Should the United States consider a debt consolidation loan? There’s little doubt, after all, that the country has overwhelming debt. If the United States was a consumer or a business, it’d be filing for bankruptcy protection right about now. Ben Bernanke, the chairman of the U.S. Federal Reserve Board, expressed his own concerns about the United States’ growing levels of debt. Speaking before the House Budget Committee, Bernanke issued a warning that the federal budget is traveling along an unsustainable path. It’s hard to argue: The U.S. national debt soared past $13 trillion recently. Bernanke said that the United States has to rein in its spending.
Recent Spending Necessary?
At the same time, Bernanke defended last year’s $787 billion economic stimulus plan pushed by the Obama administration. Yes, this stimulus did add to the U.S. national debt in a significant way. But the stimulus was necessary, Bernanke said, to ease the pain of the Great Recession. It’s hard to argue against this, too. Consumers are still struggling with the impact of the worst recession in decades. The national unemployment rate is still near 10 percent, leaving far too many people either unemployed or underemployed. It’s debatable what impact the stimulus plan had. Supporters of the measure, though, said that it provided a significant number of jobs while bringing new road-construction and other projects to states. Supporters say that the Great Recession would have been even longer and more painful without the stimulus dollars. Critics take the other side, saying that the stimulus dollars did nothing but boost the country’s deficit.
If The United States Was a Person
It’s interesting to sometimes imagine that the United States is a person. What would we think about this person’s financial maturity? For one thing, we’d probably recommend that the United States immediately begin tackling its debt. Because the country’s debt is so severe, though, it’d probably have to take drastic action. Declaring bankruptcy would be one option. So would taking out a debt consolidation loan. Both moves would lower the credit score of the country. Debt consolidation, though, would administer the lowest hit.
Consumers Problems Mirror the Country’s
Many consumers have a problem that is similar to the one that the United States is now suffering. They, too, have run up too much debt, whether because of a job loss or a reduction in their annual salaries. For those with the largest amounts of debt, debt consolidation loans might be the best solution. They will hurt consumers’ credit scores, and they do come with high interest rates. But they also relieve some of the stress that comes with an overwhelming amount of debt. Consumers, just like the United States, have to make some difficult decisions.