, Download 0
...Public Debt and the Risks of Voluminous Debt Quite simply, a government running under a budget deficit operates/expends in excess of its total revenue collections. As a result, the extra expenditures are financed by the government borrowings through the issuance of government debt, either internally or to external investors. Public debt, thus, sums up the overall stock of outstanding IOUs issued by the government in the past and not yet serviced (Diamond 1126). Intuitively, public debt equals the cumulative net borrowing by the government from the public over time, and that the annual budget deficit accruals are just but the current period additions (year, quarter, month, etc... Due Budget deficit,...