What Is the Cause For the National Debt

istock_000005318004xsmallWhat is the cause for the national debt? The best answer to give to that question is the simplified one, the cause of the debt is due to the United States government spending more money than they are making in revenue. In other words, the government owes more than it makes. It is often wondered how that has happened, how can what is supposed to be the greatest country in the world be so far in debt? But a quick look through history may shed some light on the situation and we can in fact use our own household finances to explain how an entire country has fallen behind.

In many households today people are finding that they have more month left at the end of the money. That means that their bills add up to more than what their paychecks are and usually when that happens, when someone finds themselves unable to pay their debt, they look for a source from which to borrow. Sometimes a person is forced to take out multiple loans or to draw from one source to pay for another, much like the expression “robbing Peter to pay Paul.” That’s kind of the way the government got itself into such a debt.

This country has been in debt since it’s very inception and in fact, by 1791 was in the hole by $75 million dollars. That number saw a fairly steady incline but by the time the Civil War had passed, it had risen significantly to over $2.7 billion dollars. In fact, the only time the country was at a zero balance was on January 8 in 1835 under President Andrew Jackson. As time marched forward, it seemed that the debt increased drastically at the end of every single war. By the time each war had passed, the country was billions more in debt than it had been before they started and this has become a pattern throughout American history. While war is a major contributor of the rising debt, it certainly not the only one.

Some argue that the reason for the countries huge debt is due to poor investment decisions and even misallocation of funds. Others would argue that it’s due to Corporate America’s greed in using the government to fund private practices that are not necessarily in the interest of the people of America. One thing is for certain; the debt is so vast and is due to so many different sources that pinning down an exact cause could prove to be all but impossible. But the collective amount, if the right data has been gathered, shows that this country is literally trillions in debt and that number has only seemed to increase as the hours go by.

So, in answering the question what is the cause for the national debt, the only one right answer is simply that the country’s government gives out more money than it takes in. The debt itself has been the topic of political debate for hundreds of years but the solution has found a way to elude itself every time. Hopefully someday that question can be answered with a definitive solution to the problem instead of the finger pointing it has provoked.



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