Questions tagged [debt]

Questions related to the accrual of debt, may it be a nation, organization or person in a political landscape. Use this tag alongside the relevant tag in the context of the question i.e. a country if necessary.

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How could it be that the head of a Russian region asks officials to pay off debts of its residents?

As someone who has learned Russian, I read news from Russian news agencies from time to time, and one of them is TASS, a state-owned news agency, which has recently published a news article that left ...
Mitsuko's user avatar
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3 votes
0 answers
101 views

What happens to the national debt if a country breaks apart? [duplicate]

How does the debt get split up when a country breaks up? If, for example, Quebec were to separate from Canada, Quebec would probaly argue that it has no obligation to repay the debts to the Canadian ...
Hal's user avatar
  • 139
5 votes
0 answers
101 views

Is fiscal responsibility more difficult to practice in China since most of the spending is done by local governments? [closed]

Local government debt reached 92 trillion yuan ($12.8 trillion), or 76% of economic output in 2022, up from 62.2% in 2019. Part of it is debt issued by local government finance vehicles (LGFVs), which ...
Sayaman's user avatar
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8 votes
7 answers
10k views

Does Japan have any reason to ever repay its debt?

https://fortune.com/2015/02/26/japan-economic-time-bomb/ Takatoshi Ito, an economist at Columbia’s School of International & Public Affairs, argued at a panel discussion on Monday that unless the ...
Sayaman's user avatar
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1 vote
0 answers
79 views

Did China bail out its local governments in 2011?

There's this rumor-ish CNBC piece from 2011 (which is actually quoting Reuters on this part) claiming that: China’s regulators plan to shift 2-3 trillion yuan ($308-463 billion) of debt off local ...
the gods from engineering's user avatar
0 votes
1 answer
118 views

Apples-to-apples comparison of the public debt structure in the US vs. China

I'm looking for a comparison (i.e. two pie charts) of the public debt structure in the US vs. China. I can easily find data on the [hidden] municipal debt problem in China (as it's been repeatedly in ...
the gods from engineering's user avatar
5 votes
3 answers
502 views

How is China's municipal debt problem different from that of the U.S.?

https://www.reuters.com/markets/asia/china-can-no-longer-extend-pretend-municipal-debt-2023-08-06/ Most economists expect Beijing to instruct state-owned banks to keep rolling over maturing debt with ...
Sayaman's user avatar
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1 vote
1 answer
113 views

How do you measure debt sustainability (private and public)?

How do you measure debt sustainability (private and public)? https://en.wikipedia.org/wiki/List_of_countries_by_government_debt China has a lot public debt to gdp ratio. China’s debt is more than 250 ...
Sayaman's user avatar
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4 votes
1 answer
184 views

US Census Survey doesn't seem to ask about most debt-- How is US Gov't getting debt info?

I just received a 2023 American Community Survey from the U.S. Census Bureau, which took over an hour to fill out. The survey asked a slew of questions, in order to "give our country an up-to-...
Erin B's user avatar
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3 votes
1 answer
155 views

Can someone explain the debt ceiling clearly? [duplicate]

Now that we've gotten past the debate over raising the debt ceiling, so the world economy isn't going to hell next week, could someone explain it clearly? Most news sites describe it by analogy with a ...
Barmar's user avatar
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0 votes
1 answer
226 views

social security vs debt ceiling [duplicate]

If social security funds are held in a trust fund, why would not raising the debt ceiling impact social security payments? Wouldn't the trust fund be paying the beneficiaries from its reserves? At ...
mikem's user avatar
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18 votes
2 answers
7k views

What is the theory behind using the 14th Amendment to ignore the debt ceiling?

President Biden raised a few eyebrows in that he's said he isn't ready to invoke the 14th Amendment and ignore the debt ceiling... yet. From Reuters President Joe Biden said on Friday he was not yet ...
Machavity's user avatar
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3 votes
1 answer
297 views

What would happen if the US exhausts extraordinary measures, debt limit is not increased, and Treasury decides to ignore limit and issue new debt? [closed]

Treasury Secretary Yellen said this would be a "constitutional crisis". What would that entail? Would it be up to SCOTUS to tell the executive it can't do that? And then SCOTUS would what... ...
Matt Chambers's user avatar
3 votes
2 answers
248 views

Does the debt ceiling have any purpose? [duplicate]

The debt ceiling was created, more or less, by mistake - a remnant of a program where the other half was ruled unconstitutional. Less debt is better than more debt, but the only thing the debt ceiling ...
SegNerd's user avatar
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8 votes
1 answer
173 views

How can central government intervene when a council declares itself bankrupt?

As quoted by the Guardian and a local news website, Woking borough council is on the verge of bankruptcy (due to failed investments and financial mismanagement.) To put in context how much debt the ...
Boolean's user avatar
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13 votes
3 answers
6k views

Why all the warnings about failure to raise the U.S. debt ceiling when some argue that Biden could just ignore it?

In this article at CNN, Robert Hockett, a law professor at Cornell University says that the debt ceiling was rooted in the 1917 Liberty Bond Act which was rendered obsolete in 1974. Part quote from ...
neo's user avatar
  • 265
14 votes
3 answers
7k views

Why didn't Democrats get rid of the debt ceiling while they were in power?

Since 1995, Democrats and Republicans have been in constant disagreement over the debt ceiling, with Democrats wanting to raise it and Republicans resisting their efforts. During this time, Democrats ...
JonathanReez's user avatar
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18 votes
12 answers
6k views

Why is it considered controversial to reduce budget deficits instead of raising the debt ceiling?

Every year in the United States, there is usually a disagreement regarding the raising of the debt ceiling, which was especially noticeable in 2013 when it caused a government shutdown. Why is raising ...
JonathanReez's user avatar
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11 votes
1 answer
299 views

Is there a way to determine if a country engages in debt-trap diplomacy?

Is there a way to determine if a country engages in debt-trap diplomacy? There are people accusing China in engaging in debt-trap diplomacy, but China keeps renegotiating and cancelling debt while it ...
Sayaman's user avatar
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2 votes
0 answers
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What proportion of Chinese lending to Africa is interest-free, according to the World Bank?

I'm trying to figure out if some figures put out by Johns Hopkins CARI (China-Africa Research Initiative) in a WaPo piece include (or don't) the so-called "hidden lending" that China ...
the gods from engineering's user avatar
1 vote
2 answers
607 views

What benefits does China gain by waiving debt to African countries like this?

https://www.fmprc.gov.cn/eng/zxxx_662805/202208/t20220819_10745617.html What benefits does China gain by waiving debt to African countries like this? Second, we need to take concrete actions to ...
Sayaman's user avatar
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1 vote
3 answers
252 views

Has any government ever implemented a break-even tax policy?

I was reading Strong Towns by Charles L. Marohn Jr. In it, he describes how cities must have revenues that exceed expenses in order to survive. However, in his experience, most people react to the ...
elile's user avatar
  • 207
10 votes
1 answer
2k views

Why are student loan interest rates tied to inflation, not central bank interest rates?

In the UK, student loan interest rates, once studies are finished, are set as Retail Price Index (RPI) plus up to 3%. Every other variable rate of borrowing that I am aware of is tied to central bank ...
User65535's user avatar
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1 vote
1 answer
350 views

How did the alleged Chinese debt trap cause the economic crisis in Sri Lanka?

Sri Lanka is facing the biggest economic crisis since its independence. Its policy was wrong in some cases: Chinese debt trap. Due to lack of industrial growth, the Government of Sri Lanka provided ...
CADENTIC's user avatar
24 votes
7 answers
10k views

Why is it considered acceptable to freeze Russia's foreign reserves, but not acceptable for Russia to default on their debts?

Currently the following things are true: Western countries have frozen most of Russia's foreign currency reserves Russia is either in default or would be soon However #1 is seen as fair and ...
JonathanReez's user avatar
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30 votes
3 answers
9k views

Has Russia actually defaulted on its foreign debt as of April 11, 2022?

An article from CNN starts out by stating that Russia "has defaulted on its foreign debt", but then appears to qualify the statement by observing that "Moscow has a grace period of 30 ...
Robert Columbia's user avatar
15 votes
5 answers
3k views

Do Western countries want for Russia to default or not on its foreign debt?

According to TASS, Russia should be able to avoid defaulting on its foreign debt because now, as opposed to 1998, it has enough financial reserves. However, the issue is that a big fraction of its ...
Alexei's user avatar
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4 votes
2 answers
431 views

Since the West will no longer allow Russia to raise money by selling sovereign debt, what alternatives does Russia have?

are there any precedents of this ? What is generally the alternative in such cases ? Do other authoritarian countries help you finance debt ?
ashRawls's user avatar
34 votes
4 answers
8k views

Why first world countries have astonishing amount of foreign debts, but third world countries don't?

USA, for example, having a total foreign debt of over 23 trillion dollars (according to the statistics provided in 2019), is still on the frontline of those countries which are considered to be ...
Rameez Ul Haq's user avatar
-1 votes
2 answers
189 views

Is it possible that the US will default on its debt in foreseeable future? [closed]

The US has a history of having its debt grow, increasing the debt ceiling and repeating the cycle: Source Normally, the states don't default on debts denominated in their own currency, because they ...
kandi's user avatar
  • 3,365
3 votes
1 answer
348 views

When does a national debt become too much?

I've always heard that it's good for countries to have debt to spark growth, but at what point does a national debt become so big that it becomes a problem?
Good Shmorning 's user avatar
29 votes
2 answers
5k views

Why does the United States federal government have a debt ceiling? Isn't it entirely redundant to the budget?

In the United States, the debt ceiling limits how much money the federal government can borrow. This ceiling was apparently introduced in 1939. Why does the debt ceiling exist? Congress approves the ...
gerrit's user avatar
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6 votes
1 answer
263 views

How big a short term debt ceiling increase is McConnell agreeing to?

Senate Republicans have thus far refused to raise the debt ceiling, which needs to be raised by October 18 to prevent the US Government from defaulting on the national debt. They have been insisting ...
Keshav Srinivasan's user avatar
5 votes
1 answer
191 views

What new reconciliation powers has Schumer obtained?

Senate Minority Leader Mitch McConnell just sent a letter to President Biden explaining why Senate Republicans don't intend to vote to raise the debt ceiling, which needs to be raised by October 18 to ...
Keshav Srinivasan's user avatar
10 votes
3 answers
1k views

What is the point in having a debt ceiling when it can be relatively easily raised?

It makes some sense from a Machiavellian perspective; one can use the threat of a government shutdown to get concessions, but that's like playing chicken, and seems really irresponsible even if your ...
Ryan_L's user avatar
  • 7,609
9 votes
1 answer
836 views

When was the least bipartisan debt ceiling increase or suspension, in the past 30 years?

Pelosi said in an interview aired a couple of days ago (on Hill TV at least) that raising the debt ceiling has "always been bipartisan". Later, in the same video segment McConnell says ...
the gods from engineering's user avatar
4 votes
2 answers
298 views

What danger(s) does Chuck Schumer see in using reconciliation to increase debt limit?

Treasury Secretary Janet Yellen has said that if Congress does not raise the debt limit by mid-October, 2021, the U.S. could default, which could have macroeconomic implications. The Senate minority ...
Burt_Harris's user avatar
  • 8,029
6 votes
1 answer
453 views

Can Congress really raise or suspend the debt ceiling through budget reconciliation with a simple majority in the Senate?

Some background info here The federal debt ceiling has currently been suspended until August 1. If this year so far is any indication, Senate Republicans will do everything possible to use a debt-...
user1258361's user avatar
1 vote
0 answers
121 views

Is there a ranking of countries based on debt, with unfunded liabilities included?

The "Truth In Accounting" website claims that the US has $123 trillion of debt, if "unfunded liabilities" are taken into account. Is there a global ranking of states based on such ...
JonathanReez's user avatar
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1 vote
1 answer
194 views

What has Biden said about government debt?

It seems to me that Biden is spending a lot of money on new bills, and from my understanding of economics this means that government debt will greatly increase. Has Biden ever talked about this during ...
Ekadh Singh - Reinstate Monica's user avatar
41 votes
4 answers
10k views

Why are US student loans nearly impossible to remove via bankruptcy?

In the United States it is very hard to get rid of student loans. They cannot be discharged in bankruptcy except for under extenuating circumstances. I find that bizarre given how people are ...
Number File's user avatar
  • 12.1k
4 votes
1 answer
356 views

How are UK devolved nation’s budget deficits funded?

The Scottish Government has tax raising powers and, over the past several years, expanded spending powers too. However, I’m wondering how budget deficits for these devolved administrations are funded. ...
Hamish Gibson's user avatar
1 vote
1 answer
239 views

How does one determine the source of funds (money) for a government expenditure?

When a government decides to spend money, they have 3 primary choices (please correct me if I'm mistaken): Spend money they already have (from taxes) Borrow money (from people/organizations within ...
End Anti-Semitic Hate's user avatar
25 votes
2 answers
5k views

Is US Congressional spending “borrowing” money in the name of the public?

Watching the C-SPAN feed in regards to the American Rescue Plan, Rep. Tom Rice insists that we are "borrowing ~$5,500 for every man, woman, and child in [the US]." I remind the people back ...
Drise's user avatar
  • 361
3 votes
0 answers
137 views

What specifically happens to a country when it defaults on its debt? [duplicate]

Background Back in March of last year, Lebanon defaulted on its debt and has since been in a state of abject discombobulation. But the effects of this just seem to add on effect to a country that is ...
isakbob's user avatar
  • 5,487
7 votes
2 answers
189 views

Which country is responsable for the external debt if half of the states of a country become independent? [duplicate]

After the lawsuit of 18 states joining Texas against some Democratic states (plus 2 counties from California/Nevada which want to become new states), and after that seeing some Texan republicans ...
Pablo's user avatar
  • 1,971
15 votes
4 answers
5k views

What does it mean when something is said to be "owned by taxpayers"?

There are 470,000 results on Google Search for "owned by taxpayers". Some excerpts: RBS remains 62% owned by taxpayers after a 45 billion pound bailout in the 2008 financial crisis. (...
gerrit's user avatar
  • 48.3k
8 votes
5 answers
5k views

When the dictators execute the coup and become the head of the country do they pay the international debts of country?

There are so many coups happened in the history, and many of them in 20th century only, and after every coup a single man becomes the main head of the country, often called as dictator. My question is ...
Knight admires Chappo's user avatar
1 vote
0 answers
87 views

Joe Biden's Student Debt Plan and Public Service

Joe Biden says he will cancel up to $10,000 dollars of student debt for those who are in public service. Most media outlets are defining public service as "schools, gov't jobs, and non-profits.&...
Jonathan L.'s user avatar
39 votes
5 answers
6k views

How does debt-trap diplomacy work?

Debt-Trap Diplomacy In the micro world of personal loans, a person will go to a bank, and say, for example: "Here's a contract: You give me $1 million, and I'll pay it back to you on XYZ schedule ...
Ertai87's user avatar
  • 2,436