National Debt

National Debt

Introduction

While many economists argue that the government must incur budget deficits during economic downturns, critics of government spending assert that the U.S. national debt is already too high. Burdening the country with large debts that would eventually have to be repaid might have negative long-term consequences for the economy, they worry.

An entity including the U.S. government incurs a budget deficit when it spends more money than it makes. The government collects most of its revenue through taxes. When the U.S. budget requires more money than the government collects in taxes in a given fiscal year, the country must go ...