The US government is spending money at a torrid pace. Uncle Sam blew through $547 billion in January. That brings total spending through the first four months of fiscal 2021 to $1.92 trillion.
And the spending spree is only going to increase. Congress continues to debate another $1.9 trillion stimulus package and there’s already talk of an infrastructure spending bill in the pipeline after that.
This raises the $1.9 trillion question: how is the government going to pay for all this?
After running the biggest December budget deficit in history, the US government followed up with another massive budget shortfall in January.
According to the Monthly Treasury Statement, the January deficit came in at $162.83 billion. That’s nearly five times bigger than the January 2020 shortfall.
Peter Schiff recently spoke at the January 2021 Virtual Money Show. He explained why the coming financial crisis will be much worse than 2008, and how the Federal Reserve and the US government are driving us toward this crisis with their inflationary monetary policy.
President-elect Joe Biden unveiled his massive stimulus plan last week touted as the “American Rescue Plan.” In his podcast, Peter Schiff said it was more like throwing a drowning man an anchor.
President Trump threw a wrench into coronavirus stimulus relief, calling the massive spending bill “a disgrace” and threatening to veto the legislation if Congress doesn’t go back and up the individual checks from $600 to $2,000.
It remains unclear how the politics will play out. House Speaker Nancy Pelosi tweeted “Let’s do it!” putting pressure on Sen. President Mitch McConnel to go along with the increased stimulus. What is pretty certain is stimulus is coming down the pike – whether sooner or later. Before Trump made his surprise remarks, Peter Schiff talked about the stimulus bill on his podcast.
The US government is stimulating everybody. Just not you.
Congress finally pulled together a stimulus deal. Both houses of Congress passed the $900 billion measure. It ranks as the second-largest “stimulus” bill in history, only behind the CARES Act passed earlier this year.
The US government kicked off fiscal 2021 with the biggest October deficit in history. But with the first of November falling on a weekend, some November spending got shifted into October, inflating that month’s deficit. Now that we have the November monthly Treasury Statement, we have a better sense of how big deficits are running in the new fiscal year.
In two words — really big.
If you thought maybe the federal government would try to rein in the spending after running a recorded budget deficit of $3.13 trillion in fiscal 2020, you were sorely disappointed. Uncle Sam has not kicked his spending habit.
October was the first month of FY 2021 and the federal government kicked off the year with a $284.1 billion budget deficit, according to the latest Monthly Treasury Statement. It was the largest October budget shortfall in American history.
The FY2020 budget deficit came in at $3.13 trillion. At some point, the US government will have to reckon with the debt and spending. But according to recent analysis from the nonpartisan Committee for a Responsible Budget, neither Trump nor Biden appear prepared to do so. In fact, its analysis shows Trump would only be slightly better than Biden when it comes to spending and debt.