What is US the national debt? Can someone please explain it in lay man's terms?
Answer:
National debt means how much money the U.S. Government has spent over the authorized budget.
A government budget is no different than a family budget.
They know approximately how much money is coming in and try to stay withen the budget authorized by congress....But the big spenders in gvt. can't do it, so they get congress to raise the debt limit every so often...and add more debt all the time.
This is the National debt.
Who do, We the People, owe the debt to?
We owe it to the Federal Reserve banking system which has loaned our government the money they asked for.
******************************...
You pretty much got it. Just for more info. China is buying a lot of our debt. They have a surplus of money so they are investing it in the US. This country isn't very good with money is it.
Idealistically, congress is suppose to tax us and put all the tax money into a high interest bearing account. Then, they are suppose to skim off the interest and give us back 100% of what we pay into the system annually, however, this system has never worked that way. So, instead, they set an amount of money (x) to represent how much you have to pay in taxes per dollars you earn. So, now you only get money back if you over pay. And again, they are only suppose to spend exactly what they take in, and nothing more..
However, congress gets a little greedy, and goes a little nuts with the check book, and writes checks they cannot honor-so we have to borrow money from other sources (i.e. Social Security, China, ect.,.) thus causing the national debt. Printing more of our own money to pay for this debt would not only devalue our dollar but cause inflation (which is the same as devalue).
One thing to know and understand, no matter how high the national debt is, as long as there is income-we're okay, unless all the countries we owe money to comes to collect (which they won't because we're link into their economy) then we have little of nothing to worry about, with the execption of inflation.
The National Debt is money the government owes for expanding itself beyond its financial means. Since our national debt is almost one quarter of our entire budget the interest we are paying is 1.1 billion each year. We are paying nothing on the principle. It will not be long before the America Fiat dollar collapses as all paper money systems have. Our dollar is worth 4 cents now. These federal reserve notes are supposed to represent actual gold or silver to be paid to us the people on demand as the constitution states. If you went to the federal reserve bank and asked you would be rejected but if they honored their commitment to the note you would get 40 dollars for a thousand dollar bill. Thats the return to us for the federal reserve printing money out of thin air with no backing. They do not have the gold to back their paper money. Which is illegal and immoral. A good place to start to digest this information would be freedom to fascism. See link
congress firsts effects an annual budget, if the government spends more than the budget it now becomes a budget deficit.
since the gov't spent more than it earns and in a particular year incurred a deficit, he thens issues sovereign bonds,which is sold to other countries, or the banking system, this then forms part of your national debt. that is what china was buying.
National debt, is simply what a nation owes from its creditors.
The answers post by the user, for information only, FunQA.com does not guarantee the right.
More Questions and Answers: