Government Budget
Government budget refers to the amount of money the government uses for a specific period. It is the responsibility of the government to balance its budget for the well-being of a country. Leaders should regulate the flow of money inside and outside the state. Overspending is the main reason why a nation cannot balance its expenditures and revenue. Therefore it is essential to balance the budget because; it restricts the country from overspending. Finally, when a budget is not balanced, a nation faces a lot of deficit which will, in turn, raise the amount of tax collection from people, to pay for the deficits.
Steps for Balancing the Budget
The government takes different steps when balancing the budget. First, it establishes a budget by going through its past financial records to determine how much money the country receives and its expenses. The government should ensure that necessities are separated from wants. Entertainment as a want should be isolated from necessities like rent and others. This will help the government decide on how to use the available income for the well-being of a country. The budget should be updated periodically to determine actual spending in every sector. The government should review the budget regularly to identify areas that need adjustments. Lastly, the state should plan its budget of time to gauge on what it can or cannot afford.
National Debt and Budget Deficits
The national debt of a country is the amount owed by a government and is determined by balancing the budget for the past years. Budget deficits occur when the government spends more than its revenue. It happens when tax collected is insufficient to support the government. The US national debt has increased for years because of the increased budget deficit that pushed this debt higher than its GDP.
