Everything you need to know about the deficit

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from The Washington Post,

Okay, so don’t laugh at me, but what is a deficit?

It’s actually not a dumb question, not least because there are plenty of deficits that federal economic policymakers have to keep track of. There’s the current account deficit, for one, and the closely related trade deficit. But ignore those. The one we’re talking about here is the budget deficit. That’s the gap between the amount of money that the federal government is taking in (mainly through taxes but also stuff like civil forfeiture by law enforcement and profits from federal holdings like Fannie and Freddie) and the amount it’s spending.

Do we usually have a deficit?

How big is the deficit?

Eek! Is is going up or down?

Wait, aren’t the deficit and the debt the same thing?

How much debt do we have?

Is borrowing all that money bad?

Doesn’t having a lot of debt hurt growth, though?

How did we get all this debt anyway?

I’ve heard people say we need to “stabilize the debt.” What would that take?

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