Question

In April 2020, the U.S. national debts has exceeded $23.8 Trillion. It is rising much faster than the U.S. economy, and it will soar to more than $34 trillion in 2029, according to the budget office.

Why does the U.S. national debt continue to rise?

What is the impacts of a huge and growing U.S. national debt on the U.S. economy?

How to reduce the U.S. national debt?

Answer 1

We discuss all question one by one.

So the first one is why US national debt continue to rise?

The US national debt is continue to rise whether we talk about government debt, household debt or business debt. The reason behind that US current account deficit and income inquality. The current account deficit was $491 billion in 2018. It means US people import more than export. And the income inequality reached its highest level in 50 years.

Impacts of a huge and growing US national debt on US economy.

In US the national debt causes high interest rate, cut in spending, less ablity to start new project and face new challenges. The national debt also causes unemployment because government and private expenditure reduces due to high payment of interest for loans.

How to reduce the US national debt.

The US government redcue either raises taxes or cut spendings, but it causes negative affect on the economic growth of the US. So at that time the US government cut spendings on those areas which do not create many jobs. Similarly increase in tax rate discourage corporate, common people. So government put tax on those commodities which are luxuries in nature which use by small section of rich people but not the common goods and services. So it helps to the corporate and common people to enjoy less interest rate and helps in the growth of the economy.