national debt
national debt. Throughout history governments have had difficulty in maintaining the balance between income and expenditure, since the former relies on the raising of taxation which is seldom popular. The national debt is the excess of expenditure over revenue, often accumulated over many years and financed by borrowing. This debt grew markedly in the 18th cent. as a result of involvement in numerous wars. (See financial revolution.) The Napoleonic wars lasted for a quarter of a century and were especially expensive. Public expenditure fell to a more modest scale throughout the 19th cent. and the national debt actually fell. It escalated in the 20th cent. as a result of war and the increasing state obligations for welfare payments such as social security and pensions. At the beginning of the century, public spending stood at about 10 per cent of national income, but since the Second World War it has varied in the 40–50 per cent range. But the rapid inflation in the 1970s created a large imbalance between taxation and expenditure and thus increased the deficit. The national debt, now more usually known as the public sector borrowing requirement, has recently ranged between 6 and 8 per cent of national income.
Clive H. Lee
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national debt