Balanced budget is good for economic development and welfare activitie view the full answer. That's not always possible, like during a recession when we need spending to stimulate the economy, but right now the US is in an expansion and they should be trying to run a budget surplus by increasing taxes or cutting spending, or both. The panelists were nearly unanimous in saying that a balanced-budget amendment would not “substantially reduce output variability in the United States,” but there was less agreement as to whether such an amendment would make borrowing cheaper. If so then hopefully it would be enough to produce an excellent return on their investment that could potentially help the nation lower the current debit levels. Sometimes, a deficit may benefit its economy in a long run. “Suppose the government spends and borrows less,” wrote Harvard’s Oliver Hart in his response. Balancing the government’s budget sounds logical, as a matter of fact, that is the task of most Americans. Avoid increasing tax to businesses may help them to develop more projects and ending up helping the economy. The American government is in debt no doubt and a balanced budget is not going to solve the problem any faster. Congress is expected to vote this fall on an amendment to the Constitution that would require the federal government to balance its budget each … spending less in defense or joining another war). Overall, my opinion is that it is a must that the government balance its budget. The U.S. national debt is close to 14 trillion dollars. This is a tricky question. Those benefits have to be paid regardless of the budget availability. I don’t even think that is actually possible to balance the federal government’s budget on a yearly basis. by Tiffany Allen – Tuesday, August 5, 2014, 10:59 PM. Reduced revenue would make it more difficult for the government to balance its annual fiscal-year budget; over 10 years, estimates suggest, the tax bill could add between $500 billion and $1.4 trillion to the national debt. It depends on the situation. The government needs to start balancing its budget before the long-term effect becomes impossible to handle. But the notion that the federal government should always aim for a deficit of zero has little if any economic rationale. At this point with the national debit being as high as it is I would have to say a firm no that I do not think that the federal government should have to balance their budget. Michael Maiello | Such measures are also politically unsustainable. If the government increased the taxes, that would decrease income. Large, long-term deficits are harmful. Should the Government Balance its Budget? by Olutobi Osinowo – Tuesday, August 5, 2014, 10:03 PM. Net impact unclear.”Response: Uncertain. It happens daily in society on a much lower scale. At the end, it may slows the economy to grow. Balanced Budget Suddenly Looks More Appealing." If the government is not able to balance its budget, then everything will become a complete failure. That unfortunately is not the realistic case for America at this time. Should the government balance its budget? Yes, the US should definitely try to balance its budget. Should the government be required to always balance its budget? The government should be no different. A balanced budget for the Government generally means the difference between government incomes and expenses over an accounting period of one year. That makes government bonds more attractive than riskier corporate bonds. VAT Registration No: 842417633. ALL RIGHTS RESERVED. Working within a balanced monthly family budget has been my priority and personal preference, similarly I believe the government should keep a balanced budget as its top priority. “The gov(ernment) is way down the path of disappearance of a market for its debt, with the highest peacetime deficit/GDP ever.”Response: Agree, William Nordhaus, Yale Tiffany Allen – Tuesday, August 5, 2014, 11:19 PM. Pro. Economics Most people in the United States are familiar with balancing a budget because they have had to perform that task once in their adult life and it was not easy. Straight-jacketing the government is a mistake. You shouldn’t spend more than you make. Now the U.S. is in debt and most of its payment goes to the interest. Ok I got a few good answers on why our Government should not balance its budget. The amount of money that we are indebted to others beyond me, the only way that I can see the US ever coming out of debit is that if they are actually investing some of their borrowed money. It is known that good credit can get you anything and I believe that it should apply to all parties. Reducing transfer payments can end up hurting the poor whom are the most vulnerable during a recession, but an excessive amount of debt causes the government to spend more on funds on the interest for that debt instead of financing public programs and services. The U.S. can never be forced to default on debt denominated in dollars: It’s completely and totally … Just like how a family that borrows beyond its means will struggle a lot, so will government deficit spending cause much trouble in the long run and ultimately have the future generation pay for it. To continue to fleece us with interest payments on money the citizens didn't borrow. by Laura Porter – Saturday, August 2, 2014, 4:45 PM. It’s good to balance the budget but shouldn’t make it required as “always”. Theses entities are main focal points around the world which dictate or explain the financial state of society. All things in life need to be managed at some point to be proven effective. So all and all I think it’s a good idea based off of your view points and like you said not in an “always” situation should the federal government have to balance their budget. Cut the spending means people will get less benifit, there will be less federal employees to do work. If the government does not balance its budget, money will not be distributed properly and the economy could crash. Many US lawmakers have long voiced concern about the country’s growing debt and the regularity with which the federal government runs its annual budget at a deficit, and some have even suggested the US Constitution be amended to require that the federal budget remain in balance. 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