Changes

It is important to note that, while the Federal Government cannot bankrupt itself, there are certain costs associated with running a budget deficit year after year. If deficit spending is not spent on real assets that encourage future economic growth (investment in capital goods), the national debt will grow relative to the nation's gross domestic product (GDP), thereby diminishing the theoretical capacity of the government to repay what it owes. Large deficits also incur relatively large interest payments, which limit the government's ability to spend in other areas.

It is important to note that, while the Federal Government cannot bankrupt itself, there are certain costs associated with running a budget deficit year after year. If deficit spending is not spent on real assets that encourage future economic growth (investment in capital goods), the national debt will grow relative to the nation's gross domestic product (GDP), thereby diminishing the theoretical capacity of the government to repay what it owes. Large deficits also incur relatively large interest payments, which limit the government's ability to spend in other areas.