Deficit Friend or Foe

A detailed Summary of Deficit Friend or Foe


In the essay "Why is the Deficit a God Send and Five Other Economic Heresies" by Walter Russell Mead he discusses the concepts of national debt and budget deficit. Both the debt and the deficit have some positive and negative consequences. The deficit can play a positive role in an economy in economic growth.

To fully support my argument that the deficit is good for countries such as the United States and Canada I would like to make the following points. The debt is the sum of the deficits that are owed to the banks that have lent the money to the country. A budget deficit occurs when the countries balance of expenditures minus the income it receives is equal to a negative number this causes the country to have a debt to other countries (Parkin 611). In most countries a balanced budget is not efficient additional funding is necessary to support all of the programs in place.

A country can survive living in debt because unlike private citizens the governments of both Canada and the United States rarely have to pay back their debts to other countries. If a person


1. Mead, Walter Russell. "Why the deficit is a God Send." Intersections: Essays in the Sciences and Humanities. Scarborough, Ontario: Prentice-Hall Canada Inc, 1999.

Countries such as Canada and the United States have come to rely on the deficit to be able to function on what the country makes. The deficit is definitely a benefit to both countries at the moment since the deficit is relatively small in comparison with the gross domestic product (mead 173). If the budget deficit is used sensibly it will continue to spark economic growth in Canada and the United States.



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Approximate Word count = 746
Approximate Pages = 3 (250 words per page double spaced)

Category: Miscellaneous

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