Just after his inauguration, President Barack Obama made a pledge: to cut the nation's $1.3tn deficit in half by the end of his first term. Sunday marks a sobering day for the president and his promise – the end of another fiscal year with a deficit surpassing $1tn.

Despite marginal improvements this is the fourth straight year that the deficit has passed the $1tn mark, adding to a national debt that passed $16tn for the first time this year.

Obama inherited an economy in crisis only to find the situation was even worse than it appeared. He also inherited wars and tax cuts that have drained the nation's coffers. But his own decisions, including a massive stimulus programme, as well as those beyond his control, have increased the US's debt by $6tn under his watch. The size of the deficit and Obama's failure to tackle it are likely to be hot topics as the president squares off with Mitt Romney for the first presidential debate on Wednesday.

Romney and his vice-presidential pick Paul Ryan have hammered Obama's record on debt. "When he came into office, there was just over $10tn in debt. Now there's over $16tn in debt. If he were re-elected, I can assure you it will be almost $20tn in debt," Romney told voters in Ohio last week. "And by the way, those debts get passed on to our kids. It's not just bad for the economy; it's not just bad for our job creation; it will … in my opinion, it is immoral for us to pass on obligations like that to the next generation."

Romney has said he plans to balance the annual budget in eight to 10 years but has given scant details of exactly how that will be achieved. Obama's most recent budget proposal called for $5.3tn in deficit reduction over the next decade. Again, details are in short supply. The president's budget claims the deficit will be $901bn in 2013, better but still far short of his $650bn promise.

For most people it simply doesn't matter, until it does, said Ken Goldstein, economist at The Conference Board in New York. "Walk into any bar tonight and ask 20 people and I bet not one of them knows what the deficit is or what it means. It's abstract, we don't feel it. Its impact is indirect and it's not immediate."

All that could change come 31 December – the fiscal cliff – when Bush-era tax cuts are set to expire and a draconian round of spending cuts will be implemented unless a political compromise can be reached.

The tax hike will increase the tax burden by $380bn while the spending cuts take $100bn out of the economy. The cuts to defence and social programmes were agreed in order to force a compromise between Democrats and Republicans on a plan to reduce the deficit. But a "super commitee" set up to find a third way failed leaving the cuts in place.

Goldstein said the fiscal cliff could make the abstract concrete as taxpayers absorb another knock to their finances and the swingeing cuts strike at a national and local level.

"Consumers and businesses are already dealing with three plus years of austerity. We would be piling austerity on austerity," he said. The congressional budget office has warned that failure to tackle the fiscal cliff would cause a "significant recession" and the loss of some 2m jobs.

"This will not be easy," Obama said as he made his pledge to cut the debt in half. "It will require us to make difficult decisions and face challenges we've long neglected. But I refuse to leave our children with a debt that they cannot repay – and that means taking responsibility right now, in this administration, for getting our spending under control."

Four years later that sense of urgency is growing, and so is America's debt.

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