Follow up: is it realistically achievable ever again, and should it even be a goal to be concerned with?
In: Economics
The missing part of your question is whether it would be a good idea to balance the federal budget. It would not. The federal debt is the wellspring of our currency: dollars are literally made out of federal debt. The system is set up to ensure that there are some controls on the number of dollars in the world but that the number can grow as needed to support a growing economy.
If you balanced the budget somehow (as Bill Clinton nearly did), then there would be no new dollars created that year. That, in turn, would have bad consequences for the market economy as a whole.
Before we moved to a debt/fiat based economy, we used precious metals as the basis of the currency. That led to difficulty as the amount of money in the world was dependent on the luck of prospectors and miners, rather than on how many dollars were actually needed to keep industry moving. There were a series of disastrous “business cycles” with booms followed by terrible crashes — culminating in the Great Depression. We nearly had another of those in 2008, but the existence of a debt economy meant that the Fed could generate dollars quickly to replace the currency lost by the collapse of several large banks. That kept the recession from turning into another Great Depression.
So balancing the federal budget would open the world up to more business cycles and depressions, which would not be good. You don’t want to go there.
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