The Impact of the Deficit Surplus and Debt of the United...

Discuss how and why the U.S.s deficit, surplus and debt have an effect on the following: Tax payers Future Social Security and Medicare users Unemployed individuals University of Phoenix student The United States financial reputation on an international level A domestic automotive manufacturing (exporter) An Italian clothing company (importer) GDP Trade deficit refers to the situation when the value of imports exceeds the value of exports. This is synonymous to surplus when the nation has a surplus of imported goods. The whole affects the income of the USA during that given period hence affecting the national debt. This, in turn, has a dribbling down effect on all related factors as explained in the following essay. The best situation for the USA is when its exports exceed its imports. In this scenario, the USA is kept busy producing goods that other countries are interested in and its GDP (or income) consequently rises. When imports, however, are greater than exports, the United States is said to have a balance of trade deficit and has surplus goods. In this situation, the USA is buying products (thereby giving of its money to another country) but not earning anything in return (since its level of exports is insignificant). When import exceeds that of export, the country may find itself in grave economic danger since the following three factors are affected: the output and income in the economy; the level of HYPERLINKShow MoreRelatedFiscal Policy Paper Eco3721409 Words   |  6 PagesThe United States deficit, surplus, and debt will always have an impact on taxpayers. In the state of high deficit the government seeks ways to cut and save money for debt payment. The government does this by pull ing funding from programs that have little government impact. Increasing taxes also supplies the government with extra income. 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