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It happens quite usually that national politicians can regularly speak of limiting Social Security and Medicare in some ways. However, when confronted with enough public scrutiny in general, those politicians who advocate such reductions become less strident in their own comments. Taxes from the Federal Insurance Contributions Act (FICA) provides revenue for the Social Security and Medicare programs. The amount of gathered tax revenue is partially dependent on the payroll FICA tax cap. This article explains how the cap works. Social Security started in 1935, as part of the New Deal. In 1956, insurance to aid disabled people was started. In this article, different aspects of that cap are also examined. In 1965, the Medicare program came into effect. Any temporary surplus of federal funds must be used to hold US Treasury Securities. Starting in Fiscal Year 1969, the United States of America have operated under the law of the Unified Budget Act. This act stipulates that all receipts and outlays of all federal spending be consolidated into a unified budget. Much of these funds will be needed as future retirees receive benefits from the Social Security and Medicare. As that happens, there may be comparatively less US Treasury securities held by the Social Security and Medicare Trust funds. This article shows some of the concerns that the President and Congress face in budget negotiations. In 2017, the rating for long-term US Treasury Securities stayed at AA+ by Standard and Poor’s, a credit rating firm. Both Congress and the US President needed to work together to slow the growth of annual deficits, which adds to the federal debt. Interestingly, two other bond rating firms, Moody’s Investors and Fitch, maintained the bond rating of AAA. It has to be remembered that none of these ratings are permanent. As time goes on, firms that give bonds ratings will keep on analysing those who issues securities, including the US government. Furthermore, not all credit rating agencies agreed with any fall of the credit rating. As to a more recent credit rating, US Treasuries were rated at AAA. The reader should always be cognizant of the fact that ratings can change over time. Such times as occurred in May 2023 (debt ceilings, tax revenues and spending disagreements between the legislative and executive branches) may or may not be contemplated regarding the credit rating of US Treasuries.

Los portafolios de deuda mal estructurados, ya sea en términos de vencimientos, monedas o tasas de interés, y los elevados niveles de pasivos contingentes, han sido factores importantes que han inducido o propagado las crisis económicas en muchos países a lo largo de la historia (FMI, 2020, p.111). El Ministerio de Hacienda (MH) no hace una optimización completa con función objetivo (apetito por riesgos) al estimar la estrategia por lo que existe un vacío técnico de información que lleva a sesgos de selección en la estrategia, siendo que los riesgos no cuantificados pueden llevar a vulnerabilidades. La gestión de la deuda se define “como las operaciones de mercado llevadas a cabo por el gobierno con el objetivo de cambiar la composición del saldo de la deuda emitida” (Paalzow, 1992, p.8). Y atendiendo al Fondo Monetario Internacional (2014), el objetivo de la gestión de la deuda es: “asegurar las fuentes de financiamiento para las necesidades del gobierno y el cumplimiento de sus obligaciones de pago al menor costo posible en el mediano a largo plazo y en forma compatible con un nivel prudente de riesgo” (p.21). De la investigación se logran identificar vulnerabilidades en la deuda, por lo que el MH deberá renegociar las condiciones de plazo y la tasa en el mercado bajo una coyuntura macroeconómica menos favorable para el emisor, y también las composiciones del portafolio de deuda, ya que la exposición a los riesgos del portafolio ha aumentado. Asimismo, producto de la investigación se logró calibrar una función de apetito al riesgo mediante la definición de los riesgos relevantes de la deuda, a partir de mejores prácticas internacionales para la elaboración de estrategias de endeudamiento de mediano plazo. Mediante las simulaciones se logró estimar la estrategia de colocación de mediano plazo que, con respecto al apetito al riesgo, logra optimizar las métricas. La estrategia es: para instrumentos de cero cupones en 8%, para instrumentos tasa fija en 45%, en títulos tasa variable 13%, y 16% en instrumentos indexados. Se estimó que la posición en moneda extranjera debe ser 39% (superior a la Estrategia del MH). Como parte del ejercicio se logró determinar que la Estrategia del MH publicada para el 2022 no es consistente con el apetito al riesgo, y se infiere que el principal problema de la estrategia del MH es su corta duración. Poorly structured debt portfolios, whether in terms of maturities, currencies or interest rates, and high levels of contingent liabilities have been important factors that have induced or propagated economic crises in many countries throughout history (IMF, 2020, p.111). The Ministry of Finance (MoF) does not make a complete optimization with an objective function (Appetite for risks), there is a technical information gap, and this leads to selection bias in the Strategy, unidentified risks can lead to vulnerabilities. Public debt management is defined as “operations made by the government on the financial markets in order to change the composition of the outstanding public debt” (Paalzow, 1992, p.8). According to the International Monetary Fund (2014), the objective of debt management is "(…) to raise the required amount of funding at the lowest possible cost over the medium to long run, consistent with a prudent degree of risk.” (p.21). From the investigation it was possible to identify vulnerabilities, namely, that the MoF will have to renegotiate the term conditions of the debt in the market, under a less favorable macroeconomic situation for the issuer and the exposure to the risks of the portfolio has been increased. As a result of the research, it was possible to calibrate a risk appetite function by defining the relevant risks of the debt, based on the best international practices for the development of medium-term debt strategies. Throughout the simulations, we estimate that the medium-term strategy, with respect to risk appetite, manages to optimize the metrics. The strategy is: for zero coupon instruments at 8%, for fixed rate instruments at 45%, for variable rate securities 13%, and 16% for indexed instruments. It was estimated that the foreign currency position should be 39%, higher than the MoF Strategy proposed. As part of the results, it was determined that the Ministry of Finance Strategy published for 2022 is not consistent with risk appetite, and it is inferred that the main problem with the Ministry of Finance Strategy is its short duration. Universidad Nacional, Costa Rica. Centro Internacional de Política Económica Para el Desarrollo Sostenible

This study examined the impact of Nigeria’s huge national debt and the cost of governance on her GDP using some macroeconomic indices as proxies for the period 1999 – 2021. The specific objectives are to investigate the impact of debt servicing costs on GDP in Nigeria for the period, 1999 – 2021and to examine the impact of cost of governance on GDP in Nigeria within the same period. In this study, we reviewed the theoretical and empirical literature in order to understand all the issues, challenges and consequences of maintaining such huge national debt portfolio in the face of our burgeoning cost of governance on our deteriorating GDP since the commencement of this democratic dispensation in 1999. We used ex-post facto type of research design to gather all the relevant data from the Debt Management Office(DMO), National Bureau of Statistics (NBS) and Central Bank of Nigeria (CBN) websites and adopted the ADF econometric model to address the unit root issues associated with time series econometric data gathering and then deployed the dynamic ARDL regression model to regress the dependent variable (Gross Domestic Product (GDP)), on the two independent variables (debt servicing costs (DSC) and cost of governance (COG)) which were used as proxies for measuring their impact on the GDP of Nigeria. Furthermore, we used the Ramsey regression error specification model to determine whether there is a functional form misspecification in the ARDL model used and found that the model was correctly specified. From our study, we found that while debt servicing costs had a negative and less significance impact on the GDP, cost of governance had a positive and significant impact on the GDP over the period of study. Based on this finding, we recommended several governance costs cutting measures, among other alternative debt financing options and suggested appropriate remediation policies for government to tackle this monstrous twin evil of a burgeoning debt servicing cost and cost of governance in Nigeria.

Purpose- East African countries are the fastest-growing nations in the region. These countries have membership in several well-known regional agreements such as COMESA, IGAD, and EAC. Hence, because of their impressive growth in the course of the previous years, these countries are demanding an extensive analysis from many dimensions. Consequently, this paper has an objective to inspect the national debt of 9 selected East African countries from the period 2000 to 2021. Methodology- The paper utilized longitudinal panel data in order to evaluate the impact that the GDP, inflation rate, government spending, and trade have on the national debt of east African countries. Findings- The findings in our fixed effect model revealed that the variables GDP, inflation rate, government spending, importation, and exportation have a significant impact on the national debt of East African countries. we perceive that an increase of 1% in GDP increases 0.557% in the East African debt. Also, the inflation rate and government spending revealed that they expand by 0.002% and 0.413% respectively the national debt of East African debt. Finally, according to table 3, the trade components have revealed distinctive effects. To start with, exportation was revealed to increase the national debt by 0.122% while importation revealed an inverse impact in which it reduces the national debt by -0.368%. Conclusion- Finally, the study will provide evidence to the African countries especially my country Djibouti how to adjust and limit their national debt in conformity with their gross domestic product and economic capacity. Additionally, it will provide economists with a better comprehension of the economic situation in East Africa.

Der Koalitionsvertrag der Ampel befleißigt sich des kreativen Budgetierens. Umwegfinanzierungen über Nebenhaushalte, Sondervermögen und Schattenhaushalte vermeiden die parlamentarische Kontrolle des Haushalts und die Restriktionen der Schuldenbremse. Wenn in Zukunft beispielsweise die Bahn oder die öffentlich-rechtliche Bundesanstalt für Immobilienaufgaben sich Milliarden am Finanzmarkt leihen, ist das nicht haushaltswirksam. So können aber wohnungspolitische oder verkehrspolitische Ziele erreicht werden. Kreatives Budgetieren gehört zum täglichen Brot von Regierungen, paradoxerweise insbesondere dann, wenn die Politik dem kreativen Budgetieren durch Haushaltsregeln abgeschworen hat. Dass Politik und Verwaltung Haushaltstricks beherrschen, ist keine Tugend, die Applaus verdient – auch wenn manche gerade darin kluge Politik erkennen wollen.

Egyptian President Abdel Fatah al-Sisi has consolidated his authoritarian regime in recent years. This has been accompanied by a significant increase in Cairo's foreign debt, which more than tripled between June 2013 and March 2022. The country's debt policy was directly linked to the presidential centre of power. The government managed a well-choreographed mix of incentives, threats, and concealment that made it possible to take out more and more new loans. The Egyptian military, on whose support President Sisi is dependent in order to assert his claim to power, is the main beneficiary of the debt policy. External debt helped to protect the revenues and assets of the armed forces, to finance major projects in which they could earn significant money, and to pursue an expansive military build-up. The instrumentalisation of debt policy for power politics increases the risk that Egypt will no longer be able to service its liabilities in the future. Above all, however, the misallocation of scarce financial resources under­mines the socio-economic development of the country and promotes police-state repression. The latter, in turn, favours the political instrumentalisation of debt policy for power politics, as it prevents any control of govern­ment action. In the future, Germany and its European partners should therefore tie bi­lateral lending as well as support for Egypt in its negotiations with international financial institutions to two conditions: firstly, the dismantling of military economic activities - whereby the assets of the armed forces must also be disclosed - and secondly, concrete steps towards ending police-state repression. (author's abstract)

In 2009, just before the full outbreak of the global financial crisis, Olivier Blanchard (2009) published an article giving a favourable appraisal of the state of macroeconomics. He came to this verdict on the basis that, after a long period of fierce theoretical debate, the discipline had converged on a model known as new consensus macroeconomics (NCM). In the models that made up NCM, fiscal policy played no role - or, to be more precise, fiscal policy had to follow a balanced-budget rule, with the task of stabilising an economy over the business cycle entrusted entirely to monetary policy (following a Taylor rule). And in the midst of the global financial crisis, Carmen Reinhart and Kenneth Rogoff (2010) proposed the figure of 90% of GDP as a threshold level for public debt which, if exceeded, would harm economic growth, leaving fiscal austerity as the best way to trigger economic recovery. Only a decade later, the economics profession now appears to have taken a very different view on fiscal policy: in order to cope with the next economic crisis, resulting from the coronavirus pandemic, most economists recommend an active fiscal policy stance and even a huge increase in debt-to-GDP levels. This paper will shed some light on these developments in economic policymaking and explore the future of fiscal policy.

Der ägyptische Präsident Abdel Fatah al-Sisi hat seine autoritäre Herrschaft in den vergangenen Jahren konsolidiert. Dies ging einher mit einem deutlichen Anstieg von Kairos Auslandsverschuldung, die sich - gemessen am Bruttoinlandsprodukt - zwischen 2013 und 2021 nahezu verdreifacht hat. Die Schuldenpolitik des Landes war direkt an das präsidiale Macht­zentrum angebunden. Der Regierung gelang ein gut choreographierter Mix aus Anreizen, Drohungen und Täuschung, der es ermöglichte, immer neue Kredite aufzunehmen und für machtpolitische Zwecke einzusetzen. Profitiert hat von der Schuldenpolitik zuvorderst das ägyptische Militär, auf dessen Unterstützung Präsident Sisi angewiesen ist, um seinen Herrschaftsanspruch durchsetzen zu können. Die Streitkräfte haben das staat­liche Gewaltmonopol inne und kontrollieren damit auch den Repres­sionsapparat. Durch die machtpolitische Instrumentalisierung der Schuldenpolitik steigt das Risiko, dass Ägypten seine Verbindlichkeiten zukünftig nicht mehr bedienen kann. Vor allem aber unterminiert die Fehlallokation knapper Finanzmittel die sozioökonomische Entwicklung des Landes und befördert polizeistaat­liche Repression. Letztere begünstigt ihrerseits die machtpolitische Instru­mentalisierung der Schuldenpolitik, da sie jegliche Kontrolle des Regierungshandelns verhindert. Die Bundesregierung sollte daher künftig die bilaterale Kreditvergabe und die Unterstützung Ägyptens bei dessen Verhandlungen mit inter­nationalen Finanzinstitutionen an zwei Bedingungen knüpfen: erstens den Rückbau der militärischen Wirtschaftsaktivitäten - wobei auch die Ver­mögenswerte der Streitkräfte offenzulegen sind - und zweitens konkrete Schritte zur Beendigung der polizeistaatlichen Repression. (Autorenreferat)