According to Edgmand, Moomaw, & Olson .
Emperato 2.
"3.2 trillion dollars of the 6.2 trillion dollar federal debt is held by the public- (423). The public debt is what impacts the economy. Because there were almost continuous debts in the years of 1962-1997, the public debt rose to astronomical levels.
Total debt, and more specifically, the public held portion of this debt, includes things such as T-Bills, bonds, and notes which are treasury securities that are sold in order for the government to have enough money to continue to run. The government is essentially borrowing this money from the public who purchase the securities. Eventually, members of the public will cash in these securities and the government must find the money to repay them. In fact, the interest from these securities alone is the 2nd largest expense in the Federal Budget (Merstein 2). .
After surpluses were achieved in the 1998-2001, Congress predicted that surpluses would continue until the year 2012. According to Edgmand, Moomaw, and Olson "The congressional Budget Office was so impressed with the surplus & the projected surpluses, that they had deemed it one of Congress' 50 Great Achievements (401). What they failed to do, however, was take into account for the unexpected. Things such as a recession and the need to come up with funds to support the "war on terror-. The bottom line is that for the last two years, and for another projected two years, the government is spending more then it is taking in, thus creating a negative net balance, or in other words, a big deficit.
There are many factors that can be contributed to why we have a deficit now, after having a surplus for the 1998-2001 fiscal years. The reason that our nation went into a surplus after the 1997 year was because of a strong economy, a booming stock market, .
Emperato 3.
and a reasonable level of government spending. Congress had projected that the surplus would continue well into the 21st century.