When nations go deep in debt, it’s one giant I.O.U.
If you owe too much money and can’t repay it, you could lose your car or home. Can a nation have too much debt? What happens then? Currencies from around the world. Getty Images. During the pandemic, businesses closed, people went into lockdown and governments...
Economic issues often confound students – and adults alike. The U.S. has hit its debt ceiling and Italy and Japan are dealing with massive amounts of national debt. But what does that mean and how does that differ from money a student’s family might owe – like a home mortgage or car loan? This month, Correspondent Tiziana Barghini decodes national debt, taking us through this complicated and timely topic.
Exercise: Give students a list of national budget expenses such as defense, food stamps, aid to public schools, road maintenance and construction, public safety etc., with percentages of the budget for each that add up to 92%. The other 8% will be interest payments on national debt. Then increase the percentage for the debt and have students try to get the overall number back to 100% by cutting spending elsewhere. As the payments on the debt go up, where will they find the money to pay it?