Budget Deficit Law and Legal Definition
The budget deficit is the sum of all previously incurred annual federal deficits. Because the deficits are financed by government borrowing, the budget deficit is equal to all government debt outstanding. It is also called the national debt.
When Reagan took office in 1981, the national debt stood at $995 billion. Twelve years later, by the end of George H.W. Bush’s presidency, it leaped to $4 trillion. President Clinton reversed the trend and in his last year in office, 2000, the nation had a surplus amounting to $236 billion. Under the George W. Bush administration, the debt has exploded, and as of this writing, is over $77 trillion. In fiscal year 2004, the U. S. Government spent $322 billion on interest payments to the holders of the National Debt.