What has been will be again, what has been done will be done again; there is nothing new under the sun.~Ecclesiastes 1:9
The above chart shows the fiscal and monetary response by the US government and Fed to the Covid-19 “scamdemic”.
This is from the great website run by the “Committee for a Responsible Federal Budget”.
Regardless of what one thinks vis-a-vis the pandemic, large sums of money are being spent to compensate for the economic damage done to the economy by the government’s reaction.
Ask yourself a question, where is the money coming from for all of this spending? What are the repercussions of cramming $6 trillion dollars into a $22 trillion per year economy? Will this create inflation? What about the debt?
Great article at Manhattan Contrarian talking about what happened in Venezuela when they tried to print money and spend it without considering the consequences.
U.S. Gets Ready To Go Full Venezuela On Economic Policy
It was in 1998 — a mere 23 years ago — that Hugo Chavez first got elected President of Venezuela. From the start, his program was explicitly one of vastly increased government spending, which was supposed to make the economy grow, reduce income inequality, eliminate poverty and bring about social justice. Chavez called the social programs his “Bolivarian missions.” Among some 30 or so such “missions,” big ones included blowout spending on education, subsidized food, subsidized housing and healthcare.
In the early years, things seemed to be going swimmingly, at least if you believed the official statistics put out by Chavez’s government. Not only was there supposedly steady and mostly rapid economic growth (often over 5% per year, particularly 2004-10), but they also regularly crowed about how the redistributionist spending had greatly reduced the rate of poverty. Then, starting around 2013, it all started to fall apart. Today, eight years later, it continues to fall apart.
Yesterday, the Biden White House put out what they call the “American Jobs Plan.” It’s $2.3 trillion of new government spending, on top of the $1.9 trillion just passed, and several trillion more to come, all on top of a $4 trillion or so annual level of baseline federal spending. Yes, it’s blowout government spending, on the usual issues pushed by advocacy groups, which supposedly will shortly achieve all the usual promises of the left: economic growth, increased economic fairness, and social justice. In other words, it’s the Venezuela economic program, blown up to U.S. scale and then tweaked a little here and there to buy off the squeaky wheels of the moment.
This all going to end very badly as history has shown time and again. The initial sugar rush will feel good and everyone will be under the illusion that this is a great policy to follow. Eventually the chickens come home to roost and the piper will be paid.
If history is a guide and these policies are continued then look forward to inflation, falling dollar, lower living standards, more government intervention into the economy to fix their previous stupidities, and eventually social and political turmoil.
You have to work if you want to eat. There is no free lunch and the government can’t be your daddy no matter how appealing it sounds.