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Why is education spending one of the first areas the state legislature cuts when faced with...

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Economics

Why is education spending one of the first areas the statelegislature cuts when faced with a budget crisis? What are theeffects of cutting spending?

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Answer A budget deficit occurs when a government spending is greater than tax revenues This leads to an accumulation of public sector debt If the deficits are unsustainable this can cause rising bond yields higher interest payments and in the worse case lead to a loss of confidence in the government Though this is quite rare for countries with their own currency The obvious way to reduce a budget deficit is to increase tax rates and cut government spending However the difficulty is that    See Answer
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