Actally, Steve, there was a time relatively recently when we were pretty close to having a surplus. Alan Greenspan discussed it at some length in his book, The Age Of Turbulence. As I recall, a surplus almost happened right at the end of the second Clinton term.

Greenspan described waking at night worrying about what would happen if the country actually generated a surplus. He was worried that the only possible alternative would have been that the Congress would have to make decisions to invest the money. He believed that the absolute worst and most incompetent group to make actual investment decisions would be the U.S. Congress. But he didn't think that would ever happen and that the Congress, if they ever found out that a surplus was expected, would go on a crazy spending spree. He assigned little to no chance that if a surplus occurred that the Congress would actually cut taxes. Greenspan decided that he would do everything in his power to disguise or mislead the Congress regarding the possibility of a surplus during Congressional hearings so as to avoid what he thought would be the inevitable unrestrained spending.

As it turned out, the economy slowed and a surplus was never created. Shortly thereafter, Congress let the Pay-Go requirement to force a balanced budget which had been in effect since 1990 expire thru a sunset provision in the original law. What followed was 9-11, dramatic increases in military spending as well as the "crazy spending spree" that Greenspan worried about, which was made possible by the expiry of Pay-Go.

That pattern of unrestrained government spending continued throughout both terms of George W. Bush and continues now in the early months of the Obama administration. We have become the greatest debtor nation in world history in less than a decade. But we came awfully close--less than a decade ago--of actually having a federal surplus. Now we're approaching the point that spending will have to be reigned in because of restrictions we are likely to encounter in being able to continue to borrow in order to finance our deficit spending.