The Federal Budget Deficit and the Business Cycle. Congressional Research Service, Library of Congress, CRS Insight. Grant A. Driessen, Marc Labonte. December 9, 2016.|
The annual federal budget deficit has fallen significantly over the course of the current economic expansion, from a high of 9.8% of gross domestic product (GDP) in FY2009 to 3.2% of GDP in FY2016. However, the debt held by the public has continued to increase, and was equal to 76.6% of GDP at the end of FY2016, the highest level since FY1950. This Insight discusses how deficits responded to previous expansions and recessions. Based on historical experience, recent trends toward achieving fiscal sustainability are likely to reverse the next time the economy enters a recession.
[PDF format, 4 pages, 240.73 KB].