- Higher deficits mean the government borrows more, which can push up interest rates over time (making mortgages, car loans, and credit card debt pricier)
- Interest payments on the national debt eat into the federal budget — money that could otherwise go to programs — and that interest burden has grown significantly as debt has increased
- Long-term, persistent deficits raise questions about future tax increases or spending cuts to programs like Social Security and Medicare
- Some economists argue deficit spending can also stimulate the economy in downturns, so the effects aren't uniformly negative — it depends on timing and context
What can individuals do about it:
- Vote, and pay attention to candidates' actual fiscal platforms rather than rhetoric
- Contact elected representatives about specific spending or tax policy
- Support advocacy organizations focused on fiscal policy (these span the political spectrum — from groups pushing for spending cuts to those pushing for tax increases on higher earners)
- Beyond that, there's genuinely not a lot direct control an individual has — the deficit is driven by broad structural factors (entitlement spending, tax policy, interest rates) that are set at the federal level
Links
Learn about the national deficit, the difference between budget deficit and
debt, and how the deficit has changed over time.