A debate that’s been happening among economists for years now is whether or not we should care about our national budget. The reason for this debate is because the United States (along with the rest of the world) is in a lot of debt. $27,472,491,111,039 to be exact. That amount has actually increased by at least $5,000,000 by the time you’re reading this article.
“Balancing the budget” is basically a fancy way of saying that expected revenues equals planned spending. It’s commonly used when talking about official government budgets. An example of this is when politicians say they have a balanced budget for the upcoming tax year. When revenues exceed expenses, it’s a budget surplus, and when the opposite happens there’s a budget deficit.
The government splits their spending in two categories: mandatory spending and discretionary spending. Combined, these categories pay for more than 90% of all government spending.
Mandatory spending is something Congress legislates outside of their well-known appropriation process which mostly covers medicare and social security. It also included programs like food stamps and transportation.
Discretionary spending is something that is decided by Congress through an annual appropriation process. It includes programs like the military, international affairs, education, energy, and the environment.
Those who don’t think we should worry about our national debt argue that there are other, bigger issues to worry about. While this isn’t a bad argument, it is worth pointing out that the government shouldn’t operate as a for profit business, but for the people. Some economists think that it’s worth it to have debt (at least in the short-run) because it will help the government fight an economic downturn.