Abstract Looking at the government’s budget it spends a certain amount every year on things that it actually buys and another amount to pay interest on the debt. The existing debt shrinks by about 2 percent a year in real terms because of the inflation. In each year, however, it continues to expand in terms of the inflated currency. The problem, which I wish to address, is whether the annual shrinkage of the debt should be included in income for the nation. If so it would be one of the largest items in the income side of the balance sheet. Indeed, in many years it would turn out that there was no deficit at all.