Where will the US Get $2,000,000,000,000?

Where will Uncle Sam get $2,000,000,000,000?

A lot still has to be explained, but there remains one major fact that even the most elementary of economists knows: To shell out $2 trillion, the government is going to have to make something really big take place.

Here’s what we know about the agreement:
–$250 billion will be dispensed to individuals and families.
–$350 billion is earmarked for small businesses.
–$500 billion is allotted for hurting businesses and industries, including airlines, cruise ship operators and hotel companies.
–Americans who have lost their jobs due to COVID-19 can expect greater unemployment and healthcare benefits.
–Every adult will receive $1,200, plus $500 for each child, depending on the level of income.

This Is a Lot of Money, Not Petty Cash
Again, the question is: Where will the government get $2,000,000,000,000? This is not petty cash we’re talking about. This is big bucks. A lot of moolah. Mucho dinero.

Just how large is $2 trillion? Just think about it,

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A trillion has to be followed by 12 zeroes. Or, let’s say, a million million.

We have to ask ourselves this looming question again: Where will the $2 trillion come from?

The stimulus package does not call for taxes to be increased, so that leaves the government the alternatives of either borrowing more money or printing more money.
Plans are already underway to print more money. The Federal Reserve spokespersons call it “quantitative easing.” It is still unknown as to how much money will be printed. You can bet your watch and chain that it will be a lot.

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The remainder of the expenditures will be funded from borrowed money. Among the lenders will be some of our biggest creditors. Japan and China top the list. Others are Brazil, the United Kingdom and Ireland.

Stimulus Deal Adds to Growing National Debt
This new stimulus adds to our increasing national debt. It is believed by many economists that our national debt could reach $40 trillion within four years.

We, the public, have to understand the issues that accompany a stimulus deal of this magnitude.

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The speculation is that the blessings of a stimulus will put Americans back to work and spending more money. Personal incomes will be higher and the government will be able to collect more tax dollars to pay for this new, enormous debt.

Now, let’s look at this way: If the stimulus is funded with debt spread equally across the population. each of us will end up owing the government a certain amount in taxes. How much? If you divide two trillion by 253 million people over the age of 18, you get $8,000.

No taxes? In essence, you have just agreed to pay $8,000 in future taxes to help fund the stimulus agreement.

Eight thousand dollars!

Printing More Money Tends to Lead to Inflation
Now, let’s look at the option of printing more money. When we print more money, inflation enters the picture. Some of our purchasing power generated through the stimulus is lost and the value of our money is decreased.

The next ugly word is recession. The stimulus package should actually help us avoid a recession. Still, the nation will have more debt to be paid, and with dollars that have diminished in value.

The bottom line is that all that is coming our way via this stimulus package will be costly and should help the government avoid recession.

It may help avoid a recession, but in no way will it put us immediately on the road to the land of milk and honey.