pls105, question 1

pls105, question 1 - :PLS 105 1 The federal deficit affects...

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:PLS 105 1. The federal deficit affects the federal budget in a variety of ways. Deficit spending is spending more than is collected in revenues. Sometimes a deficit is planned by the government, or sometimes it occurs because factors in the economy have reduced the amount of revenues or increased the amount of expenditures. To hold back deficit spending the United States has made a debt limit set by our government. This limit is set to keep our country’s debt under control. The more our economy grows the lower our debt limit can be. When our country’s economy suffers, such as times of war, the debt limit must be raised. A good example of an ideal time was during the Great Depression and WWII. A main problem with our debt limit is that it is ever increasing. From 1997 to 2004 our national debt limit has raised over two trillion dollars. Our treasury department demands that we need our bar raised again. If our debt keeps raising this bar and becoming more in debt our country could be bankrupt in 50 years.
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