-tax revenue-borrowing (from either American or foreign lenders)-creating money from the federal reserve Dr. Daniel Johnson, a professor of economics at Colorado College who specializes in public policy, says government spending comes from three sources: “How are we financing this particular stimulus package? Well, it’s a combination of those,” he explained.
The money was intended to help families, businesses, and local governments cover their most essential expenses and increase spending to support the economy. It started with the $2.2 trillion Cares Act, followed by the $900 billion Consolidated Appropriations Act, and finally the $1.9 trillion American Rescue Plan.
However, nearly everyone recently surveyed by KRDO Newschannel 13 didn’t know where that money came from. However, that money to individuals is only a small portion of the roughly $5 trillion in pandemic relief money approved by Congress since it began.
To support that, he points to unemployment and claims that many economists feared the pandemic could have easily created the type of unemployment not seen since the Great Depression, when unemployment hit nearly 25%. “We managed to battle the unemployment rate down from 15% this time last year to about 6% now. That is remarkable by any historical norm in any country.” However, Dr. Johnson isn’t so sure about that, saying, “I think it was wise, and I think the impact proves that.”
Because of that, many lawmakers in Washington and many of the citizens interviewed by KRDO believe the stimulus bills were too large. While the exact percentage of each source in the recent stimulus bills isn’t clear, it’s a certainty that the government will eventually have to pay it back.
The News Highlights
- Stimulus money: who is paying? – KRDO
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