ABSTRACT
The American federal government has run budget deficits almost continuously since 1960; not since the 1920s has there been any significant effort to reduce the federal debt. Today that debt stands at around $18 trillion, or about $60,000 per person in a nation of 300 million. That growth of deficits and debt, moreover, shows no sign of stopping, let alone reversing. The same situation prevails on a smaller scale throughout our state and local governments. The total volume of state and local indebtedness now stands at around $4 trillion, and continues to grow despite the existence of balanced budget requirements in 49 states. At the federal level, moreover, legislation was enacted in 1978 to prohibit budget deficits after 1981. This legislation, named Byrd-Grassley after its sponsors, was never repealed, but neither were deficits eliminated, as David Primo (2007, 109) explains. For the better part of a century, Democratic governments have shown a strong tendency to operate with budget deficits and accumulate public debt, as Buchanan and Wagner (1977) explore and Wagner (2012) amplifies and elaborates.
