Kirichenko Elina
Growing budget deficit and national debt: estimates, problems, risks
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ISSN 2074-6040

DOI 10.33920/vne-04-2111-01

The article analyzes the structure of the US federal budget, the main sources of revenues, expenditures (annually revised discretionary spendings, mandatory financing of the main social and a number of critical areas of government activity, interest debt payments), factors affecting their dynamics. A special place is occupied by the analysis of the national (sovereign) debt of the United States, which includes two types of debt: the government’s debt to buyers of its securities (American individuals and legal entities, the Federal Reserve System, international investors, foreign governments) and the so-called intragovernmental debt. The article raises the question of where the "red line" is when the growing debt becomes dangerous for the United States. However, the article lists factors that mitigate the sovereign debt problem for the United States. Much attention is paid to the challenges that the administration of J. Biden and the Congress of the current and future convocations will have to face. In particular, in the short term, this is the need to reduce the budget deficit, to extend a number of social programs that are about to expire, but above all to resolve the debt ceiling issues. The paradoxes of decision-making in the budget process concerning the debt ceiling are considered. The points of view of experts are presented, arguing the need for refusal and preservation of the legislative codification of the debt ceiling. In the long term, the United States will face challenges such as a growing debt burden, the need to reform the budgetary decision-making process. The Congress will have to worry about how to defuse the time bomb laid down in a number of mandatory budget programs.


Keywords: federal budget | taxes | discretionary spending | mandatory spending | sovereign debt | intragovernmental debt | debt ceiling |

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