The United States budget and its continuing deficit has been one of the most persistent issues of recent years. The ideal of achieving a balance between expenditures and revenues has long been a political objective at the federal level, albeit an elusive one. The purpose of this paper will be to discuss the budget deficit, the history behind it, the legislative actions taken to deal with it and the associated problem and suggested solutions.
With the national debt hitting $3 trillion, the Bush administration claim the annual budget deficit will disappear by 1993 (Nasar, 1990, p. 61). But, while the deficit has been decreasing dramatically from its peak in 1966 and appears to be continuing this downward trend, the reality is that other interests will restrain the actions necessary to achieve a balanced budget.
Due largely to higher tax revenues from an expanding work force and a halt to the once exploding Pentagon budget, the federal government managed to keep the deficit down to $152 billion in the 1989-1990 budget (Redburn, 1990, p. 1). This figure represents about three percent of the U.S. economic output (the gross national product or GNP), down from a peak of 6.2 percent (p. 1). However, as the country enters an era of peace with the collapse of Communism, "the urge to splurge will become tough to contain, as demand builds for new projects like road repairs (Nasar, 1990, p. 61). History bears out this belief.
By 1797, the country already bad a national debt of $83 million due to George Washington's administration assuming the Revolutionary War debt of the individual colonies ("Evolution," 1989, p. 258). Succeeding presidents faced varying levels of deficit due mainly to varying conflicts. The first billion-dollar expenditure record and public debt level occurred with the Lincoln administration and the Civil War ("Evolution," 1989, p. 258).
The national debt level fall after that. But by 1913, it had risen a...