US to borrow $3tn to provide COVID-19 rescue financial packages

The US has claimed it wishes to borrow a record $3t, as the budget for this quarter has been blown on COVID-19 financial rescue packages. In the whole of 2018, the county borrowed $1.28t, meaning $3t is a significant increase for the government.

If the US government is successful at securing this figure, the total debt the US government is currently in will rise to $25tn. This news follows after the US extended its annual deadline for tax payments, due to COVID-19.

The chair of America’s central bank, Jerome Powell, said that he wished the US government’s financial books had been in better shape before the pandemic. He did agree, however, that spending is essential to cushion the economy from further economic blows. He said, ‘it may well be that the economy will need more help from all of us if the recovery is to be a robust one’. The US’s journey to recovery is excepted to be a long one as over 30 million people are estimated to have lost their jobs due to the pandemic.

Some Republican politicians have expressed concern about how more spending could impact the country’s rising national debt, while others argue spending is essential for the long-term growth of the US.

Source:

BBC