Economy of the United States

The Economy of the United States is the largest and one of the most technologically advanced national economies in the world, with a per capita GDP of $40,100. In this capitalist, market-oriented economy, private individuals and business firms make most of the decisions, and the federal and state governments buy needed goods and services predominantly in the private marketplace with taxes collected from firms and individuals. Business firms in the U.S. enjoy considerably less regulation than firms in many other states concerning decisions to expand capital plant, lay off workers, and develop new products, but there is a debate about how much relative regulation exists in the United States in the era of globalization. American firms are at or near the forefront in technological research and development, especially in computers, pharmaceuticals, and aerospace, although some advantages have narrowed since the end of World War II. The United States has transformed from being the world's largest creditor to having substantial fiscal and trade deficits; the significance of these deficits is disputed by economists.

National debt

The national debt, more properly known as the federal debt, is one of the most controversial issues in the United States. It is usually expressed as an absolute number, but a more accurate measurement is the ratio of the debt to gross domestic product. Most citizens favor paying off the national debt, though a minority feel this could have negative economic consequences.

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The borrowing cap debt ceiling as of 2004 stood at 8.2 trillion. At the current rate of growing indebtedness, this level will be reached sometime in 2005. It is expected that Senate will approve further increase of the cap, sometime before the ceiling is reached.

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The size of the debt is in the trillions and consequently it has been part of popular culture to parody the growing debt with some type of doomsday clock, graphically showing the growing indebtedness every second.

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Whilst it is true that the national debt is the largest in the world, and growing larger every second, it is also true that the economy as a whole is also the largest in the world and growing every second.

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As a result, the ratio of debt to GDP compares quite favorably to say, Japan.

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Modern presidential records

Statistics here are given in both in raw numbers and in relation to the debt ratio, an expression of the federal debt as a percentage of GDP. Due to World War II, the national debt spiked to a historical peak of 121.2% of GDP in 1946.

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