The national debt of the United States has increased significantly in recent years. At some point, steps have to be taken to reduce the debt. So, in your opinion, what method(s) is best to reduce a nation's huge national debt? Why do you consider it the best method(s)?
Hello,
In the case of America, I personally believe that as a great nation, this country should abide with the message enacted by the proverb : Charity begins at home. Notably, international policing is a very costly undertaking. Sending troops and ammunition to various parts of the world require a huge amount of capital. I believe that the U.S.A. should take a fresh look at her domestic affairs which have doubly been confounded by devastating natural disasters. American people have a rich cultural heritage and they deserve to have high quality programs in all aspects of life.
Best regards,
R. Biria
Good answer, Reza. Your answer is very thought-provoking and inspiring. Thank you!
In lowering of America's debt the secretary of treasury, federal reserve chairman and other related functionaries must carefully study the situation in line with the country's visions and current realities. There is one way to reduce debt but the experts have to draw a fine line between fiscal and monetary policy. America's deficit has been exarcebated on several occasions by increased spending and lower earnings to GDP ratio. If America forsees that this deficit might widen further over the next couple of years and needs to be reduced to curb higher inflationary expectations then it stands to reason that they should increase taxes in certain areas and cut costs in certain areas this way the cost of borrowing would be reduced along with the attendant implications in widening deficit financing. However, if America is in slow mode (recession) and productivity, price of goods and services have been affected significantly then they may lower taxes and lower interest rates to stimulate the economy to growth. But in applying either of these there should be room for flexibility as these measures should not be applied with the same measures across the board given global competition in trade, technology and diverse economic interests in the world as we know it.
Maintaining interest rates at low levels is another way that governments seek to stimulate the economy, generate tax revenue, and, ultimately, reduce the national debt. Lower interest rates make it easier for individuals and businesses to borrow money.
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