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gizzy98 asked in Social ScienceEconomics · 1 decade ago

How does a current budget deficit affect future workers?

How could a policy by the current government to reduce the national debt hurt these future workers?

4 Answers

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  • meg
    Lv 7
    1 decade ago
    Favorite Answer

    They will have to pay higher taxes to pay the interest on the debt, but because of the growth in nominal GDP, the burden of paying the extra taxes diminishes with time.

    The extra taxes now needed to balance the budget will slow the economy and if the unemployment rate is already high will cause it to go even higher. However in a booming economy the slowing of the rate of growth is not necessarily a bad thing. That is if taxes does not slow things down inflation will begin to increase and the fed will use monetary policy to slow growth.

  • 5 years ago

    Current Budget Deficit

  • 1 decade ago

    Listen, some of this spending is going to crap ideas that do nothing to support full employment. Some of the spending actually encourages idleness and over dependence on the government. The workers of the future will have to give up their pay to pay the taxes needed to support this monstrous debt. It is like we are feeding off the flesh of our future.

  • Anonymous
    1 decade ago

    reduce the national debt = more taxes now = less money in private hands = less capital investment = lesss jobs for future workers

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