1. What is Happening to The US Fiscal Deficit and National Debt？
Group 2

2. Outline
What is happening？
Why it happened？
What’s the influence？

3. Current Status White house predict on 7/15
Current fiscal budget deficit 600 billion (increase 162 billion from last year)
National debt increase from 10.6 trillion to 19.3 trillion (2009 to 2016)

6. exceeding the historical peak after World War II
rise to 141% in 2046
risen to 75% in the wake of a financial crisis and a recession.
exceeding the historical peak
after World War II
39% at the end of fiscal year 2008

7. Why it happened？ Mailnly due to
821 billion reovery act of 2009
Affordable care act
Other measures for American business
Spending (increase rate larger than revenue)
Social Security(aging of the U.S. population, subsidies for health insurance)
Major Health Care Programs (aging of the U.S. population, subsidies for health insurance)
Other Noninterest Spending
Net Interest (interest rates are expected to be higher；increase in deficits: The larger they are, the more the government will need to borrow.)
Revenue
Individual Income Taxes
Corporate Income Taxes
Payroll Taxes
Other Revenue Sources

8. What’s the influence？ More debt more interest paid
Creditors worry about the solvency of high debt government
Debt decrease tax revenue in the long run
Exchange rate upset global financial market/trade
US society securities fund, banks, insurance companies are the biggest owner of treasury bonds.