Question

For the fiscal year that ended on September 30, 2017 the U.S. federal deficit was $666 billion, an increase of $80 billion from 2016. This was the second consecutive year the deficit has increased, following several years of decline. (The deficit was over $1 trillion in 2012 and had fallen to $438 billion in 2015, but the current deficit is more than $500 billion higher than the $161 billion deficit in 2007, the year the Great Recession began.) The Congressional Budget Office projects a slight decrease in the federal deficit to $581 billion for 2018, but predicts a widening of the deficit to almost $1.5 trillion by 2027 if current laws do not change.

In 2017, the deficit as a percentage of GDP was 3.5 percent, federal government spending was approximately $4 trillion (up more than 30 percent from 2008), while tax revenues were $3.3 trillion. Presently, the national debt stands at more than $20.6 trillion (104% of GDP), which equates to a debt of more than $63,000 per citizen and over $170,000 per taxpayer. You can view the national debt clock at: US Debt Clock.

Discuss the economic consequences of a rapidly increasing federal deficit and national debt. Should we be concerned about the sizes (and estimated future sizes) of the federal deficit and national debt, or are the concerns overblown? Who exactly do we owe this money to? How might the government reduce the deficit and debt numbers? The above questions are just a few relating to the federal deficit and national debt. Please do not feel limited by addressing just these questions, but feel free to expand your discussion to the wide variety of issues stemming from the growing federal deficit and national debt.

Answer 1