Could someone explain what the national debt actually means?
1) If we're owing another country trillions of dollars, doesn't that mean we're ahead by the amount they lent us?. And, we're collecting interest on that amount? And, they're in the red on that amount?
2) Even if we pay the minimum, we're still collecting interest on the rest?
None of this may be true, so maybe someone can enlighten me.
Answer:
National debt is the total amount of government borrowings and this would include the principal and the interest. It is thus the outstanding financial obligation of the federal government. According to the website of CNN, in 1997 "the amount of money the U.S. government owes its creditors stands at roughly $5 trillion. Each year that the federal government spends more than it takes in revenues, that amount (the deficit) is added to the federal debt. To many, the main problem with deficit spending isn't the borrowing per se, but the debt the government accumulates. As the debt rises, the government spends an increasing amount simply to pay the interest on the debt. Some scholars say the high debt and deficit raise interest rates."
The vast majority of the national debt is actually owed to our own citizens. It would seem like that doesn't really count, but you feel it's impact at tax time. A sizable portion (I think around 20-25%) of your federal tax dollars go to paying the interest on those long-term loans, t-bills, etc. If we weren't living on defecit spending, your taxes could conceivably be a lot lower.
That is the amount the country owes in total. after paying what debts were settled.
look at it as if the USA was a company; after all debts were paid on or off the balance is the national debt.
When politicians (of both parties) talk about the debt, they don't like talking about $8 trillion, so they add up all the funds, as shown above, and talk about the "debt held by the public." They call this the "national debt," and they call its yearly increase the "deficit." (zfacts.com/p/461.html )
here ar ea coupla of sites pretaining to the national debt.
www.house.gov/istook/debt
See the debt increasing in real time.
Category: U.S. Government Budget > National Debt Clocks
www.toptips.com/debtclock.html -
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