Contact Us
Sign In / Sign Up for FREE
Go to advanced search...

The U.S Debt Ceiling - Term Paper Example

Comments (0) Cite this document
The U.S Debt Ceiling Name: Institution: The U.S Debt Ceiling The U.S. debt ceiling is a lawful method of restricting the amount of national debt, which can be issued by the American Treasury (Levit et al., 2013). It is also known as the debt limit (Abotalaf, 2011)…
Download full paperFile format: .doc, available for editing
GRAB THE BEST PAPER97.2% of users find it useful
The U.S Debt Ceiling
Read TextPreview

Extract of sample "The U.S Debt Ceiling"

Download file to see previous pages In essence, it can just limit the Treasury from settling expenditures once the limit has been achieved, but which have already been permitted and appropriated. When the debt limit is normally reached devoid of any raise in the limit having been passed, the Treasury has to use extraordinary measures to provisionally fund government expenditure and responsibilities till a resolution can be reached. The U.S. Treasury has never, in the past, reached the level of wearing out extraordinary actions, leading to a default, even though the Congress, on a number of occasions, seemed like it would permit a default to occur (Masters, 2013). Managing of the U.S. public debt is a significant aspect of the macroeconomics of the country’s financial system and economy, and the debt limit is a restraint on the Treasury’s capacity to run the United States economy (Abotalaf, 2011). However, there are talks on how the U.S. financial system should be controlled, and whether a debt limit is a suitable method for restraining government expenditure (Abotalaf, 2011). This paper will discuss the consequences of debt ceiling in the United States economy, how the country got there and how they can get out of it. What the United States Got to the Current Debit Ceiling In Article I, Section 8 of the American Constitution, only the Congress can consent to the loaning of money by the United States on credit (Levit et al., 2013). From the independence days of the U.S. till the early 90’s, the Congress openly consented to every singled debt issued (Masters, 2013). To offer more elasticity to support the U.S.’s involvement in the First World War, the Congress modified the technique through which it legalized debt in the 1917, 2nd Liberty Bond Act. Under this law, the Congress created a summative limit also known as a “ceiling”, on the overall amount of fresh bonds, which could be issued (Austin et al., 2012). The current debt limit is a summative limit relevant to almost all national debt, which was significantly created by the both the 1939 and 1941 Public Debt Acts that have consequently been amended to transform the limit amount (Abotalaf, 2011). From time to time, political disagreements occur when the Treasury informs the Congress that the debt limit is almost to be reached (Masters, 2013). When the debt ceiling is achieved and pending a raise in the limit, the Treasury can use "extraordinary measures" to seek extra time before the limit can be increased by the Congress (Austin et al., 2012). The U.S. has never got to the level of a default where the Treasury was not able to pay United States debt requirements, even if it has been close on a number of occasions. The only exemption was in the 1812 War when a number of areas in Washington D.C., and also the Treasury, were burned to the ground (Levit et al., 2013). The U.S. reached, in 2011, a crisis level of close to a default on public debt. The holdup in raising the debt limit led to the initial downgrade in the U.S. credit ranking, a quick plunge in the stock market, as well as a raise in borrowing expenditure. Another debt limit crisis developed in early 2013 when the ceiling was reached once more, and the Treasury assumed extraordinary measures to evade another default (Levit et al., 2013). The 2013 debt limit crisis was settled, for now, on 4th February, 2013, when the President consented to the No Budget, No Pay Act and also delayed the debt ...Download file to see next pagesRead More
Cite this document
  • APA
  • MLA
(“The U.S Debt Ceiling Term Paper Example | Topics and Well Written Essays - 2000 words”, n.d.)
The U.S Debt Ceiling Term Paper Example | Topics and Well Written Essays - 2000 words. Retrieved from
(The U.S Debt Ceiling Term Paper Example | Topics and Well Written Essays - 2000 Words)
The U.S Debt Ceiling Term Paper Example | Topics and Well Written Essays - 2000 Words.
“The U.S Debt Ceiling Term Paper Example | Topics and Well Written Essays - 2000 Words”, n.d.
  • Cited: 0 times
Comments (0)
Click to create a comment or rate a document


Debt ceiling

...? Debt Ceiling Debt ceiling is the limit to which debts can be borrowed. The debt ceiling as perceived in the United States is the maximum amount of debt that can be borrowed by the United States in order to run its operations. The process through which debt is borrowed by the government is by issuing bonds. The government issues bonds in order to raise the debt and the holders of such bonds hold the position of a creditor. The bonds have a date of maturity and a rate of return, and these are held by individuals or organizations as available for sale as well. Due to the application of debt ceiling, there is a limit to the amount borrowed by the United States through such bonds, which means the overall deficit in the federal budget cannot...
6 Pages(1500 words)Essay

CLS v. Martinez, 561 U. S

...?A LEGAL BRIEF ON THE RECENT U.S. SUPREME COURT RULING IN CLS V. MARTINEZ, 561 U. S. On June 28, the United s Supreme Court gave a ruling on the CLS vs. Martinez, 561 US ___130 S.Ct. 2971, 177 L.Ed.2d 838 (2010). The case was filed by the Christian Legal Society (CLS) at the Hastings College of Law at University of California on the ground that official governing groups should accept all the students regardless of their beliefs and status to acquire recognition. The respondents were Leo Martinez, Acting Chancellor and Dean of Hastings College of Law, University of California; Jacqueline Ortega, Student Services Director; the Board of Directors of Hastings College of Law, University California: Donald Bradley, Tina Combs, Maureen Corcoran...
3 Pages(750 words)Coursework

The growth of the U. S. Military

...? The Growth of the U.S Military The Growth of the U.S Military The United s military has existed since 1775. During thefight for independence, the United States incepted the continental military in order to take responsibility of the revolutionary war of the time. In 1784, an official army came in to place to replace the continental army shortly after its disbandment. This gives the American army the longest existence in history. The first army won the war to independence although there was little professionalism. The American military has progressed from the unprofessional beginning to what it is today. In the 21st century, the American army has the largest defense budget in the world. The military makes use of advanced technology...
6 Pages(1500 words)Research Paper

Complexities of the U. s financial system

...? Complexities of the U. S financial system Complexities of the U. S financial system The US financial system is extremely complexand is affected by a number of environmental factors, which include the economy and federal regulations. The complexities inherent in the US financial system also impact different aspects of the economy, as well as the existence of businesses and individuals in the country (Pryor, 1996). This paper will examine the complexities of the US financial system, discussing different aspects of the system, for instance, financial markets and the Federal Reserve System. The US financial system consists of the financial markets, which impact individuals, businesses and the economy. Efficiently operating financial markets...
3 Pages(750 words)Assignment

U. S. Constitution

...US Constitution s right in American political system refers to the political rights reserved for the governments. Even though America asa whole has a federal government, each state in America has separate state governments. US constitution provides some specific rights to the state governments in law making even though all the state governments are operating under the federal government. The rights of the state government are protected by the tenth amendments (Part of bill of rights) in US constitution. According to The Tenth Amendment to the U.S. Constitution; “The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States, respectively, or to the people” (Tenth Amendment...
1 Pages(250 words)Essay

The U>S Legal System

... Legal Issue and a Strong and Substantiate Argument in Support of Your Opinion Task The case is centered on two counts: counts of murder and burglary. On the count of murder, the defendant is accused of the first degree murder. First-degree murder, in most states, is an illegal killing that is both premeditated and willful, meaning that it was committed after "lying in wait" or planning for the victim. In this case, the deceased had earlier wanted to dispose of some of her diamond rings, though not clear. The defendant may have been involved in the deal and latter planned to kill her for the rings. That again introduces another crime committed – burglary. Based on the evidence provided, the defendant broke into Stella Blauvelt’s... Legal...
1 Pages(250 words)Assignment

The debt ceiling

...Should Debt Ceiling be raised without Other Conditions Attached? The national debt ceiling is a limit set by Congress to control the amount of money the US government may borrow at any giving time. Without the debt ceiling, the budget deficit may push the national debt to wanting levels. This is because any elected government would always increase spending to make the electorates, as well as, those who funded their campaigns happy. Over the last one decade, the US government has increased the debt ceiling at around ten times. The last time the debt ceiling was raised was in last year, august, reaching $16.69 trillion. This happened since the government did not want a repeat of 2001 fiscal crisis, which was because of the Congress refusing...
1 Pages(250 words)Term Paper

U S History

... "Crisis of Confidence" in the United s The United s was a dominant world power in the 1970’s even though the countries self-perception was mired in doubt and malaise. The stagflation of the country’s economy, the experience and results of the Vietnam war, the lack of confidence of the government by the people as it was no longer perceived as a champion of freedom, the Watergate imbroglio all contributed to the “crises of confidence” in the country. The debt on the dependency of US citizens and the government increased resulting to difficult times. Jimmy Carter came into power at the time after the country’s failure in the Vietnam and Watergate scandals. A leadership crisis emerged that was characterized by deep and widespread lack...
2 Pages(500 words)Admission/Application Essay

United States National Debt Ceiling

The debate was related to the appropriate level of Government spending and its impacts on the overall debt and deficit of the country. The crisis was so significant that it affected the US stock market heavily. Prices of the Federal bonds increased like anything and investors were significantly confused about the future economic situations of the world’s oldest democracy. Political fraternity across the country was raising their voices to cut down the governmental expenditures to manage the debt ceiling. The budget deficit was increasing, to tame that deficit debt ceiling was a reactive measure. Due to this economic turmoil, credit rating agency Standard & Poor’s downgraded the credit rating of the USA for the firs...
7 Pages(1750 words)Assignment

The International Debt Crisis

...Development Economics аnd internаtionаl debt crisis Introduction Debt is one of the most contentious аnd emotionаlly chаrged issues in the debаte аbout globаlizаtion аnd development. It hаs become more of а morаl crusаde thаn а question of globаl politicаl economy. It is аlso technicаlly complex, involving dynаmic interplаy of the weаk (debtors) аnd strong (creditors), under the influence of globаl аnd domestic mаcroeconomic аnd microeconomic forces, geopolitics, history, аnd governаnce systems аt home аnd аbroаd. It hаs generаted а series of intrаctаble problems with no eаsy solutions. Аccordingly, аlthough аll world leаders, including the Pope аnd Nelson Mаndelа, hаve cаlled for the eliminаtion of debt, techniciаns hаve not found...
15 Pages(3750 words)Coursework

S&T Debt Factors

The agreement contains a credit default contracts that include credit default swaps, default index contracts, credit default options, and credit default basket options. One can use these as part of the mechanism that is collateralized by debt obligations. The goal should be to establish a price for a given risk and controlling credit based on risk. The credit can be allowed by minimization of risk. Credit controllers should develop versatile tools that transfer risk away from a lender’s balance sheet.
d) With reference to the proposed debt counseling business, illustrate and explain exactly how you would organize the debt counseling operation, taking particular care to explain how and when you would receive payment for...
6 Pages(1500 words)Case Study

Australia's External Debt

... External debt is defined by the Banking Dictionary as the total amount of bank debt owed by debtor nations to foreign lenders and creditor banks. Foreign lenders and creditor banks (collectively the creditors) can be other governments, commercial banks, international financial institutions such as the IMF and the World Bank, corporations, or households. The International Monetary Fund (IMF) defines gross external debt as the outstanding amount, at any given time, of current, not contingent, liabilities that require payments of principal and/or interest on the debt at some point(s) in the future and that are owed to nonresidents by the residents of an economy. (citation.. . .) The elements of the definition are clear enough, but some...
10 Pages(2500 words)Assignment

How Did Radio in the 1960's Mark the Changing Social Order in the UK and US

...How did radio in the 1960s mark - and even actively promote - the changing social order in the UK and US? The 1960s saw perhaps the greatest social changes in history. For the first time young people and their parents were divided. They had different cultural ideas and little middle ground to understand each other. The music tastes, social conventions and political beliefs of the older generation had been violently rejected by a disaffected youth which sought to establish a new social order. These were times of change, times of disaffection and times in which a whole new social network was being established. This took the form of underground movements, independent press and pirate radio. This essay will focus on this final tool... did radio...
7 Pages(1750 words)Term Paper

The National Debt

... that, there has been an increment of more than thirteen trillion additional debts. Therefore, by 2025, the national debt will be 28 times the value of debt 30 years ago (Sandak 102). The debt ceiling However, critics in some quarters are quick to point out that we do not need to be alarmed about the national debt since the debt ceiling will be able to alleviate the effects of the extreme national debt. Politicians have for years argued that, through their policies of debt ceiling, the nation is going to emancipate itself from the effects of the extreme national debt. Some economists argue that the national debt is not as dangerous as it seems since the nation can inflate its way out of debt. However, the debt ceiling does not sound...
6 Pages(1500 words)Assignment

The U.S. National Debt

... and deregulation of industry lines the pockets of the top one percent at the expense of the other 99 and future Americans as well. Works Cited Dinan, Stephen. “Deficit on Track for a Record This Fiscal Year” The Washington Times (February 14, 2011). Web. March 8, 2012 <> Freeman, Robert. “Evaluating Bush’s Economic Performance: A Field Guide for the Perplexed.” Common Dreams Newscenter. (September 27, 2004). Web. March 8, 2012 Johnson, Simon. “Does the U.S. Really Have a Fiscal Crisis?” New York Times (February 24, 2011). Web. March 8, 2012 u-s-really-have...
9 Pages(2250 words)Coursework

Teacher`s Personality Qualities

A teacher is a psychologist who must find a separate approach to every single individual he meets on the way. Thus, teaching is a complex and multifaceted task that requires knowledge, communication skills, and special personality traits. However, being a good teacher is not having an inborn talent, it means being able to improve constantly. In this paper, I want to argue that constant self-development is one of the crucial components that make a great teacher as every quality required from a great teacher is a matter of practice and experience.
There exist certain prerequisites, certain “musts” for being a good teacher. A subject matter knowledge is considered a core of the teacher`s profession. The teacher is s...
8 Pages(2000 words)Case Study

Towards Solutions to the US Debt Crisis

The national debt became 32% of a gross domestic product after the First World War (Chantrill, 2014, Para 1).
The Great Depression then followed, where the then President decided to boost the national debt to 40% of the gross domestic product. He did this by using his way; the local governments also did the same thus improving the state debt by over 5% of the gross domestic product. In 1993, the domestic public debt was over 28%. The state, federal, and government debts all rose by seventy percent of the GDP (Chantrill, 2014, Para 2).

Unfortunately the United States into a new debt in the Second World War. In 1941, the gross domestic product was 45 percent; it rose up to 119 percent in 1946 probably at the end of t...
6 Pages(1500 words)Assignment

Reasons for Debt Crisis

... Reasons for Debt Crisis The ‘Moment of Truth report’ outlines the looming economic crisis that is bound to hit the American nation if certain policies are not changed. Debt is steadily increasing with most citizens unwilling to sacrifice their spending to guarantee sustainable growth of the country. This aspect jeopardizes the ability of future generations to acquire resources for their survival. Apart from this the report formulates proposals that could ensure change is implemented and appreciated by the American people. It calls for political unity and advocacy to come up with better ideas to change the current debt situation. Federal debt is one of the very few, but crucial reason that is leading to the looming fiscal crisis...
6 Pages(1500 words)Assignment

The Difference Between Religiousness and Faith in Flannery O`Connor`s Revelation

... The Difference Between Religiousness and Faith in Flannery O`Connor`s “Revelation” The short story “Revelation” by O`Connorexamines one of the most delicate aspects of faith in God – its deep essence and verity. It seems that for most religions adherence to certain rituals and literal following the Scriptures can be enough for considering oneself a true believer but everything is not as simple as it seems. But even interpretation of the Holy texts requires knowledge and ability to grasp the deep meaning behind metaphors. Religion is just the coverage of faith while what real faith means is the major question for all those who believe in God. The principle character of O`Connor`s “Revelation” Mrs. Turpin seems to be perfect Catholic woman...
7 Pages(1750 words)Book Report/Review
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.

Let us find you another Term Paper on topic The U.S Debt Ceiling for FREE!

Contact Us