For the next several weeks, and likely through election season, Washington will continue to be gripped by the debate about how to reduce federal deficits and the national debt. It's a common focus of legislative preening, particularly after economic downturns, and even more particularly when Democrats control the White House.
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So it's worth keeping in mind how current and projected deficits and debt stack up to their historic levels, relative to GDP. The answers will surprise you.
The following graph tracks annual deficits as percentages of GDP over the last several decades. Unsurprisingly, what you see is that they spike during economic downturns, with the most severe spike after the United States entered World War II -- a spending effort that provided the economic stimulus the country needed to finally break the back of the Great Depression.
National surpluses shrank as the country entered a mild recession at the end of the Clinton administration, got worse after President Bush spearheaded deficit financed tax cuts, wars, and domestic spending, and ballooned just as Obama took office thanks to the double whammy of a sharp decline in revenues, which plunged when the bottom fell out of the economy after the financial crisis, and stimulus spending to salvage the economy.