The current account deficits incurred by the United States in the 1980s were caused, in the opinion of many economists, by

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Many economists believe that the current account deficits were caused by federal budget deficits. When the US government runs budget deficits, it borrows money by issuing Treasury bonds. This increases the supply of US dollars, which can lead to a decline in the value of the dollar relative to other currencies. This makes imports more expensive and exports cheaper, contributing to a current account deficit. Additionally, the government was also spending money on defense and foreign aid, which further increased the deficit.

The Current Account Deficits Incurred by the United States in the 1980s