BRIAN KANTOR: Money created from thin air behind governments’ stimulus plans
As borrowing soars, the US fiscal deficit is on track to be the country’s largest since World War 2
The world in peacetime has seen nothing like the surge in government spending, borrowing and money creation that is now under way, especially in the richer nations. Perhaps it is wrong to describe the world as being at peace. It is at war with a virus and, as in most wars, it is accompanied by warlike amounts of impenetrable fog, multiple snafus and much wealth destruction.
Yet there is no sign of taxpayer revolts over the spending propensities of their governments. The current spat between US Republicans and Democrats over additional spending is by no means asymptomatic. Congress and the president have already approved extra spending of $3.2-trillion. The Democrats have now proposed an extra $3.4-trillion of relief divided up their way. The Republican offer is another $1.1-trillion spent very differently. In the context of a $20-trillion economy, neither set of spending proposals is inconsequential.