Which economic factor helped to eliminate the deficit in 1998?

Strong economic growth in 1998 played a crucial role in eliminating the budget deficit. The late 1990s were characterized by a booming economy in the United States, driven by advancements in technology, increased productivity, and a surge in consumer spending. This economic expansion resulted in higher tax revenues as individuals and businesses earned more income, leading to increased federal revenue without raising tax rates.

The combination of a growing workforce and low unemployment rates contributed to the overall health of the economy, which supported government initiatives and investments. Consequently, the federal budget shifted from a deficit to a surplus, primarily due to this robust economic climate. This growth was significant enough to counteract any additional spending or adjustments in fiscal policy, making it the key factor in the fiscal turnaround of that year.