deficit spending


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Deficit spending

When government spending overwhelms government revenue resulting in government borrowing.

Deficit Spending

A situation in which a company, or especially a government, spends more money than it collects for a given period of time, usually a quarter or a year. Companies and government finance deficit spending with borrowing; for example, the U.S. government could issue Treasury securities. Some economic theories, notably Reaganomics and Keynesian economics, minimize the importance of government deficit spending, especially during recessions. However, deficit spending adds debt, which can be detrimental in the long term. See also: national debt.

deficit spending

Expenditures that are in excess of revenues during a given period of time. Deficit spending is generally applied to governmental units, but the concept is equally applicable to private businesses.
References in periodicals archive ?
The critique of the Obama's deficit spending, unlike for example Roosevelt's in the 1930s, is that it is not sufficiently stimulating the economy.
John Maynard Keynes, dead since 1946, was an economics don at Cambridge University who during the Great Depression advocated deficit spending by national governments to counteract unemployment.
Guess what would have happened if deficit spending was zero.
Although separate skirmishes publicized deficit spending, the ideological issue was governmental activism; and as for policy, by the late 1930s tax reform had replaced deficit spending as the focus of business attacks on the New Deal (backed by a well-funded lobbying campaign, and with their numbers strengthened in the 1938 midterm election, congressional conservatives succeeded in rescinding the graduated corporate income tax and the undistributed profits tax by 1939), a configuration of battle lines recognizable today.
Djankov was happy to report 3 straight quarters of economic growth, a reduction in the deficit spending down to roughly 2.
Republicans don't mind deficit spending if the trade-off is tax cuts and more money for the military.
By increasing its deficit spending, the government is assuming some of the burdens that the private sector might otherwise have to in order to encourage spending and investment.
Even the much-hailed John Maynard Keynes, who advocated government intervention and deficit spending as a recession antidote, would have been unlikely to approve of the type of deficit spending the US and UK are currently indulging in and advocating their Western counterparts to follow.
But Germany, Europe's biggest economy, has been strongly critical of the Prime Minister's deficit spending plan.
e] denote real GDP, the real oil price per barrel, the squared real oil price, the ratio of deficit spending to GDP, the real effective exchange rate, the real stock price, and the expected inflation rate, respectively.
That leaves an extra $15 billion to paper over the governor's deficit spending and borrowing spree for the next couple of years.
To remain in the IMF program through 2006, Nicaragua must keep deficit spending to 1.