Too many questions. Federal spending is the buying of goods and services by the federal government. The government spends on salaries, equipment, supplies, travel, and also major commitments such as social security payments, medicare payments, and interest payments on the federal debt.
Most people think taxes are necessary, but the tax system is not necessarily fair. In attempts to make it fair, it has become extremely complex. Federal deficit means that the government is spending more money that it is receiving from taxation. Therefore it has to borrow the extra money and it has to pay interest on it. It borrows by issuing bonds.
How spending and taxation have changed over time can fill a book. Our current philosophy is that the rich should share a greater burden of taxes than the poor. It does not always work that way. Bush's tax cuts had the opposite effect.
· 1 decade ago