The U.S. budget deficit swelled to new record highs at the beginning of the year as the government pumped money into direct payments to Americans and other efforts to prop up the coronavirus pandemic-stricken economy.
The gap between government spending and revenue rose to $736 billion in the first four months of the 2021 fiscal year, the Treasury Department said Wednesday afternoon in its latest budget report .
That was nearly 90% higher than the $389 billion deficit reported for the same period last year.
The historic increase in the national debt is likely to fuel Republican criticism of a $1.9 trillion economic relief package proposed by President Joe Biden, which would fund additional stimulus checks, unemployment benefits, vaccines and other Covid-19-related measures.
The budget deficit rose to $163 billion in January, a new record for that month and sharply up from $33 billion a year earlier. As part of the $900 billion round of stimulus passed at the end of 2020, the government began to send out $600 stimulus checks to Americans last month. According to the Treasury Department, the government disbursed $139 billion of those checks in January.
What To Watch For
Congressional Democrats used a procedural device last week that cleared the way for the party to advance the economic relief package without Republican support. While Republicans and some economists have expressed alarm about the effects of the bill on the national debt and inflation, Biden has found support for his plan among foreign leaders and domestic policymakers. On Wednesday, Federal Reserve chairman Jay Powell said that the focus should currently be on the needs of the economy rather than the national debt.
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U.S. Budget Deficit Soars To Record $736 Billion As Government Pumps Money Into Stimulus Checks have 425 words, post on www.forbes.com at February 10, 2021. This is cached page on VietNam Breaking News. If you want remove this page, please contact us.