Over 10 years ago, a new word emerged from the backwaters of the dictionary to become a regular feature in popular conversation.
In fact, to call it a word is incorrect, it was a term and the term was ‘The Deficit’.
I’ll stop capitalising and wrapping it in quotation marks now, but for many years reducing the deficit was a major priority.
Now I need to confess, for a long time (I won’t confess how long), I assumed the deficit just meant the national debt.
What I didn’t quite grasp was that the deficit and the national debt are two different things.
The deficit is simply the difference between what the government earns each year (largely through taxes) and what it spends.
If the government spends less than it earns, then the difference is called a surplus.
The debt is the amount of money owed by the government. Compared to the deficit, the national debt is ginormous.
You don’t hear the deficit being talked about that much these days, but next time it comes around, I’ll at least know what everyone is talking about!
Thanks for reading 🙂