Summary: The US Budget Deficit

Deficit spending refers to government spending that exceeds federal income and taxes over a period of time. The government can increase borrowing to obtain money from taxes or from foreign governments. The money that is borrowed is then put back into the economy through government spending. While deficit spending will increase government debt, it is believed to stimulate the economy to end a recession. Deficit spending has several advantages and disadvantages to government borrowing.

Overspending is a pertinent problem facing the lawmakers in Congress. In 2012 discretionary spending reached $1.3 trillion and mandatory spending $2 trillion, while only bringing in $2.5 trillion in revenue. Since the turn of the century back in 2000, non-mandatory spending by the government has topped out a whopping $16.1 trillion just in the past 13 years (Boccia, Frasser & Goff 2013). This persistent overspending on programs and services that are not necessary to the functionality of the country is what is causing the deficit to rise year after year. To remedy this issue the government must either increase the revenue it brings in through taxes and trade or reduce the amount of money it spend or perhaps even both. In 2012 thirty-one cents of every dollar that Washington spent was borrowed (Boccia, Frasser & Goff 2013). Most of which went to large programs such as Social Security and Medicare and if these large, growing programs, or just the budget in general, do not undergo financial reform it could spell disaster for the economy and fiscal state of the nation.

Education in America is one of the most important issues that face our nation. If the education in America is not thought of one of most serious issues we face, our nation as a whole will fall. There are many debates and they seemly extend to all walks of life. The debates range from the decline in education, school vouchers, and the no child left behind law. As a nation, the United States is ranked above others. We must search for that solution to all of the pro’s and con’s in education. The solution should allow all walks of life to excel in the education realm. After all, the children of today will be the leaders of tomorrow.

The federal budget deficit is a much discussed and little understood subject in American politics. The current recession has dramatically decreased tax revenues, driving the United States federal government to increase spending in an attempt to stabilize the economy. As a result the current federal deficit is at over $1.3 trillion dollars. This is approximately $47,754 per U.S. citizen or $137,552 per U. S. taxpayer (U.S. Debt Clock: Real Time, 2012).

When World War II ended in 1949, the debt grew at a slow and steady pace for the next 20 years. When the Vietnam War began in the 1960's the debt accelerated sharply. Thanks to the growth of television and news media, growth of the deficit was widely publicized. For the first time, the American people were given access to what was going on with the nation's debt. When the Gulf War began the early 1990's, the national debt reached a trillion dollars for the first time. By the end of the Gulf War, the government decided to make amendments to fix the continuing problem with the deficit. Despite those promises to reduce spending, the debt is currently at it highest point ever.

Federal debt has been increasing for at least the past ten years. Currently, federal debt is $19,929,184,161,352.13 (Chantrill). The national debt has nearly doubled throughout Obama’s presidency and President elect Trump’s ideas do not look promising for change. It is estimated that Trump’s tax cuts will raise federal debt by $7.2 trillion within the next decade (Mauro). Many debt crises have occurred because of declines in growth. When

The federal budget is known as the notorious economic tank from which money is distributed to various programs. The money used every fiscal year, which begins October 1st and ends September 30th the next year, belongs to the people. The government raises this money through taxes and they spend it on national defense, Medicare, and social security. The federal budget is an exercise in making choices, and those options will certainly affect individuals living in the U.S. These choices cause debt to pile up on the government, who is struggling to make it disappear. The deficit and debt of a government gauges how well it is being run and how well it has been run in the past. According to The Economist the national debt is the total

While the national debt continues to rise at a staggering amount, the federal deficit slowly rising. The deficit, to my understanding, is the difference between the amount of money the government is bringing in versus what it spends annually. The incline in the deficit can be credited to higher government spending and the end of the recession. Because the deficits are growing, they are causing the national debt to increase. Meaning that even though they are becoming smaller, they are

The historical federal spending of the government has already done significant damage to America; spending habits have increased the federal budget deficit at alarming rates adding $2.7 trillion to the national debt in two years, $1.4 trillion in the 2009 fiscal year and $1.3 trillion in 2010. (Montgomery)   These deficits are largely caused by increases in spending rates. The current Obama Administration has used the recession in their favor to expand both the government and spending.

How large is the current U.S. budget deficit and how has it changed over the last few years?

Based on the above Figure 1, the largest deficits always occurred during war. It was reasonable since the government spent significantly on weapons and logistics during these periods of time. Omitting periods of war and focusing on the most recent 32 years, there were only 4 budget surpluses from 1998 to 2011. Since then, there was nothing but deficits. The Congressional Budget Office (2016) expects deficits will occur every single year until 2026 under the current policies.

This paper will attempt to answer the question: Is the federal deficit and government deficits in general a good or a bad thing? While it may be easy to lose sight of how the government chooses to handle its money, it is also important for citizens to be conscious of how their money is being spent, and whether or not the current course that the government is plotted on is either sustainable or the best allocation of resources.

The United States has seen a growth in the deficit beginning in 1991. The deficit equated to 3.6% of the GDP in 1999 and rose to 4.4% during 2000. “For instance,

Throughout most of the country’s history, the United States’ federal government maintained a reasonable level of national debt. For example, the total national debt in 1981 was $998 billion. Since then, however, the government has generated significant budget deficits, and the level of debt has risen to $16.7 trillion in 2013 (Calleo, 39). Budget deficits are caused

Deficit spending is when purchases exceed income. It is usually attributed to government spending within an economy. Although it can happen to both individual and business, when government spends more and not able to balance the budget, we say it is deficit spending. Deficit spending is created each fiscal year by congress and government because the spending by government causes the growth of the economy. For example, in the United State deficit spending is mainly caused by social, security, and medical cost. Government spends most of its revenue in each fiscal year into this payment. According to Kimberly Amadeo(2017) he said “ most people don’t realize that wars create more deficit spending than the create recession. The war in Afghanistan cost $28.7 billion in 2001.The war in Iraq for deployed military costs $72.5 billion by 2003. In 2008, the total cost grew to $186.6 billion.