Essay: US government revenues and Spending-Borrowing
Borrowing is also a major source of money for the government. The government has occasionally borrowed heavily to supplement its budget. As at January this year, the US public debt was at $14.13, which is 96.3 percent of total GDP, 12th highest compared to other countries. This has proven a reliable source of money but has to be repaid at an interest that is very high in some instances (US Treasury Dept. 2010). International monetary fund IMF and the world bank are also major sources of money for the government as loans.
Basing on the year 2009 for example, Mandatory spending accounted for over half of the federal governments spending. This is made of all expenditures controlled legally, except in appropriations act, whereby, 34 percent went to social security, 25 percent to Medicare, 13 percent to income security, 7 percent to retirement and disability, and about 8 percent to other spending of this nature (US Treasury Dept. 2010).
Discretionary spending consumed 38 percent of the remainder. In these expenditures, 54 percent went to defense, 43 percent to domestic spending in projects such as agriculture, and highway construction. Only paltry 3 percent served international programs (US Treasury Dept. 2010).
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