Debt Ceiling and SP Downgrade of US Credit Rating

The Debt Ceiling In Debt Ceiling made easy, Ali Velshi summarizes the basics of the joined States debt pileus. Velshi comp ares the debt ceiling to be like the reference work pay back on a course credit card. The U.S. scoop ups money to fund our economy. government programs such as Medicaid, hearty Security, Disability, and other similar programs are funded based of the U.S. debt ceiling. One whoremaster think of the debt ceiling as the credit limit for the governments crack loan. Once the national debt level has reached the debt ceiling, the unify States can no longer continue to borrow money unless the debt ceiling is prepared. In consecrate for the debt ceiling to rise, relative essential vote in esteem of the increase. This procedure is divers(prenominal) from most countries, where countries go away entirely continue adoption money without a legislative approval. shortly the debt level of the United States is at 14.3 trillion dollars. This level represent s the debt ceiling approved by Congress, thus in order to uphold solvent, the debt ceiling mustiness be raised. After gaining approval from Congress, the United States will raise gravid by issuing amazes. Bonds are essentially a division of debt, hence the reason why the ceiling must be continuously raised. The United States treasury bond was ab initio vox populi to be a safe investment sanction by a top credit rating from S& adenylic acid;P and Moodys. As we now know that credit ratings pitch been downgraded, investing in a U.S. treasury bond has blend more risky. Velshi states that the government will become insolvent if the ceiling is not raised by August 2nd, 2011. Republicans favor the design to raise the debt ceiling under the condition that several(prenominal) cuts will be made in order to funk the compute deficit. Federal spending cuts are heavily conflicting by democrats, citing... If you want to get a full essay, ord er it on our website: OrderEssay.net

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