The Growth of Public Debt and Very Low Savings Rate

The Growth of Public Debt and Very Low Savings Rate

The public debt consists of the borrowed by public central authorities , by territorial , administrative and other public entities , from creditors on the internal or external market

In the United States , public debt is also called the national debt gross federal debt or U .S . government debt . The U .S . public debt is consisted of the amount of money owed by the United States government (either central government , federal government , municipal government or local government ) to creditors who hold US debt instruments (treasury

securities , such as : treasury bills , treasury notes , treasury bonds and savings bonds . These treasury securities are issued by the United states Department of the Treasury through the Bureau of the Public Debt , one of its agencies . The Bureau of the Public Debt is responsible for borrowing the necessary amounts of money for the Federal Government . The Bureau of the Public debt is also responsible for the resulting debt and for providing reimbursable services to other Federal agencies

The obtained amounts of money , in the form of treasury securities , may be traded , but it is rarely spent on goods and services . The Government prefers to borrow these amounts of money instead of simply printing it so that the expected increase of inflation due to the increase of national wealth can reach a lower level

The Bureau of the Public Debt considers the Public Debt as divided into two categories : debt held by the public and intragovernmental holdings Intragovernmental debt includes money for government trust funds 9 such as pension plans ) and the debt for social security

The US public debt reaches one of the highest levels in the world

Table 1 : The US Public Debt 2000-2005

Date Amount

09 /30 /2005 7 ,932 ,709 ,661 ,723 .50

09 /30 /2004 7 ,379 ,052 ,696 ,330 .32

09 /30 /2003 6 ,783 ,231 ,062 ,743 .62

09 /30 /2002 6 ,228 ,235 ,965 ,597 .16

09 /30 /2001 5 ,807 ,463 ,412 ,200 .06

09 /30 /2000 5 ,674 ,178 ,209 ,886 .86 The information in Table 1 clearly shows that the US Public Debt has increased annually

William K . Tabb reveals in the first issue of Monthly Review volume 58 that The United States buys 50 percent more than it sells overseas enough to sink any other economy . In another economy , such a deficit would lead to a severe devaluation of the currency , sharply inflating the price of imports and forcing the monetary authorities to push interest rates up considerably . In Tabb 's opinion , There is a clear thread that connects domestic developments in the U .S . income distribution , debt-funded growth , the increased dominance of the rentier capitalists who profit from these developments , and global ambitions and the projection of imperial dominance . It seems that the increase in the upward redistribution of income has determined the investors to search for new opportunities on the external markets , being forced into this direction by the slower growth and saturation of the...