Just like a household, the U.S. federal government operates on an annual budget. While households spend money on food, clothing, and shelter, the U.S. government spends money on big items such as roads, defense, and education. If a household spends more than it earns each year, it must borrow money or dip into savings, if available. So too for the government. When it spends more than it takes in through taxes and other revenues, a deficit occurs and it must borrow money. This chapter explores budgeting, deficits, surpluses, and debt—government style.
KeywordsSocial Security Federal Government Fiscal Policy Government Spending Trust Fund
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- 1.Social Security Administration. Social Security Basic Facts. Available at www.ssa.gov (Accessed June 28, 2011).
- 2.Ibid.Google Scholar
- 3.IbidGoogle Scholar
- 4.The 2011 Annual Report of the Board of Trustees of the Federal Old-Age and Survivors Insurance and Federal Disability Insurance Trust Funds, May 13, 2011, Washington, D.C.: U.S. Government Printing Office. Available at www.ssa.gov (Accessed June 16, 2011), p.12.