A budget deficit occurs when a government's expenditures exceed its revenues over a specific period, typically a year. This shortfall often leads to increased borrowing and a rise in national debt, influencing government policy by compelling lawmakers to make tough decisions regarding spending priorities. Budget deficits can prompt debates around fiscal responsibility and economic growth. While some argue that deficits can be necessary to stimulate the economy during downturns, persistent deficits can raise concerns about long-term sustainability and financial stability, affecting public confidence and investment.