Primary deficits: a short history

According to the Federal Reserve Bank of St. Louis's FRED Blog, the United States government faces a key distinction when measuring its budget deficit. There are two main measures. A primary deficit measures the gap between tax revenue and spending, excluding interest on existing debt. A total deficit includes all spending, plus all interest payments the government owes. This matters because it separates the nation's current fiscal problem from the accumulated debt burden. By understanding both measures, you can see how much of the deficit comes from ongoing government spending versus the cost of servicing money the nation has already borrowed.

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