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National debt, on the other hand, is the sum of all previously incurred annual federal deficits. Since the deficits are financed by government borrowing, national debt is equal to all government debt outstanding.
Whenever the U.S. has a deficit year, money is borrowed to pay for the deficit. Deficits are not a new concept as far as our nation’s history is concerned. Deficits were incurred during and after WWI. Then the country enjoyed a decade of annual budget surpluses until the Great Depression; and WWII only made it worse. The country never quite returned to the concept of living within its means since that time...
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Common topics in this essay:
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