Health And Social Care
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The chancellor says social care did an incredible job during the pandemic, but an ageing population is putting massive pressure on their services.
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Hunt says he wants to free up hospital beds by investing in social care, and will allocate £1bn more next year and £1.7bn a year after, funded by savings from delayed reforms.
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Patricia Hewitt, the former Labour health secretary, will advise the government on the efficiency of the NHS. Hunt says: We want Scandinavian quality alongside Singaporean efficiency.
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The chancellor says there will be a £3.3bn increase in NHS funding. That is a Conservative government putting the NHS first, he says.
Aubrey Allegretti: Hunt reminds MPs he is a former health secretary a role in which he was viewed as unpopular.
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He seeks to grasp one of the big issues facing the NHS, saying a plan will be drawn up for the number of doctors and nurses needed up to 15 years into the future.
In a nod to the frustrations felt by many in the health service given looming strikes, Hunt says he will ensure there is better retention and productivity improvements.
Delaying the social care cap will disappoint those Tories loyal to Boris Johnson, who promised to fix the crisis in social care once and for all with a clear plan we have prepared over three years.
The Government Is Not Your Family
Government debt is often likened to personal debt to convey concern about its size. But a family can’t pay its debts in its own currency the way the U.S. government does, nor does one household’s spending play an outsized role in that of others around it. In contrast, government spending is large enough that increases or cuts generate considerable second-order effects.
The paradox of thrift shows how individual choices to save more can end up producing the opposite effect in the aggregate. No paradox is needed to explain why governments adopting fiscal austerity often cause deeper economic downturns, producing larger deficits and ultimately more debt.
Coronavirus And The National Debt
The U.S. government has taken efforts to offset the effects of worldwide health pandemic by borrowing money to invest in individuals, businesses, and state and local governments. Of these responses, the CARES Act has been the largest stimulus package in U.S. history. This stimulus package included $2.3 trillion towards relief for large corporations, small businesses, individuals, state and local governments, public health, and education. In order to pay for the relief fund, the government needed to expand its debt to do so, the government borrowed money from investors through the sales of U.S. government bonds.
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Raise The Debt Ceiling
One thing Democrats would like to do but probably, at this point, cannot is raise the debt ceiling.
Republicans, particularly in the House, plan to use the nations borrowing limit as a bargaining chip to force spending cuts next year. The current debt ceiling of $31.4 trillion will likely be reached in the coming weeks, which means raising it will be a major fight early in 2023.
How much more does the government spend than it takes in? This is from a CNN Business report Monday: For fiscal year 2023, which started in October, the government is running a deficit of $336 billion, which is $20 billion narrower than the comparable year-ago period.
Us National Debt To Gdp
Thegross domestic product of a country is a measurement of economic activity. This can be further defined as the value that goods and services of the United States holds. The debt of the country is how much the country has borrowed to fund its sectors and activities. Debt-to-GDP is a measure of what a country owes compared to what it produces, and is an indicator of how a country might be able to pay back its debt. If a country is able to continuously pay interest on its debt without refinancing or hampering with economic growth, it is considered stable. The higher the debt-to-GDP ratio, the more trouble a country will have paying off public debt to external lenders.
The U.S. debt-to-GDP ratio was110% in the first quarter of 2020. This number is the U.S. national debt divided by the nominal GDP. The nominal GDP is the economic production with the current prices of goods and services considered. According to theWorld Bank, a debt-to-GDP ratio that exceeds 77% can slow down economic growth. Some consequences of this include lower wages, increased inflation, and higher taxes.
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What Is Debt Held By The Public How Big Is It
Debt held by the public is all debt that the federal government owes to those outside of the federal government. It includes debt held by individuals, businesses, banks, insurance companies, state and local governments, pension funds, mutual funds, foreign governments, foreign businesses and individuals, and the U.S. Federal Reserve Bank. However, it does not include intragovernmental debt.
As of today, debt held by the public is $23.6 trillion, up from $17.4 trillion in February 2020 before the COVID-19 crisis necessitated massive short-term borrowing. We project debt held by the public will rise to about $36.2 trillion by the end of FY 2031. As a share of the economy, debt held by the public is currently around 98 percent of GDP and is projected to reach a record 107.5 percent of GDP by 2031.
Why Shareholders Look At Debt
Debt is an important factor in the capital structure of a company, and can help it attain growth. Debt usually has a relatively lower financing cost than equity, which makes it an attractive option for executives.
However, due to interest-payment obligations, cash-flow of a company can be impacted. Having financial leverage also allows companies to use additional capital for business operations, allowing equity owners to retain excess profit, generated by the debt capital.
Looking for stocks with low debt-to-equity ratios? Check out Benzinga Pro, a market research platform which provides investors with near-instantaneous access to dozens of stock metrics including debt-to-equity ratio. .
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How Did The Debt Get Where It Is Today
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The United States has run annual deficitsspending more than the Treasury collectsalmost every year since the nations founding. The period since World War II, during which the United States emerged as a global superpower, is a good starting point from which to examine modern debt levels. Defense spending during the war led to unprecedented borrowing, with the debt skyrocketing to more than 100 percent of gross domestic product in 1946.
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Does Trump Realize Hes Now Just The Dems Stooge
Americas national debt has surpassed $30 trillion for the first time in history, the Treasury Department said this week.
The federal government exceeded the troubling threshold following a wave of borrowing and spending during the COVID-19 pandemic.
The national debt has expanded by approximately $7 trillion since January 2020, weeks before the pandemic began, as the Trump and Biden administrations dispersed stimulus payments and took other measures to support the economy.
The $30 trillion debt is equivalent to $231,000 per US household and $90,000 per person, according to the Peter G. Peterson Foundation. If every US household paid $1,000 per month toward covering the debt, it would take 19 years to pay down the sum.
The staggering figure includes intragovernmental debt, or money the federal government owes to itself, such as through Social Security trust funds. It also includes debt held by public entities such as businesses, pension plans and insurance companies.
More than $7.7 trillion is owed to foreign creditors, with Japan, China and the United Kingdom topping the list.
The US government exceeded the $30 trillion threshold much faster than expected. In 2020, the nonpartisan Congressional Budget Office predicted it would not occur until 2025.
In December, moderate Sen. Joe Manchin , a key holdout, cited the federal governments staggering debt as a key factor in his decision to oppose the legislation.
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What Is Intragovernmental Debt How Big Is It
Intragovernmental debt is debt that one part of the government owes to another part. In almost all cases, it is debt held in government trust funds, such as the Social Security trust funds. These debts represent assets to the part of the federal government that owns it , but a liability to the part of the government that issues them , and so they have no net effect on the government’s overall finances.
As of today, intragovernmental debt totals $6.5 trillion, up from $4.8 trillion a decade ago. However, it is projected to fall to $5.1 trillion by the end of FY 2031, as some major trust funds will soon be forced to begin selling off the debt they hold in order to continue covering their expenses.
How Do Current Debt Levels Compare Historically
Both gross and public debt are at all-time highs in nominal dollars, which is perhaps not surprising since the federal government has been running deficits for each of the past 20 fiscal years. As a percent of GDP, both are high by historical standards. Debt held by the public is currently around 98 percent of GDP, which is higher than any time in history other than in fiscal years 1945, 1946, and 2020, when unprecedented borrowing occurred to finance the World War II effort and to fight COVID-19. Even during those two periods, the record for debt was 106 percent of GDP in 1946 and 100 percent in 2020, both of which the federal government will surpass by 2031.
Gross debt currently amounts to 125 percent of GDP, which is the second-highest total in history, just short of the all-time record of 128 percent of GDP in 2020. By 2031, public debt will be at its highest level in history as a share of GDP, while gross debt will be slightly below todays level.
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Biden Administration Kicks Off Student Loan Debt Forgiveness Process Before Application Window Opens
In August, President Biden announced his decision to cancel up to $10,000 in student loan debt for individuals making less than $125,000 a year
The Biden administration on Thursday is kicking off its efforts toward forgiving student loan debt, sending updates on the process via email before the window to apply opens next month.
In August, President Joe Biden announced his decision to cancel up to $10,000 in student loan debt for individuals making less than $125,000 a year or as much as $20,000 for eligible borrowers who are also Pell Grant recipients.
An email from the Department of Education sent to Americans who signed up for updates and obtained by CNN Thursday offered some details on who is eligible and what to expect in the process.
In October, the US Department of Education will launch a short online application for student debt relief. You wont need to upload any supporting documents or use your FSA ID to submit your application, the email said.
It continued, Once you submit your application, well review it, determine your eligibility for debt relief and work with your loan servicer to process your relief. Well contact you if we need any additional information from you.
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The Politics Of National Debt
Disagreements about national debt have repeatedly preoccupied U.S. Congress. Whenever the national debt approaches the limit periodically reset by Congress, lawmakers are faced with a choice of raising the ceiling once again or letting the U.S. government default on its obligations, risking dire economic consequences. The U.S. government briefly shut down before Congress raised the limit in 2013. A similar standoff two years earlier led Standard & Poors to downgrade its U.S. credit rating.
In 2021, Congress narrowly averted a scheduled Oct. 1 government shutdown by passing a short-term funding bill, then raised the U.S. debt ceiling by $2.5 trillion to $31.4 trillion in December. That limit was expected to be reached in early 2023.
Americans profess to be concerned about the national debt in poll after poll, while also overwhelmingly supporting defense spending and outlays for Social Security and Medicare, and opposing tax increases.
As a result, elected officials too have been eager to be seen to be addressing the national debt, usually without linking it to the spending the debt enables or to the tax increases that a balanced budget would require.
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Current Foreign Ownership Of Us Debt
Japan owned $1.32 trillion in U.S. Treasurys in July 2021, making it the largest foreign holder of the national debt. The second-largest holder is China, which owns $1.07 trillion of U.S. debt. Both Japan and China want to keep the value of the dollar higher than the value of their own currencies. This helps to keep their exports to the U.S. affordable, which helps their economies grow.
China replaced the U.K. as the second-largest foreign holder in 2006 when it increased its holdings to $699 billion.
The U.K. is the third-largest holder with $579.8 billion. Its holdings have increased in rank as Brexit continues to weaken its economy. Ireland is next, holding $324.3 billion. Luxembourg, Switzerland, Cayman Islands, Brazil, Taiwan, and France round out the top 10.
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What Is The Composition Of Intragovernmental Debt
Most of the $6.5 trillion of intragovernmental debt is held in government trust funds. About $2.8 trillion is held in the Social Security Old Age and Survivors Insurance trust fund in the form of special issue securities that are expected to be redeemed within the next 15 years or so. A majority of the remaining amount comes from federal civilian and military retirement trust funds, which are projected to continue accumulating assets in order to notionally fund future retirement costs. Smaller amounts come from the Department of Defenses Medicare Eligible Retiree Fund, Medicare’s Hospital Insurance and Supplemental Medical Insurance trust funds, the Highway Trust Fund, the Deposit Insurance Fund, and the Social Security Disability Insurance trust fund, among other sources.
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How Do Budgetary Changes Affect Debt
Since public and gross debt are different measures of debt, changes to the federal budget can affect each measure differently. Any change to the unified federal budget that affects deficits will affect debt held by the public as well for example, a law that reduces ten-year deficits by $50 billion will generally reduce public debt by $50 billion. The same is not necessarily true of gross debt since any change that affects a program with a trust fund would have offsetting effects on gross debt. For example, a policy change that increases Social Security’s trust fund by $50 billion would reduce debt held by the public by a similar amount, but increase intragovernmental debt by $50 billion and therefore have little or no impact on gross federal debt.
Average Debt To Income Ratios
Debt to income ratio is a key indicator of financial health. Its determined by taking you monthly expenditures and dividing that number by your monthly income.
For instance, if your bills amount to $5,000 a month and you make $7,500 a month, your DTI is 66%. It also means you are dire need of financial overhaul.
The maximum DTI you can have to qualify for a mortgage is usually 43%. Most financial advisors recommend keeping your DTI at 30% or lower.
Overall, DTIs have risen over the years. A 2018 Federal Reserve report showed a slow but steady rise from 1980s, then a sharp increase during the housing boom of the early 2000s.
It dropped with financial crisis of 2008, which indicated many households cut consumption or defaulted on loans.
The median household income hit $79,900 in the first quarter of 2021, according to the U.S. Department of Housing and Urban Development. Thats almost $35,000 more than it was in 2000.
But the typical American household now carries an average debt of $145,000. The median debt was only $50,971 in 2000.
Year-to-year DTI statistics are hard to come by, but given the rise of debt versus the rise in income, its apparent that Americans in all demographic groups have higher debt-to-income ratios.
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What Is The Gross Federal Debt How Big Is It
The gross federal debt is the sum of virtually all debt the federal government owes, including what it owes to itself. Specifically, gross federal debt is the sum of debt held by the public and intragovernmental debt.
As of today, the gross debt is $30.0 trillion, up from $23.5 trillion in February 2020 before the COVID-19 public health and economic crisis necessitated massive short-term borrowing. The Congressional Budget Office projects gross debt to rise to roughly $41.0 trillion by the end of Fiscal Year 2031. As a share of the economy, gross debt is currently around 125 percent of GDP and is expected to fall to 122 percent of GDP by 2031.
The National Debt Dilemma
- The pandemic has taken the U.S. national debt to levels not seen since the 1940s.
- The United States is in a unique position because it holds the worlds reserve currency, allowing it to carry debt more cheaply than other countries.
- Some experts argue that the United States can safely continue to sustain high levels of debt, while others warn that it will eventually have to face the consequences.
The U.S. national debt is once again raising alarm bells. The massive spending in response to the COVID-19 pandemic has taken the budget deficit to levels not seen since World War II. This expansion follows years of ballooning debttotaling nearly $17 trillion in 2019that will now be even more difficult to reduce. Raising the debt ceiling, the legal limit on government borrowing, has become a perennial fight in Congress.
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