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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10
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1answer
359 views

Has any government made the unwinding of their US bonds and currency reserves a core public policy plank or a legal requirement?

The betting odds (at time of writing) on a partial US debt default this year were 6/4 - Default and 1/2 - No Default. Considering the odds, this is something of a wake-up call for nations and ...
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1answer
98 views

How effective would a student loan forgiveness program be if it only applied to governmental loans? [closed]

How effective would a student loan forgiveness program be if it only applied to Federal student loans, with private loans being exempt? For example, my student loans exceed $160k with less than $10k ...
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4answers
10k views

Why does the UK government write off student loan debt after 30 years?

In the UK, if you haven't paid back student loans within 30 years they are written off. Why would the government institute such a policy? As far as I can see, it results in most people not paying back ...
49
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3answers
8k views

Do separatist nations inherit any national debt?

Do separatist nations inherit any national debt? For example, given Spain has a debt level of £1.1 trillion at the time of writing, if Catalonia becomes an independent nation is there any legal ...
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5answers
4k views

What are the consequences if a country decides to selectively cancel debt?

(Not sure if this should be on the Economics SE; however I am interested in both economic & political consequences) Trump threatens new tariffs on China as US mulls retaliatory action over COVID-...
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2answers
4k views

How did the US bring down federal debt ratio after World War II?

I saw this infographic about the ballooning US Federal Debt-to-GDP ratio and how it might exceed WWII levels: https://www.bloomberg.com/graphics/2020-debt-and-deficit-projections-hit-records/ But I ...
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5answers
3k views

What are the benefits of the proposed Euro/Corona bonds over conventional government bonds?

This article describes the efforts of several European Union countries to agree to issue "corona bonds" or "Eurobonds", which are a joint EU mechanism to issue joint debt shared between different ...
47
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5answers
8k views

How is Japan able to sustain a large debt as a percentage of GDP, while Greece could not?

Japan is currently the nation with the highest debt as a percentage of GDP - at the time of writing it stands at over 250%. Greece, currently the second most indebted nation, went through a decade-...
3
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1answer
179 views

At what point would US government lose control over its national debt? [closed]

From this wiki page we can clearly see that US national debt is growing steadily after 2010 and now it's larger than US GDP already (at the end of 2019). Still it's commonly believed the debt is ...
3
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1answer
312 views

Is there any European Union country that had or have a “debt brake” similar to Germany?

Germany has in place a "debt brake": In 2009 it was approved with a two-thirds majority both by the Bundestag and the Bundesrat. This decision will lead to public budgets without structural ...
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13answers
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What are the downsides of being a debt-free country (no foreign national debt)?

I was only a child when the Romanian dictator, Ceaușescu announced that all of the country's foreign debt had been paid: Romanian leader Nicolae Ceausescu announced this week that his country, ...
7
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1answer
316 views

What would be the repercussions if Venezuela defaulted on Russia's loan?

Recently the Russian Ministry of Finance stated it expects Venezuela to provide payments on time. Given the U.S. has imposed sanctions against Venezuela, would the economic influence on Venezuela ...
60
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10answers
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What will happen if China stops loaning money to the U.S.?

US's external debt to china is a staggering 1.1 trillion US dollars and according to many economists, it's highly unlikely that U.S. will be able to pay back the entire external debt to China in the ...
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3answers
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Why does the U.S. keep pushing “the debt trap” narrative in Africa when China is not the major source of debt distress in Africa?

https://static1.squarespace.com/static/5652847de4b033f56d2bdc29/t/5c467754898583fc9a99131f/1548121941093/Briefing+Paper+1+-+August+2018+-+Final.pdf We find that Chinese loans are not currently a ...
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2answers
459 views

What happens if a country redefines itself?

Consider the following possible scenarios for a country A: The legislature decides to change the name to B After a successful revolution or coup d'état, a new country is established having the same ...
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2answers
413 views

Is Hillary Clinton on the hook for the $30 million debt of her campaign?

In Why do US politicians spend so much on campaigns when the salary is not high enough to justify the expenditure?, it is mentioned that Hillary Clinton has $30 million of debt from her 2008 campaign. ...
10
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3answers
436 views

Why does the US federal debt increase by more than the US deficit each year?

I was looking through the Historical Tables from the Office of Management and Budget (https://www.whitehouse.gov/omb/historical-tables/). I noticed that each year the debt increases by a different ...
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1answer
146 views

What is the purpose of (student) debt forgiveness? [closed]

What is the purpose of student debt forgiveness? Which problem does it attempt to solve, and how does it go about solving it? Specifically, What is the problem? A student in debt is a person in debt ...
6
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3answers
456 views

Why does Berlin have debt issues in opposition to many other European capital cities?

According to this article Berlin seems to be a strange capital city when it comes to debt: In almost every European country the capital is the engine of the economy. But a new study shows there ...
8
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2answers
227 views

Eurozone countries surpassing their allowable deficit of 3% GDP

What happens when a eurozone country breaks EU fiscal rules that limit the allowable deficit to 3% of GDP?
29
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4answers
16k views

Who was the last US President to oversee a reduction in debt?

As of 2012, the United States currently has ~16 trillion in debt. The last five presidents have all added to the overall debt*. Who is the last US president to decrease the total amount of debt ...
6
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5answers
398 views

What steps can be taken to combat unfunded state and federal pension liabilities in the U.S.?

It's the growing problem that no politicians want to talk about: unfunded pension liabilities. Business Insider ran an article last year which focused on the many upcoming challenges facing U.S. ...
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1answer
87 views

Causes of a sovereign debt crisis?

What are the causes of a sovereign debt crisis? How can countries get out of a sovereign debt crisis?
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4answers
1k views

The US has done lots of Quantitative Easing, so why does it not do the same for its debt?

The US government owes lots of money. When US-based banks and other financial institutions faced a similar problem (ok, not a similar problem, but a crisis) - the US government, through the Federal ...
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2answers
196 views

Could Italy's need to finance its public debt be a menace for the EU?

In the following article Italy’s populists turn to Trump and China it appears that Italian government is now seeking new alliances outside Europe to finance its debt, given that the ECB is coming to ...
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5answers
955 views

How long would it take to pay off the U.S. national debt if new deficits were eliminated?

If Congress stopped borrowing money, how long would it take to pay off the national debt? My question assumes—perhaps incorrectly?—that every dollar the Federal government owes must be paid back on ...
18
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4answers
963 views

What are the practical effects of having too large a debt load?

My understanding is that Japan has a debt-to-gdp ratio of approximately 200%. It is considered to be one of the worst in the world. The United States is only in the 100% range. What effects would ...
0
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2answers
306 views

How much in interest payments since 2002 has the increase in the debt past the old debt ceiling cost the US?

Wikipedia notes several recent changes to the debt ceiling. Increases in the debt ceiling allow the Treasury to borrow more money and increase the national debt to a level higher than previously ...
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2answers
133 views

What are the criteria for avoiding the fiscal cliff?

One of the biggest items in the news is that we will go off the "Fiscal cliff" (large amount of tax increases and spending cuts) if Congress doesn't come to an agreement of some kind. My question is: ...
6
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5answers
696 views

If Jim, a random citizen, owes TD Bank $300,000 for his house mortgage, is this added to the U.S. national debt?

According to Wikipedia: National debt consists of two components. The first is Debt held by the public, such as Treasury securities held by investors outside the federal government, including ...
5
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2answers
438 views

Is there legal recourse for creditors if Treasury defaults on any (not necessarily all) of its debts?

This is a follow up to a previous question I had here Fed Authority I understand that once the government goes into default it triggers a number of different legal steps and procedures, such as CDS ...
6
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1answer
467 views

Did any legislation ever introduce something like the Chicago Plan?

The Chicago plan involves to impose a 100% reserve on banks, so that banks can no longer create money by lending out. Recently, IMF published a note called The Chicago plan revisited. I'm no economist ...
100
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9answers
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Why is Greece's debt considered a problem but not US debt, which is much larger?

Greece's and other southern European countries' debt has been considered a problem since the 2008 crash, and austerity measures have been forced to the people. However the United States also have a ...
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2answers
1k views

What's the most accurate account of the current President's monetary debts?

The President owes some money. In 2016 Fortune estimated he owed $1.1 billion. Last December Mother Jones estimated he owed over $700 million, not including $2 billion in debt by real estate ...
3
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2answers
659 views

Repaying high debt in a country, without get ruined, is it possible? Example?

In another question it was asked what it means to a country if it has a high debt. I'd like to know whether there are there examples of a country paying back high (100%+ Debt to GDP ratio) debt? I ...
4
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1answer
139 views

Does the US constitution have a clause/procedure for defaulting? [duplicate]

Current US debt stands at 20+ trillion. Is there there a clause or rules/procedures on defaulting in the US constitution? If so, how are the distribution of assets and liabilities handled?
12
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3answers
4k views

Why does Russia have such a small debt (debt to GDP ratio) compared to the vast majority of Western countries?

This chart shows that Russia has a very low debt/GDP value compared to most of the other major countries. Quora answers indicate pure economical reasons (huge amount of natural resources and ...
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7answers
6k views

Can a country sell part of its land to pay off huge national debt?

I know that in history, countries have sold certain parts of their territories to other countries. If a country is in massive debt today, and they feel there is no way they can get out of it, and the ...
12
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2answers
2k views

Where did all this deficit come from?

Back in 2008, the deficit was somewhere around $200 billion, until the bank bailout, which was reported at first to be a 1-time bailout of $800 billion. The next year, there was the Stimulus package, ...
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4answers
4k views

What are the stated downsides of allowing to default on college loan debt?

There are political positions in USA who advocate that people should be able to default on college loan debt (with the status quo being that it's very hard if not impossible to do so right now). What ...
16
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2answers
2k views

How do Democrats “gain leverage” by a three month debt limit increase?

I'm trying to understand some of the comments in the press that Democrats have gained leverage by the three-month extension tied to hurricane relief. This is what I don't understand - it seems to me ...
2
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0answers
326 views

If the US decided to inflate its way out of their debt, what would the value of the dollar drop to? [closed]

Hypothetically, what would the value of the US dollar drop to if the US government decided it wanted to inflate its way out of their national debt all at once? Would it simply be: M2 money supply / ...
7
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2answers
918 views

Why did Japan not raise taxes instead of borrowing to avoid having such a large debt ratio?

According to this article, Japan reached an enormous debt/GDP ratio of about 250%. The first two answers from here illustrate more about the structure of the debt. My highlights are: most ...
21
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1answer
6k views

When a government pays centuries old debt… who exactly is it paying?

I was watching the Extra Credits series on the South Sea Bubble. In there they say that the UK is still paying off the debt from the incident. However, given how old the debt is, I have to ask: who ...
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4answers
2k views

Implications of governments borrowing from a central bank rather than issuing money directly

Early in the history of the United States the political battle was fought between those who favored a strong central bank of the United States and others who felt the government reserved the right to ...
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4answers
2k views

What's the purpose for a country to maintain a large public debt?

Many countries keep a national debt over 50% of their GDP every year, including first world countries. They owe each other and also to banks, companies and households. As I understand, it wouldn't ...
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4answers
5k views

What are the overall aims of UK austerity, If the UK national debt has nearly doubled since it started?

The Opposition forced a vote for today on the end of austerity measures (not all) in regards to pay cap on public sector jobs. (The vote also includes pay rises for emergency services and the ...
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2answers
362 views

Is it true that the United States currently has no debt ceiling?

This article states that the debt ceiling was not raised in the deal enacted 2013-10-17, but rather that it was suspended allowing effectively unlimited borrowing until 2013-02-7. Is this accurate? ...
3
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2answers
271 views

If Congress refused to raise the debt ceiling, would it force the federal government to balance its expenditures/revenue?

The US continually increases the debit ceiling whenever it is reached. It has been raised over 30 times in the last 30 years. The debt ceiling as explained by the Government Accountability Office is: ...
1
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1answer
600 views

When will the US hit the debt ceiling again?

After the debt ceiling showdown of October 2013, the US debt ceiling (basically the total amount of outstanding debt the US is allowed to have at a time) was suspended from October 16, 2013 until ...