As debt climbs to record $27 trillion, Congress says it's not time to turn off stimulus spending
'Now's not the time to turn off the faucet when, you know, we should be using our strong balance sheet to borrow to stimulate the economy' - California Democratic Rep. Scott Peters
As the national debt approaches $27 trillion, Congress says federal stimulus spending must continue due to the pandemic.
The government spent $864 billion more than it took in during June, bringing the deficit to a record $2.7 trillion so far this year.
According to Treasury Department data, the debt held by the public is $20.6 trillion and the total outstanding national debt is more than $26.5 trillion. In 2019, the U.S. Gross Domestic Product, the total size of the economy, was about $21.4 trillion.
Kentucky Republican Rep. Thomas Massie told Just the News in June that he thinks the national debt will hit $40 trillion by the end of the coronavirus pandemic. Some experts have predicted that the debt held by the public will soon exceed the nation's entire GDP.
Fellow Republican Sen. Mitch McConnell, the Senate majority leader, has suggested that propping up the economy with more stimulus spending is an immediate priority. Treasury Secretary Steve Mnuchin has taken a similar position.
Despite the rising deficit, a fourth coronavirus stimulus package is being crafted in the GOP-led Senate after the Democratic-led House passed the $3 trillion HEROES Act in May. McConnell has said that any additional coronavirus stimulus package that passes in the Senate would be the last one. A formal proposal has not been released yet.
Members of the New Democrat Coalition, which includes Democratic lawmakers who advocate for fiscally responsible policies, were asked if they are going to insist that new spending is offset by spending reductions.
“I think what we've seen over the course of this pandemic is a recognition that this is an emergency and that getting bogged down in trying to identify offsets is not appropriate during an emergency,” Washington Rep. Derek Kilmer, the coalition chairman, said on Monday during a conference call.
“We need to have targeted spending to address what is the largest public health crisis over the course of, you know, modern history and perhaps the largest economic disruption or most assuredly the largest economic disruption since the Great Depression,” he also said.
California Rep. Scott Peters, another coalition member, said lawmakers should continue new stimulus spending into the next session of Congress, despite the record size of the debt and deficit.
“Now's not the time to turn off the faucet when, you know, we should be using our strong balance sheet to borrow to stimulate the economy, and that may involve more programs like climate and transportation going into the Biden administration,” he said.
Peters referenced a letter he wrote to House Speaker Nancy Pelosi in June and said he would like to see a future stimulus package include “a physical state of the nation report or a better debt-ceiling target” to help Congress address the nation’s fiscal situation sometime in the future.
“The idea is not to turn off the stimulus now but to make sure that when times get better that we will all come together and address the issue in a serious way,” he said.