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Economics
Budget Deficit
When the government spends more money in a year than it collects in taxes and other revenue.
Deficits aren't always terrible in a recession (they can stimulate the economy), but big, constant deficits add to the national debt and can eventually push interest rates higher.It's like a teenager who spends $120 on sneakers and snacks but only gets $80 allowance — they have to borrow the extra $40.
Real world: The U.S. government often runs a budget deficit, so it sells Treasury bonds to borrow money and cover the gap between spending and tax revenue.
💡 Budget deficits are like using a credit card for the whole country — useful in emergencies, but you don't want to live on plastic forever.