How are countries with constant or growing deficits not bankrupt?

Question

For example, the US and Canada have yearly deficits in the billions. Technically, doesn’t this mean the country is isolvent?

How often are countries in the surplus? What would they do with the extra funds/savings?

In: Economics

Answer 1

Because their GDP increases; it is unsustainable when debt grows faster than GDP. If you make $60,000/year a $200,000 house is a reasonable amount of debt to have. If your income doubled to $120,000 you could afford 2x the house. The US hasn’t been in a surplus since Bill Clinton was in office.