Fiscal Policy
The occurrence of debt, deficits or surplus has and always will have an impact on someone or something. This could reference either too little, too much or money owed. When these instances occur the mainly effect are taxpayers, Social Security and Medicare users of the future. There are plenty more affected such as students, the unemployed, the United States and even companies conducting exports and imports. The United States holds a fiscal policy that holds both negative and positive outcomes. This policy essentially adjust the spending limits and tax rates to regain control of economic finances.
Taxpayers have the most important role in the economy. The supply most of its income. The top 10 percent alone of tax payers provide over 70% of tax expenses. Deficits have a huge impact on taxpayers. Deficits leads to devaluation of money and furthermore places numerous burdens on the taxpayer. The need for increased taxes create losses for taxpayers. On the other hand when the surplus comes around the taxpayers reap great financial benefits. The surplus could lead to a decrease in taxes. Meaning extra money in the taxpayers pocket. Debt along with surplus and deficits have determining impacts on taxpayers. Considering the term alone, debt, projects this is a negative impact. During debt circumstances taxpayers have the role of generating capital used to reduce debt.
Not only are taxpayers affected by deficits, surpluses and debts but also the people that participate in programs such as Medicare and Social Security. Believe it or not when the United States fall into a financial deficit the government will reduce the amounts paid out to these programs. Social Security for future recipients will have a hard time trying to gain help from the government concerning bills and healthcare. If expenses are decreased due to deficits less people will receive health care benefits in the future. On top of that for retired citizens of America, Medicare is the leading health care plan. Social Security and Medicare recipients take a huge hit when the deficit arises.
Financing the wars through debt requires interest payments as well. The US paid about $200 billion in interest on war spending during the first decade of the wars. If war spending continues as forecast by the CBO, the country can expect to have paid about $1 trillion in interest by 2020.(Brown University)