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 years, it was more than $1.0 trillion per annum. (Source: U.S. Department of the Treasury, October 15, 2014.)

On the surface, this is great news.

And logically, one would think, the lower the budget deficit, the slower the growth of the national debt. If the budget deficit comes in at $100 billion, for example, the government will have to borrow money to pay for its budget deficit gap and raise the national debt by $100 billion.

But in fiscal year 2014, this wasn’t the case.

On October 1, 2013, the U.S. national debt stood at $16.74 trillion and on October 1, 2014, the national debt sat at $17.87 trillion—an increase of $1.13 trillion. Over a 12-month period, our national debt grew by 2.3 times the amount the budget deficit grew! (Source: U.S. Treasury Direct web site, last accessed October 23, 2014.)

No one is really questioning the sudden increase in the national debt compared to the budget deficit. Personally, I haven’t come across any articles on major news channels or heard of any explanation from government agencies about this.

How can this be happening? How can the national debt be rising 2.3 times faster than the budget deficit over the same period of time?

Dear reader, something doesn’t jive here. Either the government’s operating budget excludes some expenses, or there’s a problem somewhere in the numbers.

It just doesn’t make sense for our budget deficit to be $483 billion in the last fiscal year and for our national debt to increase $1.13 trillion over the same period.

In these pages, you’ve seen me predict a U.S. national debt of $34.0 trillion. While I may be the only economist out there with this prediction, we must remember three things: First, the aging U.S. population will put a strain on Social Security and health costs in the years ahead. Second, the number of eligible U.S. workers in the workforce is at a 30-year low. Finally, about half of the U.S. population is on some form of government assistance.

Who is going to pay for all this? The government will, with more and more borrowed (and eventually printed) money. That current rally in the U.S. dollar…I don’t see it lasting in 2015.