Budget deficit grows to $ 1.7 trillion in just six months – Dateway

The U.S. government ran a budget deficit of $ 659.59 billion in March, the budget deficit to a record $ 1.7 trillion in the first half of fiscal 2021.

The March budget deficit is the third largest monthly deficit in U.S. history, making Uncle Sam the largest half-yearly deficit on record.

Before last year’s stimulus-fueled $ 3.13 trillion deficit, the U.S. government had run annual deficits of over $ 1 trillion just four times, all during the Great Recession. Uncle Sam is already on the fast track to $ 2 trillion with six months remaining in the fiscal year. The previous record deficit for the first six months of a fiscal year was $ 829 billion in 2011.

Uncle Sam spent nearly a trillion dollars in March. Last month’s $ 927.21 billion in spending brought total FY2021 spending to $ 3.41 trillion.

Meanwhile, treasury revenue in March amounted to just $ 267.61 billion. That was a 13% increase from last year, but it didn’t come close to covering the huge spending spree.

And keep in mind, we’re just beginning to see $ 1.9 trillion in American Rescue Act approved spending.

On March 1, the US national debt eclipsed $ 28 trillion for the first time. Currently, that represents $ 85,255 in debt for every American citizen.

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According to the National Debt Clock, the debt-to-GDP ratio stands at 130.02%. Despite the lack of concern in the mainstream, debt has consequences. Studies have shown that a debt-to-GDP ratio above 90% retards economic growth by about 30%. This casts cold water on the conventional ‘spend now, worry about debt later’ mantra, as well as the frequent claim that ‘we can get out of debt’ now popular on both sides of the world. went to Washington.

As Peter Schiff said in a tweet, all of this government comes at a price.

“We did not get $ 659 billion in government spending for free. The public will pay the balance through the inflation tax. This means that consumer prices are going much higher. “

The inflationary tax will hit us as the Federal Reserve monetizes this massive debt. This means more bond purchases and more money printing.

The Federal Reserve makes all of this borrowing and spending possible by supporting the bond and monetizing debt. The central bank buys US Treasuries on the open with money created from scratch (debt monetization). This creates an artificial demand for bonds and keeps interest rates low. All this new money is pumped into the economy, causing inflation to rise. We see this playing out before our eyes as the Fed continues to expand the money supply by record amounts.

The Fed itself had worked between a rock and a hard place. He must print billions of dollars to monetize massive deficits. But it blows up inflation expectations. This puts upward pressure on interest rates. But you can’t raise rates when your whole economy is on debt. The only way the Fed can keep rates low is to buy more bonds, which means printing more money, which means even more inflation. You can see the vicious cycle. At some point there is a fork and the Fed will have to choose. Speed ​​up and correct inflation and let rates rise, which will burst the stock bubble and collapse the debt-based economy, or just keep printing money and eventually crash the .

Disturbing footage shows a woman with infamous tattoos moving a baby through an airport.

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