Budget Year

Is it possible to balance the budget each year?

If congress wanted to balance the budget each year Is it possible to balance the budget each year? If yes, why would it be desirable or why not? Any help :)

Public Comments

1. Yes. This is most desireable to keep our purchasing power high and to keep the dollar from losing value.
2. Fiscal policy requires that a deficit be run in times of recession and a surplus in time of expansion. So it is not possible to balance the budget each years. But it is desirable that it should be balanced on average. Moreover because the deficit are the engines of the power of politicians it is not even possible to balance it any year.
3. Yes, but it would not be extremely desirable for congress to balance the budget every year. Like a healthy business, the government should run a *moderate* deficit. A moderate deficit is one that doesn't outpace the growth of the economy. We were able to balance the budget in the 90's, there weren't any ill effects. As far as the value of the dollar goes, the dollar is currently overvalued because china buys up US securities in order to keep its exchange rate with the US pegged. We may even benefit if the dollar devalued slightly, as that would increase US exports.