Government Spending & Debt

Infrastructure consists of a business, region, or nation’s physical systems and facilities, which can be used in the production of public goods or services. Infrastructure is typically owned by state and local governments; however, some infrastructure is privately owned.

Universal basic income (UBI) is a government program that provides monthly unconditional payments to every member of a community. UBI seeks to combat economic inequality and provide economic security by ensuring a basic standard of living.

In the context of public sector budgeting, a balanced budget is one where the total expected government spending in a given period is equal to the amount of income it expects to receive during the same period. Balanced budgets avoid the debt burdens of deficits and the potential deflationary pressure of surpluses.

When referring to a government’s financial state, a budget surplus is the result of fiscal revenue exceeding expenditures. While a surplus means having additional money to pay off debt or reinvest, it also removes that money from the wider economy, which can have a deflationary effect.

A fiscal deficit is the result of a government’s spending exceeding its income. Although budget deficits cause an increase in national debt and represent a major systemic risk to an economy, deficit spending is also a way for governments to combat a recession.

The debt ceiling is the legal limit on the total amount of federal debt the U.S. government can accrue without risking a default on its legal obligations. Since 1960, Congress has acted 78 times to permanently raise, temporarily extend, or revise the definition of the debt ceiling.

A bailout is money and/or other resources provided to a struggling entity by a business, individual, or government. Bailout can include loans, bonds, stocks, or cash and may require reimbursement (potentially with interest), depending on the terms of the agreement.