Federal Government Over the Last

Federal Government Over the last several years, the challenges facing the federal government have been increasingly brought to the forefront. This is because the total amounts of government spending have exceeded the revenues they are generating. The effects are that the national debt has been continually rising. Evidence of this can be seen in the below table which is highlighting the rate of these changes.

The National Debt Levels from 1970 to 2011 National Debt Debt Per Tax Payer $400 billion $4,123 $900 billion $9,183 $3.2 trillion $32,000 $5.6 trillion $53,000 $9.0 trillion $78,000 $13.6 trillion $121,000 $15.6 trillion $137,000 National Debt Statistics," 2012) These figures are showing how politicians are reluctant to make any kind of dramatic adjustments in spending and revenues. As a result, many have turned to different solutions to address these issues (i.e. PAYGO, line-item veto, Gramm-Rudman-Hollings and the Budget Enforcement Act of 1990). Despite these efforts, the total amounts of spending have continued to increase exponentially.

To fully understand what is happening there will be a focus on why politicians have been utilizing these solutions and if they are helping or creating more problems. Together, these elements will highlight the underlying reasons as to why the national debt has continued to rise in spite of various attempts to improve fiscal responsibility.

Why have we turned to policy solutions like PAYGO, line-item veto, Gramm-Rudman-Hollings and the Budget Enforcement Act of 1990? The reason why politicians have been utilizing different gimmicks in tackling the national debt is because it is unpopular. This is from everyone having to make tough decisions that will more than likely result in spending cuts and tax increases. These issues are troubling, as they create a divide about the overall scope of the changes and when they should be enacted.

(Kakutani, 2012) Moreover, many politicians are fearful about what will happen in their districts if they agree to these strict guidelines. This is because their constituents want them to bring back as much money as possible (from the federal government). These funds help to pay for special projects and promote job creation. (Kakutani, 2012) If there was some kind of dramatic reduction in these funds, many individuals will be upset with their officials about how they are hurting the local economy.

When this happens, the voters will turn on them in order to receive the assistance they require. This means that Congressional officials and the White House are reluctant to make the necessary adjustments (in order to address these issues). Instead, they have been utilizing various gimmicks to demonstrate how they are dealing with the problem. During the course of their reelection campaign, they can show how they helped to tackle the federal government's fiscal challenges and increased the number of projects / funding for various programs.

It is at this point that they are improving their chances of being reelected. (Kakutani, 2012) Are they really political solutions in disguise or creating more problems than solutions? As a result, these actions are creating more problems in the future. Evidence of this can be seen with observations from Greenberg (2012) who said, "Congress remains deeply divided about how to deal with the fiscal cliff's combination of automatic government spending reductions and expiring tax cuts, amounting to nearly 5% of GDP, which are set to take effect January 1.

The uncertainties raised by this approaching deadline are negatively impacting private sector sentiment and economic activity. Failure to act in a thoughtful way could have recessionary results, including another devastating blow to employment." This is showing how any kind of spending cuts and tax increases will have a negative impact on the economy over the short-term. It is at this point that there could.