N.p., n.d. Web. 20 Oct. 2016.