Depending on which programs get cut employers will not be creating any more jobs and unemployment will continue to rise. Spending cuts over the next decade will effect the weaking economy.
What areas could see less money?
So far there has been mention of military cuts, but the biggest cuts will come down the line to federal programs which include highway construction, housing assistance and government sponsored research.
Defense departments will feel the squeeze as more economist discuss how cutting too deep will make it harder to see a economic recovery.
The federal deficit is estimated to be cut by trillions of dollars. It looks as another recession is ahead for Americans who are already feeling the loss of jobs and housing.
Will Treasury Bonds be a Safe Haven?
The long term interest rate of the 10- year treasury note has analyst anticipating a relief over the debt ceiling deal. Businesses spending more cash is unlikely considering the employment data showing a decline in new jobs being added.
Fiscal Spending Reductions
The global economy from Europe, China and Japan is showing a slowing down for fear of inflation. If we look at the breakdown of government spending in the U.S. we notice a pattern.
Programs that are effected the most are: Pensions, Healthcare, Education, National Defense, and Welfare. How much will be cut has not been determined.
What about Social Security, Medicare and Medicaid ?
It has been a long debate as to how much money is going to be available for future generations when it comes to Social Security benefits which is a insurance program funded through payroll taxes known as the Federal Insurance Contributions Act tax.
As for Medicare it is a U.S. program that provides health insurance coverage to people who are aged 65 and over. This also includes those who are under 65 and are disabled or have a physical disability.
Despite a unfavorable heathcare system Medicaid is a U.S. health program for low income adults, families and their children, as well as those with disabilities.
As long as the United States public debt is a measured by the obligations of the United States federal government and is presented by the United States Treasury the people will receive federal budget cuts in programs that matter most.