Definitions of government deficit and debt
Here's what's meant by the deficit and the debt — and how the government can address them:
The amount by which spending exceeds revenue during a budget year. When a government spends more than it collects in tax revenue, it runs a deficit for that budget year.
A build-up of annual deficits. A government that runs a deficit each budget year must borrow to meet expenses. In doing so, it accumulates a debt. The total U.S. debt tops $16 trillion. The government must pay interest each year on its debt — payments that contribute to each year's deficit.
— THE WAY OUT:
Deficits can be reduced or eliminated when a government cuts spending or raises taxes — or both — or when a strengthening economy generates more tax revenue.