National debt is caused by a government not having enough revenue through taxes to cover its expenses. This debt is the national debt. National debt results from a government's expenditures exceeding that government's tax revenues. What basically causes it is political reluctance to raise taxes or cut spending since either move would be politically unpopular. Say no to plagiarism. Get a tailor-made essay on "Why Violent Video Games Shouldn't Be Banned"? Get Original Essay In the late 1980s, Tanzania was suffering from heavy external debt. Tanzania's external debt, which at the end of 1986 amounted to 3.9 billion US dollars and by 1992 had exceeded 6 billion. This occurred due to imprudent lending in the 1970s, inadequate economic policies, inaccurate assumptions about economic growth, collapse in commodity prices, a series of droughts, and a severe economic recession. This meant that the country had few ways to repay these debts due to their economic instability. This creates many problems for the country, for example. Some problems that occur as a result of national debt are reduced ability to respond to problems, as governments often borrow money to deal with unexpected occasions, such as wars, budget emergencies, and catastrophic events. events. This is moderately simple to do when demand is low. In any case, with a large and growing debt, the government has fewer choices available. For example, in the midst of the monetary emergency some time ago, when the debt was only 40% of GDP, the legislator could react by expanding spending and cutting spending in order to revive the economy. Be that as it may, debt subsequently increased to nearly double its share of GDP. If the debt were to remain at the current level of GDP or expand further, the government would think that it will be progressively difficult to adopt comparable agreements of the same level later, thus creating mistrust towards the country. Therefore, future recessions and money-related emergencies could have greater negative impacts on the economy and the prosperity of individuals. Furthermore, reduced financial adaptability and increased dependence on foreign investors that come with high and rising debt could debilitate the U.S. government globally. Given the potentially catastrophic impacts that could result from other disasters in the future, maintaining the United States' ability to respond quickly would be critical. But as debt continues to rise, reacting to this kind of thing will become more difficult in the future. In 2009, Greece's spending shortfall exceeded 15% of its total national output. The collapse of the Greek bond market would worsen Greece's ability to finance further debt payments. The EU and the International Monetary Fund have provided 240 billion euros in emergency funds in exchange for reducing the public budget deficit through spending cuts, tax increases or a combination of both. The loans gave Greece only enough money to pay the interest on its existing debt and keep the banks capitalized. The EU had no choice but to support its member by financing a bailout. Otherwise, it would face the consequences of Greece leaving the eurozone or defaulting. To a large extent, the reason for this circumstance was a political response from the Greek public who, having persevered despite the impacts of a terribly unforgiving seven-year period. military campaign, chose a left-wing government and.