Committee for a Responsible Federal Budget

Treasury Will Borrow $3 Trillion in Just Three Months

May 5, 2020 | Budgets & Projections

For Immediate Release

The Department of the Treasury yesterday estimated that the second quarter of 2020 will see a record-breaking $3 trillion in borrowing, as the country continues to combat the coronavirus (COVID-19) pandemic and related economic downturn. Below is a statement from Maya MacGuineas, president of the Committee for a Responsible Federal Budget:

It’s no secret that this year’s deficit and the national debt are going to reach historic levels, after Congress approved trillions of dollars in much-needed aid to help families and businesses harmed by this pandemic. Still, seeing Treasury confirm that the country will borrow $3 trillion in just a matter of months should serve as a warning against wasteful spending in future rounds of aid and remind us that the debt will have to be addressed once the economy has fully recovered.

The last thing we need is lawmakers using a national emergency to advocate for their unrelated pet projects. Yet that’s exactly what many in Congress and the administration have proposed, with $2 trillion in unpaid for infrastructure spending, “Tax Cuts 2.0,” a $10,000 per person reduction in student debt, and everything in between masquerading as fiscal relief for the pandemic. Politicians making these asks ought to answer for why they’d add to a $3 trillion surge in borrowing for things that don’t help us fight the virus or provide direct economic relief.

This crisis may require additional borrowing in the coming months. Public health and aid for those who have lost their job or businesses losing revenue through no fault of their own will take precedence over the challenge created by short-term borrowing.

However, this is a bright warning that the debt situation will not fix itself. To return to a position of strength, we will need to manage the pandemic, return the economy to a period of growth, and then bring our debt back down to manageable levels.

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For more information, please contact John Buhl, director of media relations, at buhl@crfb.org