with economics than with politics and morality. Budget deficits don't crowd out private investment, government spending does, and a large surplus may not be a sign of strength for a country. Some say it is impossible for every country to run either a surplus or a deficit. What matters is that a country can service its debts (Defense 68). During most of the 19th century, the United States borrowed from the world (a current-account deficit). By 1870, it was running a trade surplus, and by 1900 we had a current-account surplus. But in the early 2Oth century, the U.S. became the world's largest net creditor, and by 1970 it peaked by finally running into deficit in 1970. Finally, 1980 brought a deficit so large, that the government was a net debtor again (Bottom Line 14). Current Reductions: One of the ways we are currently reducing the deficit includes the introduction of "means testing." This means that people would get entitlements based on need. The government already has reduced Social Security for modest income seniors age 70 and younger, but budget cutters want to broaden that idea (Henderson 60). There are 2 major problems with means testing. First, it is considered inherently unfair. Some might argue that a person might blow all of their income before the entitlement reductions come into place. Second, it might reduce the incentive to work and encourage people to hide their income. For instance, beneficiaries of Social Security, ages 62-64, lose $1.00 yearly in benefits for every $2.00 they earn in income or wages above $8,160 per year (Henderson 60). Some say increasing eligibility requirements would solve some problems, and propose raising the age of early retirement from 62 to 65, and standard retirement from 65 to 70. Another touchy subject in budget reduction is the argument that the poor are being left out of savings. According to the Clinton Administration, the GOP budget would cause a family with income of $13,325 per year ...
