Austerity measures help the U.S. reduce its deficit, but it remains high
A lot needs to be done in the United States about its rising debt. Americans have tried to help in the reduction of the budget deficit, but it has not been enough. The government just keeps expanding the debt ceiling thinking that it could go on until infinity, but it is a known fact that someday it has to end.
The public started demanding answers and hold the government accountable for its expending. This is for real, for the first time in five years that the federal deficit has been lower than one trillion dollars. But it is only a first glance success, said experts of the news publication department at Masterforex-V World Academy. You just think about these figures and say, one trillion dollars? The government spends more than it earns. Let us take your family budget, for example you have earned 1,000 units of money per month, and spent 1,200 units; 200 units are missing. Obviously, you borrowed them from someone, maybe the bank, or friends, or relatives. But sooner or later everything has to be repaid, written off, or offered something else in exchange.
The job is not done yet, they still have a lot of obstacles to overcome. If the previous year the budget deficit exceeded one trillion dollars, the new estimate shows the excess of expenditure over income at 680 billion dollars. This is significantly better than even the hawkish earlier forecast of U.S. authorities. Earlier, it was predicted that the budget deficit will be reduced by about 100 to 150 billion dollars, but it turned out be reduced by more than 400 billion.
The administration of the current president, Obama, says that things are getting better. It should be noted that over the years of the first black president in the history of the United States, the budget deficit was reduced by half, which is the best since the forties of last century.
Even the treasury secretary has had to interfere on behalf of Americans and urged congress to be more proactive in helping reduce the budget deficit. We should remember that between Republicans and Democrats there are significant differences on the budget issue, which recently again led the United States to the threat of a technical default. For some time, the work of many state agencies as well as their financing was paralyzed. Hundreds of thousands of state employees have been sent on leave.
But the debt just keeps rising. At the end of 2011 it exceeded $ 15 trillion, and two years later was increased by $ 2 trillion, exceeding the threshold of 100 percent of GDP. The worse, as a percentage of GDP, was only towards the end of Second World War which was over 121 percent. After the war, the U.S. economy began to grow rapidly, and for eighty years the national debt was reduced to 35 percent of GDP, and then it began to increase again.
The almost default that we saw this year is not something, almost the same scenario played out last year too. But the problem was solved very simply and the debt ceiling was raised. In less than a year, and this level has fallen. It was necessary to raise the bar once again allowed the national debt, but the Republicans and the Democrats took a principled position, not wanting to compromise with each other. As a result of the heated debate and recrimination, congressmen and senators reached a temporary agreement, but only temporarily. The final version of the budget for next year, as we have noted, has not been adopted.
And to make things worse, the U.S. debt is in danger of being downgraded by the credit agencies. If the credit rating of the U.S. is downgraded, then the new loans of the U.S. government will have a higher interest rate. The news department of Masterforex-V Academy http://www.masterforex-v.com points out that the largest international creditors of the U.S. are China and Japan. Each of these countries has a great amount of U.S. Treasury securities.
The public started demanding answers and hold the government accountable for its expending. This is for real, for the first time in five years that the federal deficit has been lower than one trillion dollars. But it is only a first glance success, said experts of the news publication department at Masterforex-V World Academy. You just think about these figures and say, one trillion dollars? The government spends more than it earns. Let us take your family budget, for example you have earned 1,000 units of money per month, and spent 1,200 units; 200 units are missing. Obviously, you borrowed them from someone, maybe the bank, or friends, or relatives. But sooner or later everything has to be repaid, written off, or offered something else in exchange.
The job is not done yet, they still have a lot of obstacles to overcome. If the previous year the budget deficit exceeded one trillion dollars, the new estimate shows the excess of expenditure over income at 680 billion dollars. This is significantly better than even the hawkish earlier forecast of U.S. authorities. Earlier, it was predicted that the budget deficit will be reduced by about 100 to 150 billion dollars, but it turned out be reduced by more than 400 billion.
The administration of the current president, Obama, says that things are getting better. It should be noted that over the years of the first black president in the history of the United States, the budget deficit was reduced by half, which is the best since the forties of last century.
Even the treasury secretary has had to interfere on behalf of Americans and urged congress to be more proactive in helping reduce the budget deficit. We should remember that between Republicans and Democrats there are significant differences on the budget issue, which recently again led the United States to the threat of a technical default. For some time, the work of many state agencies as well as their financing was paralyzed. Hundreds of thousands of state employees have been sent on leave.
But the debt just keeps rising. At the end of 2011 it exceeded $ 15 trillion, and two years later was increased by $ 2 trillion, exceeding the threshold of 100 percent of GDP. The worse, as a percentage of GDP, was only towards the end of Second World War which was over 121 percent. After the war, the U.S. economy began to grow rapidly, and for eighty years the national debt was reduced to 35 percent of GDP, and then it began to increase again.
The almost default that we saw this year is not something, almost the same scenario played out last year too. But the problem was solved very simply and the debt ceiling was raised. In less than a year, and this level has fallen. It was necessary to raise the bar once again allowed the national debt, but the Republicans and the Democrats took a principled position, not wanting to compromise with each other. As a result of the heated debate and recrimination, congressmen and senators reached a temporary agreement, but only temporarily. The final version of the budget for next year, as we have noted, has not been adopted.
And to make things worse, the U.S. debt is in danger of being downgraded by the credit agencies. If the credit rating of the U.S. is downgraded, then the new loans of the U.S. government will have a higher interest rate. The news department of Masterforex-V Academy http://www.masterforex-v.com points out that the largest international creditors of the U.S. are China and Japan. Each of these countries has a great amount of U.S. Treasury securities.