Economic Policy and the National Debt

Ironically, when governments overspend they typically find ways to refund or restructure debt -- when individuals or corporations within those countries do the same, the consequences are quite different. Money means more than one thing -- usually an object that is traded for payment of goods or services, of exchange. However, when we talk about the government, there is a huge different in the way the money supply works within the economy. In modern capitalism, commodity money (gold and silver) was replaced by representative wealth in that currency is no longer tied to the stores of precious metals. Instead, monetary policy under the Federal Reserve states that the goal of fiscal policy is to "promote effectively the goals of maximum employment, stable prices, and moderate long-term interest rates" (U.S. Mint, 2011).

As individuals, we typically live within a budget based on our expenses and...
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