The US says that due to the Corona-related relief package, its budget has increased significantly and it will have to take a record $ 30 trillion loan in the second quarter.
Before this, it is five times more than the money taken in any quarter. Earlier, most loans were needed during the financial crisis of 2008. With this, the debt of the US government has reached 250 trillion.
In the year 2019, America took a loan of $ 12.8 trillion.
To provide relief to health services and people directly, the US has approved a relief package of 30 trillion dollars.
According to an estimate, this relief package is up to 14 percent of the country’s economy. Due to the Corona epidemic, the government has extended the date of tax collection from April 15, due to which the government has been put on the additional burden.
To deal with the new crisis, America will now need an estimated 30 trillion dollars, which is much higher than the previous estimate of the government.
However, many Republican party leaders have expressed concern about the burden on the total debt of America in the context of additional expenditure.
America is going to take this loan by selling government bonds. Even before the crisis of Coronavirus, there was a lot of debt over the country. Many economists have described it as risky for future development and have said that more expenditure is being spent than income.
The budget office of the US Parliament had estimated last month that the fiscal deficit is going to reach 37 trillion this year and the debt on the US will be one hundred percent of its GDP.
Jerome Powell, president of the Central Bank of America, has said that spending needs to be done at the moment to handle the economy because the lockdown has taken away the jobs of 30 million people.
“More help will be needed from our side to handle the economy and get it back on track.”
Investors from outside countries are partners in loans to America. Japan, China, and Britain are at the forefront.
The growing tension between the US and China has affected the US debt situation in recent years.
According to the Washington Post last week, Trump administration officials have talked about canceling the loan from China, but Trump reportedly does not agree with the idea. They say that you will start it but it will be difficult.
Alan Blinder, professor of economics and public policy at Princeton University, told the BBC that investors were interested in lending to the United States because of the persistently low-interest rate. If everything remains fine, how much debt can Americans take, and as long as investors do not feel any risk to give loans to America.