A budget deficit occurs when government spending exceeds government revenue over a certain period. the deficit will equal government spending minus revenue, where spending > revenue. A budget surplus occurs when government spending is less than government revenue in a certain period: the surplus equals revenue minus spending, where revenue > spending. The national debt The total accumulation of deficits (minus surpluses) that the federal government has incurred over time. More specifically – outstanding government bonds (securities). Treasury bonds are a very safe investment, which makes them very popular. As of May 31, 2011, the United States owes its citizens and foreign governments approximately $1.299 billion. The Obama administration inherited the largest deficit since the Great Depression. Many significant actions have been taken to strengthen our economy by creating several programs to help rebuild what has been destroyed. The Affordable Care Act of 2010, the Budget Control Act of 2011, and the American Taxpayer Relief Act of 201 have helped reduce the deficit we have accumulated. The private sector contributes greatly to the strength and resilience of the US economy. The fiscal year 2013 budget deficit report showed a decline of $409 billion from the previous year, falling from $1.1 trillion to $680 billion. (US Treasury 2013)The different causes of public debt are: wars that force us to sell bonds, recessions when there is a financial deficit with less revenue, even the lack of fiscal discipline of congress and all of us.2. Who owns the national debt? According to the Office of the Fiscal Service, the federal government's account and Federal Reserve Banks hold about... half the paper... and interest payments will increase income inequality. Because taxes and increases to pay interest on debt will discourage innovation and investment. The foreign lender will use the money to purchase goods and services from the United States. The revision of the GDP ratio takes into account the US national debt and gross domestic product (GDP). Accordingly, debts will be repaid if the lower GDP indicates a strong economy that will thrive by producing and selling goods and services. Works Cited U.S. Government 2013 Financial Report Summary Report. Office of the Fiscal Service Department of the Treasury. March 22, 2014 from http://www.factcheck.org/2013/11/who-holds-our-Debt/Frequently Asked Questions about Government Debt. Direct treasure. March 22, 2014 from https://www.treasurydirect.gov/govt/resources/faq/faq_publicdebt.htm