What is the difference between deficit and debt?
When the government spends more than it collects in revenue and runs a deficit, it needs to make up the difference through borrowing. The sum of all that borrowing is the national debt (although there are some complicating factors, such as “off-budget expenditures” and how certain kinds of spending are counted for deficits). In other words, the deficit is the yearly shortfall, and the debt is the total amount that the government owes to its creditors from whom it borrowed to make up those shortfalls.
