What is a balanced budget, and why is it so much easier to balance state budgets than the federal budget?
A balanced budget simply means that the government spends no more than it takes in. Pure and simple! Some states have mandatory balanced budget laws. This forces the state legislature to balance the budget. There is no such requirement in the Federal budget. The last time we had a balanced budget was during the Clinton administration. He actually left office with a SURPLUS, meaning that the govermnent spent LESS than it took in. The last time prior to Clinton was during the Johnson administration -- 1964 or 1965 if memory serves properly. The current administration has run the budget squarely into the toilet. In a little over 5 years, they squandered the surplus left to them and ran the deficit to a level higher than the combined deficits of EVERY prior administration in the history of the nation COMBINED. Even if 9/11, Iraq and Katrina are factored out, it would STILL be the largest deficit in history. Kinda makes you wonder, doesn't it?? $7 TRILLION down the drain and still flushing!
How do you track your budget and money balance?
As we are on a 9-months journey discovering Southeast Asia, tracking our budget and making sure we are still on track is a critical daily exercise. Here’s how we track our budget and money balance:The processI set up my daily average budget goal per country (using some online resources helping me understand cost expectations).As expenses occur (or latest at the end of the day), I note down all the expenses which have occurred and assign them to one of the categories we have defined (e.g. accommodation, food, transport etc. We have 8 in total).Every morning we check our balance and review current breakdown to understand where the discrepancies (if there are any) are coming from. We then agree on whatever adjustments we need to make to get back on track with our budget.Since we are tracking all our expenses, I know exactly how much I have spent and how much I can expect to spend in the next months.Once a week I check my bank account statement to make sure the balance is as expected, as well as to check there is no dubious activity with my credit cards.The toolsWe have set a google spreadsheet for tracking our travel budget. After having tried a couple of tools, this seems to work the best for us.We don’t have a common back account, so we use SettleUp to keep track of who has spend how much money.We have written a very detailed (yet easy to follow) guide to travel budgeting which can easily be implemented for other purposes as well.Hope this helps.
Should the US have a balanced budget?
Firstly, there is a big difference between a deficit and debt. Debt is the accumulation of all your debts/deficits, so each year you have a deficit, your debt gets worse. Everytime you have a surplus, your debt shrinks because you can pay part of it off.Sorry, now to answer your question. Yes, the US should definitely try to balance its budget. That's not always possible, like during a recession when we need spending to stimulate the economy, but right now the US is in an expansion and they should be trying to run a budget surplus by increasing taxes or cutting spending, or both. Now is the time to run a surplus. Interestingly enough, the spending and revenue (taxes) of the US government is actually about balanced right now, however the deficit is because they still have to spend billions each year to pay the interest on the debt.In reality, the US government doesn't NEED to run a balanced budget (short term as in for the next 20 years) because nobody thinks they're going to fail, so they can keep getting loans. The real issue arises when people think buying US bonds is risky.
Why doesn't the US Government have a balanced budget amendment?
For that matter why don't ALL the states have balanced budget amendments? Wikipedia has a very good article about balanced budgets proposed in the past. One even included a provision that would require the President would submit to Congress a budget that would balance. My state Arkansas does not permit (it's in our Constitution) a budget that does not balance. Lawmakers have a choice every session. If they want to spend more and the state revenues aren't on the rise and there's not an existing surplus, they have to raise taxes. We may not have all the 'benefits' places like California or New York do but we're not in hock up to our eyeballs either. I know it's late. As the adage goes you don't wait till you are thirsty to start digging a well. But at $10 trillion dollars in debt and rising fast something needs to be done, and done quickly. Pardon me for being skeptical but I don't believe spending like there's no tomorrow is the answer.
Why Should the Government Balance not Balance its budget?
To have what we consider a balanced budget, the total amount of gov revenues must be equal to or greater than the total amount of expenditures. To make more than what is spent is known as a surplus, and less is knon as a deficit. A historical accumulation of deficits is called national debt. Here are some of the points I can think off of the top of my head: Deficits can sometimes be investments yielding greater returns in the future. If the US could manage a surplus by eliminating financial aid expidentures to college students, then many of them would be forced to drop out and we would we would have less higher paying jobs to earn tax revenues from. Sometimes eliminating some of your largest deficits can be rather suicidal. If congress cut off spending from the troops in Iraq, then they would have no supplies to fight with and would be forced to abandon it (which is far different than a withdrawal). If the President decided to limit funding to social security retirees (which I believe Soc. Sec. is the largest of all deficits), then over one fifth of the elderly would be in poverty. Unless spending and debt is out of controll, there really is no urgent need to balance the budget. Unless spending were to be expanded onto squanderous levels to fund things such as a Woodstock museum or missiles in space, then therer really isn't a need to forgo other opportunities. If the interest on the national debt were costing us a fortune, then maybe we would have a bigger problem. Well I hoped that help. I try to be very detailed in my answers to school questions because I ask them myself.
Why is balancing the federal budget so hard?
Couple of reasons - Washington politicians can't agree on how to balance it: whether to raise taxes (and on whom), where to cut spending (and how much), etc. It's even worse nowadays in a perpetually polarizing political climate. - The US (and every other government in the world) has the ability to borrow large sums of money via bond issuing, which the rest of the world (other countries, other businesses, common people, etc.) gobbles up readily (for now, at least). Further, there is no mechanism other than the trustworthiness of the US government to ensure that the lenders will ever get their money back: if the US government decided tomorrow that they wouldn't repay the bonds (defaulting), there's no legal force that can make them repay it.
Has a Republican EVER balanced any budget?
Dwight Eisenhower was last Republican President to preside over a balanced budget. He had a balanced budget in 1956 and 1957. Since then, there have been two presidents to preside over balanced budgets, LBJ in 1969 and Clinton in 1998 through 2001. During the last 40 years there have been five budget surpluses, all five were under Democratic Presidents: 1969, 1998, 1999, 2000, and 2001 Read more: http://wiki.answers.com/Q/Which_republican_president_balanced_a_budget
Benefits of requiring a balanced budget?
A balanced budget amendment would require a creation of a surplus fund for bad times, and control the relentless spending which has become the nature of DC. Also the debt would be bought back by the American people, and not the Chinese who now have influence and will soon dictate US foreign policy. The best thing you can do is vote out the parties and install independent politicians. My logic for this is that the political parties are already corrupted and controlled by these lobbyist institutions and with Independents in office it is harder for corporations to control the legislation and the politicians will not be able to hide as well as they do There are no lefties or righties, just Democrat and Republicans, of course those numbers are shrinking. Independents and other parties are slowly gaining, I figure in 10 years there will only be Independents and minority parities