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During the Great Recession, like any other economic downturns, as unemployment rises, aggregate income declines causing a major decline in tax collections. On the other hand, with the rise in unemployment, spending on safety net programs rise. So, to stabilize the national economy, government appears to have only two options (neither good) either to put in place severe austerity measures (cut spending) or increase borrowing. Of course, it is very difficult to defend cuts in the federal government programs and especially the programs geared to sustain the minimum of the standard of living for the "poor." But increase in borrowing has major adverse impacts on the national economy.
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