Essay by:
Lisa Harris
Emporia State University

            The U.S. today spends way more money than needed. People are spending more and more money on wants instead of needs! Individuals just want more these days. Part of the constant growing debt is from people spending all of this money, even when they don’t have it. Individuals are taking out loans more often because it is so easy. They then have trouble paying off those loans. The banks that give out these loans don’t worry about it, until now, because the government has to bail them out. Companies are spending more and not making as much, therefore they are also going into debt, and when companies and individuals go into debt they have to ask the banks for help, but if the banks are having trouble, then they are not able to help out the businesses.

            Something that was a huge impact on debt was sub-prime loans. When banks would give out loans with really low interest rates, individuals thought this was good, but once the initial low interest rate period was over, interest rates rose. Once this occurred, individuals couldn’t afford their loan payments anymore and therefore started going into debt. As well as when banks would give out loans and then sell the rights to that loan to another bank, once the second bank got the loan they could do with it as they pleased. So if they decided to raise the interest rate the individual who took out the loan would be in trouble and not be able to pay the payments on that loan.

            Our current national debt comes to approximately 14 trillion dollars. This has about doubled since the year 2000. It seems like the cost of everything has increased. The Median household income has risen 17 percent, from 42,000 dollars in 2000, to 49,000 dollars in 2008 (Quinn). The consumer price index has risen from 168.8 in 2000 to 220.0 in 2008; this comes to a 30 percent increase (Quinn). Consumer credit went from 1.54 trillion dollars in 2000, to 2.59 trillion dollars in 2008, this is a 68 percent increase (Quinn). The average home price has increased by 49 percent, from 139,000 dollars in 2000, to 206,500 dollars in 2008 (Quinn). These are some drastic increases in prices that affect everyone.

            These days, people have to spend more money on their everyday costs of living. The price of everything seems to have risen. Individual’s everyday costs have increased since 2000. Electricity cost has risen 25 percent, it was .084 dollars per kWh in 2000, and is now .105 dollars per kWh (Quinn).  Milk was 2.78 dollars per gallon in 2000, and is now 3.87 dollars per gallon in 2008. This is a 37 percent increase (Quinn). Bread 41 percent, eggs have risen an outrageous 122 percent, orange juice 40 percent, and ground beef 57 percent (Quinn). These are some of the items that people use everyday that have gone up dramatically!

            The war in Iraq has also changed everything dramatically! The government has spent so much money on that war, and it’s still not over! We have lost so many soldiers in this war, which when a soldier is injured or killed, that is another increase in cost, from hospital costs, to costs to send out a new soldier in their place! As of 2008 to date, we have spent approximately 600 billion dollars on this war! We should not need to spend near that much!

            Since 1975 our federal debt has risen from 542 billion dollars to more than 9 trillion dollars (Quinn). Showing debt as a percentage of GDP, it is now at 60 percent when it was at 35 % (Quinn). Our tax dollars are going into things that we don’t have hardly any control over and we don’t see changing. Approximately 27 percent goes into the military whether we support the war or not (Quinn). 21 percent into health care (Quinn). 19 percent goes just into paying off the debt (Quinn). 12 percent into other stuff (Quinn). 6 percent goes into income security (Quinn). 5 percent, into education which I personally think this should be a lot more (Quinn). 3 percent into Veterans benefits (Quinn). 3 percent goes into nutrition (Quinn). 2 percent goes into housing (Quinn). 2 percent has gone into the environment (Quinn). And only 0.3 percent into job training (Quinn). So as you can see, instead of our tax dollars going towards things that affect us from housing to education. The government is spending it on things that they need it for.
            All of these things are some causes of why our national debt is so bad. Our inflation is sky high now because of this and we are on the edge of a recession, if not already in one. Individuals, as well as businesses need to start cutting back on everything they are spending and stick to the essential needs.

            

Works Cited

Quinn, James. America’s Fiscal Crisis: Tough Decisions Needed Now. Seeking Alpha. August 17, 2008. http://seekingalpha.com/article/91274-america-s-fiscal-crisis-tough-decisions-needed-now.




Re: Causes of our National Debt

Great job! You included great points as well as statistics which helped really show the crisis that our nation is in. The key ticket truly is that we as people and as a nation need to cut back on what we spend, buy, use and receive because without slowing down we will not change the state we are in.


Re: Causes of our National Debt

Lisa,

Great job on your essay, i really enjoyed your thoughts on national debt. I also thought that you made very valid points about how Americans spend their money and the problems of people spending on their wants instead of their needs. Your statistics were also great.

Good Job,
Whitney Franklin


Re: Causes of our National Debt

Nice job on your essay! I really liked the points you made. Your essay included a lot of good and interesting facts.

-Morgan Pearson


Re: Causes of our National Debt

Lisa,
Excellent paper. I agree with your statement that most Americans are living well beyond their means and as a result has cause serious financial problems. I really liked the fact that you wrote your paper from a more personal perspective.
-Brandon Rich


Re: Causes of our National Debt

I really enjoyed reading your essay. Very interesting points. I agree americans buy for wants and not needs. Hopefully this will change in the future. Great job.

Kelsey C.


Re: Causes of our National Debt

Lisa,

You essay was great! I liked how you pointed out in the very beginning that people are spending even more money than in the past on wants instead of needs and now it has caught up to them! You talked about loans a lot and I really enjoyed that because I need to be more knowledgable about them as I am getting older as do I think other people! It is a big part of life especially today. Your statistics were great. It shows people exactly how much times have changed with our debt over the years and how it has continued to increase. It will only get worse if something does not change! If people did not know how much more debt we are in today than in the past and how much it has increased, they should read your essay! It is crazy. You did a great job!

Ashley Goodloe


Re: Causes of our National Debt

Good essay. You clearly addressed a lot of the current problems we as American's are facing right now with our economy. My only request would be for you to have listed some possible solutions for the problems you presented to give the reader/audience some hope that there is an actual solution and we're not just up sh*t creek with out a paddle.


Re: Causes of our National Debt

Great Job, You had some really good points, and the statistics help to drive home your point.

Beth Meigs


Re: Causes of our National Debt

Overall i think this was a great paper and it had a lot of good points and you were able to point some personal thoughts into this paper and you also had some great points. It was really easy to read becuase just after the first sentence i was hooked, and also the fact that you puts some facts into this paper made it even better. Good job.
Emma Sorensen


Re: Causes of our National Debt

I guess the government and the big companies aren't the only ones who need to watch there spending??? When the amount on the paycheck goes, it becomes harder to not purchase the latest electronics or what ever the newest product is!!!

Whitney Cates


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