I pledge allegiance to the flag of the United States of America and to the Republic for which it stands, one nation under God, indivisible, with liberty and justice for all.
This page will provide a description of economics of the federal government.
It is the function of the frderal government to provide services to its citizens. In providing these services, the federal government incurs expenses. These services include providing for national security, general governance (federal laws and enforcement) and many other services. The expenses incurred in providing these services include supporting a standing military, lawmakers, and on and on…The funds to cover these expenses come from federal taxes. If the federal government collects more taxes (income) than it needs in order to provide the required services, then the federal government has acquired a surplus. If the federal government incurs more expenses than it collects in taxes, then it has incurred a negative surplus or deficit. In order to continue providing these services it must raise taxes and or incur debt. Another option is to decrease the amount or quality of services in order to decrease expenses. If the federal government incurs debt, the interest expense and the principle (amount borrowed) payback is now an added expense against future tax collections.
surplus = (income tax collection) – (cost of providing services)
if
(cost of providing services)
is greater than
(income tax collection)
then
surplus is less than 0 (negative)
and
a deficit exists (they do not have funds to provide services);
therfore
the federal government must either
cease operation (stop providing services)
or
borrow money to continue operation (incur debt);
or
print (issue) more money (this dilutes the money supply making it worth less)
causing inflation (products and services are more expensive).
If more money is issued to cover the increased cost of products and services,
the money supply is diluted even more and inflayion begins to spiral out of control
and the entire economy collapses.
if
the operation is seen as not feasible
(building large debt in order to continue a continuing unsustainable operation)
then
it is possible no one will be willing to supply the loan
and
the local government must cease operation (stop providing services)
or
print more money (see above).
It is not acceptable for the federal government to cease operation.
In order to continue operation (providing services) the frderal government must either
cut expenses in providing services
(paying less for services may decrease their quality or reliability)
or
increase the income by increasing taxes
or
print (issue) more money.
Uncontrolled issuance more money is the least acceptable.
The citzens must decide it they want to continue expensive services and government spending
(and pay even higher taxes) or get control of government spending (reduce government expeses)
and possibly reduce taxes.
All Rights Reserved
Approved by The Committee to Elect Dale E Brown
PO Box 234, N Chelmsford, MA, 01863