Evolution of Debt Financing Strategies

Evolution of Debt Financing Strategies

The United States saw its first budget deficit when it borrowed $75 million during the Revolutionary War. But, the quick repayment of this loan led to several years of budget surpluses. However, the War of 1812 forced the country to borrow again, resulting in substantial debt. This cycle of accumulating large debts due to major wars continued to happen over the next two hundred years.