High Budget Deficits

High Budget Deficits

Robert Owens

ECO203

Instructor: Phelicia Price

July 9, 2012

High Budget Deficits

When it comes to the economy there are many things that affect how well or how poor it is doing. For the most part, many of us do not really take the time to understand why the economy is in the shape that it is in. There are reasons why layoffs occur. There are reasons why unemployment is continues to climb. There are reasons for high interest rates and increases in taxes. This paper will discuss one of the main reasons why these things occur. The high budget deficit is affecting the economy and the future economy.

When it comes to the future of the economy, today’s high budget deficit has a huge effect on the growth rate of economy in the future. The economy does not become what it is over night. It is developed over time through many different reasons. Since it takes time to develop the economy over time it also takes just as long if not longer to fix it. Everything we, as a country, do right now will determine gas prices in ten years, college tuition for our children, unemployment rates, health care benefits, etc. The economy is not in its best shape right now and if we do not change certain things in both our individual selves and as a country it will not only remain bad but it will also get worse. Economists realize this and that is why they are concerned about the future.

The reasons for the high budget deficit vary from things such as lowering taxes, increased defense spending, creating more job-training programs, etc. When it comes to figuring out why the budget deficit is high the reasons are very important. In many cases the government chooses to invest in areas that do not bring that much return. If the budget deficit has been created to invest in something that will be productive to the economy then it is a good thing because it will show a good return. Another important reason why the reason(s) matter is for tracking...