Final answer:
The statement regarding house funds being used as lending funds is false. Governmental funds are typically used for services and programs, including national defense, and not for lending. Regulatory changes may impact banking practices, but they do not allocate government money for lending.
Step-by-step explanation:
The statement that house funds shall be used as lending funds is false. In the context of U.S. government financing, house funds typically refer to the funds that the federal government has at its disposal, which are not specifically designated as lending funds. As delineated in Section 8 Clause 2 of the U.S. Constitution, Congress has the power to borrow money, but this is generally done to pay for governmental services and programs, which can include supporting national defense, rather than acting as a lending body. Additionally, federal funds can also be used to pay down the national debt or refunded to taxpayers.
It is important to note that when the federal government changes bank regulations to make it cheaper and easier for banks to make home loans, this does not mean those funds come directly from the 'house' or governmental funds. Such regulatory changes are designed to influence the behavior of private banks and financial institutions, not to allocate government money for lending purposes.
Moreover, the concept that as debt increases, interest payments rise, and the deficit grows even if other government spending remains constant, is critical to understanding the complexity of government financing and borrowing but does not implicate direct lending by the government.