MONETARY AND FISCAL POLICY, THE BALANCED BUDGET AGREEMENT, AND THE UNITED STATES ECONOMY
During the four fiscal years in which Jimmy Carter was president (fiscal years 1977-1980), the federal budget deficits totaled $226.8 billion. This cumulative Carter Administration deficit followed a cumulative deficit of $144.1 billion in the 1973-1976 fiscal year period of the Nixon/Ford presidency. The cumulative four year deficit increased $82.7 billion, or 57.4 percent, from Nixon/Ford to Carter, in terms of current dollars.
Under President Reagan, the cumulative budget deficit in the Administration's first term (fiscal years 1981-1984) was $599.9 billion. The cumulative four year deficit increased $373.1 billion, or 164.5 percent, from Carter to Reagan, in terms of current dollars. The deficit for the second term of the Reagan Administration was $776.2 billion·a 28 percent increase over the first term, and a 242.2 percent over the cumulative Carter Administration deficit which, during the 1980 election, was decried by candidate Reagan as being irresponsible, and severely damaging to the economy. During the four years of the Bush Administration, the budget deficit continued to climb. The advent of the Clinton Administration has witnessed a decline in the level of the federal budget deficit, along with renewed interest in balancing the budget.
Federal budget deficits did not originate with Nixon, Ford, Carter, Reagan, Bush or Clinton. The last federal budget surplus occurred in fiscal 1969, and that is the only one which has been recorded in the past 30-years. Under Ronald Reagan and George Bush, however, federal budget deficits spiraled to undreamed of heights, and to levels which many economists think threaten the future economic stability of the country.
The biggest differences between Nixon/Ford and Carter, on the one hand, and Reagan/Bush, on the other, in the context of fiscal management are that the earlier admi...