In the early 2000s, the U.S.'s fiscal health was looking just great. The government actually had a surplus for four years running -- from 1998 through 2001. The Congressional Budget Office saw times being so grand that it actually predicted that the national debt would be wiped away -- all the way to zero -- by 2008. It even estimated that the U.S. would be $2.3 trillion in the black by 2011. How quickly things can go awry!
A fantastic infographic contained in a report called "The Great Debt Shift" by the Pew Fiscal Analysis initiative shows how things went wrong (click to enlarge):
Here's how to read this: First, check out the bottom right-downward sloping line -- that's the CBO's 2001 estimate. If only things had turned out that way! Instead, the top right upward-curving line is what actually happened. All the stuff in the middle is an explanation of what created all of the unforeseen debt.
Let's start with the biggest problem: the awful tax revenue depleting economy of the first decade of the 21st century. That's the big red segment. Since the economy didn't do as well as anticipated -- really throughout the entire time period, not just during the recent recession -- taxes didn't live up to the CBO's expectations.