A $1.9 trillion additional relief package is expected to pass this week. This is in addition to already unprecedented spending. The US went deeper into debt than other countries this past year. The chart above shows the fiscal balance, spending minus revenue, as a percent of GDP for some rich countries, the advanced country average, and the position of emerging markets from 2000 to 2020. It shows the US government has not held back, spending far more than European countries on the pandemic. The chart does not include the new stimulus. This should raise concerns about how much longer America's debt will be seen as risk-free.
Allison Schrager is a senior fellow at the Manhattan Institute. Follow her on Twitter here.
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