Republicans claim that they are the party of fiscal conservatism, but are they? U.S. Treasury Secretary Steven Mnuchin has jetted around the world on the taxpayers’ dime and takes pictures with his wife, both swaddled in paper money. This is the big lie.
Mnuchin claimed that handing out the big bucks to major corporations and the top 100 richest people in the country would boost the economy. This is called trickle-down economics.
The Treasury secretary had no trouble borrowing the highest amount ever in the first quarter, $488 billion. Yet, he basically said, “trust me.” He told reporters that treasury markets are able to “handle a lot of supply.”
Unfortunately, the Congressional Budget Office (CBO) anticipates that the national deficit will rise to $1 trillion by 2020.
Senator Mark Warner (D-VA) said it was time to be honest with American people, according to CNBC:
‘Today, over a year into the Trump presidency and after 90 consecutive months of job growth, the economy is in good shape overall, but our fiscal picture is in its worst shape since World War II.’
The senator continued, saying that the Republicans were using the national “debt as a political weapon:”
‘Congress has consistently failed to deal with this reality. Worse, many of our nation’s leaders simply use the debt as a political weapon — an easy excuse to oppose the other party’s priorities, when convenient.’
Trickle-down economics never worked for President Ronald Reagan (R) or President George W. Bush. That is because it has a huge flaw – neither rich people nor corporations want to hand out their profits to the workers in this nation.
The age of companies being loyal to their employees has long passed. They want to take in every cent possible, cut every corner, and squeeze as much work out of as few people as possible.
Yet, Mnuchin said he was not worried about the bond market being able to absorb this huge debt. He told Bloomberg TV:
‘It’s a very large, robust market — it’s the most liquid market in the world, and there is a lot of supply. But I think the market can easily handle it.’
The Donald Trump administration borrowed around $47 billion more than it estimated from January through March.
The end-of-March cash balance was $290 billion, compared with an initial estimate of $210 billion.
When Bloomberg asked Mnuchin about risks in a declining demand for Treasury bonds and the increased supply, he said:
‘By definition supply and demand will equate’I’m not concerned about that. I think that there are still a lot of buyers for U.S. Treasuries.’
The country has to issue more Treasury bonds as the financial health of the country declines. Already, the budget deficit zoomed to $600 billion just halfway into the fiscal year. That number will move up to $804 billion this year.
What that means is that under Trump, the country is spending three times faster than revenue has been growing for October through March of this year.
Mnuchin released another statement that read tax changes:
‘(Are) poised to underpin near-term consumption and investment (and) the stage is set for a pick-up in growth over the near term.’
The Treasury will issue $75 billion in net marketable debt in the period of April through June.
Featured Image via Getty Images.