Why do people hate deficits?

Posted by Dylan Matthews on April 8, 2013 at 2:48 pm

People really don’t like deficits. Polls measuring national priorities tend to find that the deficit/debt is the second most important issue to voters, after “the economy” generally and ahead of health care, guns, foreign policy and immigration.

Politicians don’t like deficits either. Both President Obama and the Republican leadership in the House pay lip service to wanting to reduce the national debt burden, and almost all their fights to date have centered on how best to do that.

But hold on a second. Why do we hate deficits? “Balancing the budget” sounds really nice, but what reason do we have to believe it’s actually valuable? There are a number of reasons to think it might be good for the debt load to be smaller rather than larger, but almost all of them are controversial among economists, and some more so than others. Here are the common reasons for balancing the budget you hear, and what the evidence says about each.