Pros And Cons Of Government Deficit

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Economics 203 – Assignment 2
“The Federal Government should never run a deficit. There should be a law enacted to state this.” Federal Government deficit is the difference between how much a federal government takes in through taxes and how much it spends for a given year. When a government spends more money than it takes in through taxes for multiple years, it’s debt increases. I will be critically evaluating the topic statement above by considering both the pros and cons of government deficit, and finally conclude with a summation of the validity of the statement. When governments post a budget deficit for a year, many of its citizens become infuriated. People are quick to blame their elected officials. Reckless spending causes debt, and therefore their government body is reckless and irresponsible bunch. Federal budget deficit is publicly recognized as a bad thing, and there are legitimate reasons why.
When the government has a budget deficit, it is because the people in power have consciously chosen to spend more money than the government took in for a year. The adage “money doesn’t grow on trees” applies extraordinarily well when discussing budget deficits; this money must come from somewhere. A government can borrow more money from countries or other international institutions with less debt. Two popular way for governments to fund their overspending are through issuing government bonds and increasing federal taxes.
A government can borrow more money from

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