Budget Deficit

A budget deficit is when you are spending more than you are taking in as income. When a government incurs a budget deficit, its spending programs are more than the revenue that it takes in from taxes, fees and tariffs. If the government’s income is greater than its spending, then it is said to be running a budget surplus. When a government incurs several years of budget deficits, it then builds a debt, which is the accumulation of the deficits. The total budget deficit is made up of two parts: structural and cyclical. A cyclical deficit stems from the economy. As the economic performance varies, the tax revenues and social-spending programs are adjusted to the cyclical pulse of the economy. A structural deficit stems from the amount of spending in excess of the cyclical portion, after the cyclical portion is paid off.


For the U.S. government’s fiscal year ended September 30, 2014, the government registered a budget deficit of $483 billion—the lowest budget deficit since 2007. In fiscal 2013, the budget deficit was $680 billion. In each of the previous four fiscal…

For the U.S. federal government’s fiscal year, which ends this Tuesday, the Congressional Budget Office (CBO) predicts a budget deficit of $506 billion. (Source: Congressional Budget Office web site, September 26, 2014.) But just because our annual deficit is declining,…

According to the U.S. Congressional Budget Office, next year, the government is expected to incur a budget deficit of $469 billion and then another budget deficit of $536 billion in 2016. (Source: Congressional Budget Office web site, last accessed July…

As it stands, the U.S. national debt has skyrocketed to above $17.4 trillion. With this year’s budget deficit expected to be around $500 billion, we’ll be at a national debt of $18.0 trillion in no time. In fact, a $30.0-trillion…

Something just doesn’t make sense here… In 2013, the U.S. budget deficit came down to $680 billion. Finally, after four consecutive years of annual budget deficits of more than $1.0 trillion, the government got its annual “hole” under the trillion-dollar…

Detroit, the “Motor City,” has been approved for bankruptcy. In making the ruling, Judge Steven W. Rhodes, who sits in the United States Bankruptcy Court for the Eastern District of Michigan, said, “This once proud and prosperous city can’t pay…

It was a regular flight for me to Miami…a late Saturday afternoon two weeks ago. As our flight approached Miami International Airport, the captain announced we would soon be starting our descent. Then something happened that I thought was strange.…

I’m blessed to be able to travel to Europe once or twice a year. I use the trips as an opportunity to see how the economies are faring over there. And I can tell you this first-hand: the economic situation…

The mainstream and politicians tell us the “wounds” of the financial crisis are over and the U.S. economy is in recovery mode. This simply isn’t true. A few of the key indicators I follow to see where an economy stands…

We have seen cities like Detroit and others in California tell their municipal bonds investors, “Sorry, we can’t pay you.” The reason behind this? Their budget deficit was out of control, they reached the breaking point, and they filed for…

Can it be true? The U.S. Department of the Treasury has reported that for the federal government’s fiscal 2013 year, which ended on September 30, 2013, the U.S. government budget deficit was $680 billion—the smallest budget deficit in five years.…

The “Bernie” Madoff name became famous while the stock market was falling during the credit and financial crisis. He was responsible for running one of the biggest Ponzi schemes in U.S. history—if I recall correctly, it was a $65.0-billion scheme.…