How does the national debt affect the individual?
The U.S. national debt is the amount of money owed by the United States federal government. This does not include the money owed by states, corporations, or individuals. The national debt is over 8.1 trillion dollars. That puts each citizens share of that debt to over $27,000. The National Debt has continued to increase an average of $2.28 billion per day since September 30, 2005. U.S. Public debt is more than ten times the amount of United States currency in circulation as of 2005, estimated to be $730 billion
So, how does this affect us as individuals?
Approximately 18 cents out of every dollar of total tax revenue collected is immediately used merely to pay the burgeoning interest on the Federal debt. Thus, absolutely no governmental services or benefits are delivered in return for 18 percent (nearly 1 out of every 5 dollars) of our total Federal tax bill.
The interest we all must pay on the national debt represents a “debt tax” that can never be repealed as long as the debt remains at its current levels. The debt tax will consume larger portions of our money as government spending continues to increase.
These are substantial funds that could most prudently be re-invested in the growth of our own businesses, but must be shoveled out instead simply to service the interest payments to the world of strangers who hold these obligations of the Treasury of the United States.
While some of the recipients of these interest payments may recycle these funds into the purchase of domestic goods and services, much of the Federal debt is held by foreigners.
The national debt drains substantial funds out of the business that could otherwise be invested in job creation and entrepreneurial expansion. It also drains substantial funds out of consumers’ pockets that could otherwise be available for the acquisition of goods and services. And this burden inevitably impedes the growth and prosperity of the economy.
What are the presidentials’views of the national debt and their plan to reduce it. I haven’t heard that talked about
While McCain has historically favored deficit reduction over tax cuts, he has pledged not to rescind recent tax cuts in combination with reduced spending. McCain believes that lower taxes will stimulate the economy, and that the current deficit owes more to overspending than to tax cuts. McCain plans to balance the budget by the end of his first term.According to the Tax Policy Center, McCain’s tax plans (by extending the Bush tax cuts and cutting corporate tax rates from 35% to 25% to increase investment, among other measures), would increase the national debt by nearly $5 trillion over 10 years, a nearly 50% increase.
Obama advocates responding to the “precarious budget situation” by eliminating “tax credits that have outlived their usefulness”, closing corporate tax loopholes, and restoring the PAYGO policy that prohibits increases in federal spending without a way to compensate for the lost revenue.Obama proposes extending the Bush tax cuts for low- and middle-income families, while letting taxes go back up for individuals earning over $200,000 or couples earning over $250,000. According to the Tax Policy Center this plan would increase the national debt by $3.5 trillion over 10 years, a nearly 35% increase.