Economics Study Guide

This essay has a total of 1508 words and 6 pages.


The national debt of the United States is the total of all the obligations of the Treasury
to pay money to the federal government's creditors. By analogy, in judging whether a
national debt is large of small, one ought to compare it to the income (or product) of the
national economy because that income, through taxation or further borrowing, is the
ultimate source of interest and principal payments on the debt. The accompanying figure
presents the ratio of the national debt to the gross national product (GNP) of the United
States from 1791 to 1988. National debt is the total financial obligation of the federal
government. It aims to improve fiscal policy by establishing five principles of
responsible fiscal management and by strengthening the reporting requirements.

The concept that relates to National Debt is education. President Bush has expanded the
Pell Grant program through reforms to the student loan program. The expansion will provide
more assistance for low-income students to receive higher education as well as indirectly
lowering the national debt. The expansion of the Pell Grant program can prevent students
from taking out large amounts of loan, which will then lower the public's debt. The
President's Fiscal Year 2006 budget will increase the maximum Pell Grant award to $4,150
this year and $4,550 over five years to help more students. The President's budget request
will increase investments in Pell Grants by more than $15 billion over the next 10 years
to provide extra assistance for the Nation's low-income Pell Grant recipients.

Unlike the private debts, there are also promises to pay such benefits such as Social
Security, Retirement Pensions and the national debt. Social Security is a massive fund
that pays benefits to 30 million retirees as well as 15 million members of families where
a parent has died or become disabled due to injury. Social Security and retirement
pensions are in fact a large "obligation" to the federal government. There are actually a
large number of federal publications that report the measures of Social Security
obligations, but they do not report them as debts. This is because Social Security is not
considered a liability, it's because the government can increase or decrease these
benefits at any time. There are a few policy recommendations that may help Americans as
they reach the age of retirement. First of all, the percentage rate of retirement pensions
should be increased, with that being done the strain on social security may not be so
devastating, people will have more money from their pensions. Social Security should also
be funded from something more than just taxed salaries.

Bush's Energy Plan expanded research and development on transmission reliability and
superconductivity increasing the world's superconductivity. To improve the environment,
Bush's improvements will provide increased flexibility and ensure that air pollution will
not increase when power plants maintain and replace worn-out equipment. According to, President Bush has called on Congress to pass a comprehensive energy bill that
meets four major goals: promote conservation and efficiency, increase domestic production,
diversify the nation's energy supply, and modernize the nation's energy infrastructure.
Bush also proposed an act, "Clear Skies". This is an act that will cut pollution; it makes
a dramatic and steady decline in air faster, further, and a cheaper rate than do current
clean air programs.

Right-to-work laws are statutes enforced in several U.S. states, which prohibit several
types of deals between employers and unionized employees, such as union security. Open
shops are enforced, open shops is a place of employment at which one cannot be required to
join a labor union. President Bush plans to grow the economy by creating jobs. He believes
the economy needs flexibility and high skilled workforce Americans in order for this to go
as planned. Bush is looking for well-trained citizens; this is necessary to close the
skills gap in America. The National Debt of America has been very high for a long time.
America has been borrowing money from other countries leaving the United States in great
debt. Government spending and taxes is a big factor in our debts on this nation. Creating
jobs will pull our nation out of debt by collecting taxes from Americans payroll. George
W. Bush promised American that he would affirm the time-honored rights of individuals to
voluntarily participate in labor organization and to bargain collectively.

President Bush claims to be "committed to building an environment that encourages
innovation, lowers the cost of doing business, and promotes economic growth." The
President has a six-point plan that will first; allow families to plan for the future by
making tax relief permanent. Second, encourage investment and expansion by restraining
federal spending and reducing regulation. Third, make America less dependant on foreign
sources of energy through a comprehensive national energy policy. Fourth, expand trade and
levels the playing field to sell American goods and services across the globe. Fifth,
Continues for 3 more pages >>