The Problem Of Federal Government Debt In Obama 's

The debt problem is a huge economic problem embarrassing the United States, and it is also a significant political puzzle in the history of America. The public debts were formed in the beginning of18th century and increased rapidly in20th century. The debt problem worsened into a debt crisis in2011. Although the debt crisis was temporarily avoided, the debt problem remained fundamentally. In the future, the debt problem remains to be one of the most restrictive factors in the United States economy. Throughout American history, the occurrence of the debt problem is closely related to the domestic economic situation and major events which happened not only in the United States but also in the world. In recent years, the debt problem outbreaks and evolves into a crisis. On the one hand, after suffering from economic crisis, the economy in America cannot be recovered because of its inherent economic patterns. On the other hand, the political dilemma, triggered by economic problems, constrained the leadership to solve the debt problem. Especially in the situation of economic recession, the debt problem influences the economic recovery, endangers the U.S. dollar’s dominance in the world and threatens the use of diplomatic power of America. Given the economic size of America, international financial market will be also affected by the debt problem in the United States. In addition, the debt problem will also influence Sino-U.S. relations and China’s national interest since China holds more than1.5trillion American debt. In order to cope with the debt crisis, the Obama administration has adopted a series of measures, including cutting deficits and stimulating economy. At the same time, president Obama also tried to persuade external holders to hold the Treasury Bonds continually and put forward a proposal to promote export. In spite of the restrictive factors, the result of debt default will not appear which is based on the economic strength of America. Compared to European debts, the public debts in America are safe. As the biggest external holder, China should pay attention on America’s debt issue and try its best to protect its own benefit. China should also make use of the debt weapons to create a favorable external environment for its peaceful development in the premise of maintaining good relationship between China and the United States.