STANDARD:
E.4.5 Define budget debt and budget deficit and distinguish between the two. Explain the effects of both on the economy. (E)
GE.7.4 Explain how the use of fiscal policy affects budget deficits or surpluses and the national debt.
A
B
C
D
E
F
G
H
I
J
L
M
N
O
P
R
S
T
U
W
Contains
A
The ____ ____ has the largest debt in the world.
Contains
B
U.S. has a ____ ____ , which is a cap on how much debt the Treasury can issue. The U.S. will never be able to borrow more than the [same] so debt can never get out of control. Actually, no, because this does not address spending.
Contains
C
Also, when researching debt, we look at debt as a ____ of GDP. If an adult owes $200 bucks, and a 5 year old owes $100, which will have a harder time paying it off? The 5 year old. Even though the adult debt is larger, they have a job, more income.
Starts with
D
If the U.S. has programs that cost more money that is collected through taxation, this is budget deficit. Now the U.S. must borrow money to pay for its budget deficit, which is called ____ .
Contains
E
Right now healthcare spending is driving debt higher, but if a massive ____ kills off half the world, those healthcare costs are gonna fall. Video 2016 → COVID 2020
Starts with
F
Borrowing to pay for future debt is a problem, since there is a ____ ____ of money that savers can lend, & most of it is borrowed by the private sector: loans for cars, factories, computers. The government borrows from the same pool of savings.
Contains
G
First off, deficit and debt are not the same thing. A ____ ____ is when the government spends more than it brings in tax revenue in a given year. Then it has to borrow money to cover that year's shortfall.
Starts with
H
Borrowing to pay for future debt is a problem because our debt might increase to the point that other countries are afraid they won't get their money back. They can stop loaning, or they can loan at ____ ____ rates, making it hard to pay back.
Starts with
I
When we study the history of U.S. debt, we need to adjust for _____ . The money we have today does not share the same value as the money from the past. We use the market basket to do this.
Starts with
J
U.S. has a higher debt-to-GDP than other countries. Some are in crisis like Greece & Italy, but others are stable like ____ and ____ .
Starts with
L
In order for the U.S. to borrow more money and pay for future debt, it needs _____ . These are people who put their money in banks instead of buying fun stuff and going on vacation. These people are limited.
Contains
M
Experts are not worried about past debt. They are more concerned about future debt. Or what politicians will do to create huge deficits in ____ ____ .
Contains
N
Deficits are the difference between federal spending and tax revenue. And since the problem isn't a drop in tax revenue, economists are worried about is _____ .
Contains
O
If you believe high debt is killing our way of life in the U.S., this is a reflection of your ____ point of view. Because cutting debt will mean cutting government programs.
Contains
P
Debt comes from deficits & deficits come from spending more than revenue. The debt ceiling does nothing to ____ ____ or raise revenue. Trying to cut debt without raising revenue or [same] is like trying to lose weight without diet or exercise.
Contains
R
A lot of the budget money spent on healthcare programs goes to retired people on ____ . And those are the programs that are expected to grow as Baby Boomers retire and live longer. Defense and other programs are actually shrinking.
Starts with
S
25% of the U.S. budget is spent on ____ ____ , and another 25% on medicare & medicaid. So republicans and democrats are wrong when they accuse welfare and military spending.
Contains
T
A country's capacity to ____ debt increases annually, just as the country's gross domestic product increases. As we make more money, we are better able to manage more debt. This is why debt is expressed as a percentage of GDP.
Contains
U
Borrowing to pay for future debt is a problem because the debt might reach a size where the country cannot pay it back. This is _____ . Lenders lose billions. The country might just disappear, like the Soviet Union.
Contains
W
We know that investors in other countries trust the U.S., and believe we can pay back our debts, because they have given us ____ ____ on our loans. This is a positive sign.
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