I want to focus on how bond holders debt will be paid off. They have spent billions of dollars buying bonds that yield 2-3% p.a. and are due to be redeemed in 2 – 15 years. The banks happily process the debt and the governments will have to raise the money from taxpayers, thus sucking money from the public, reducing consumption, increasing unemployment and torpedoing economic recovery. Because of the large amount of the debt, repayment is likely to take many years with declining living standards. There would be a strong resistance to disposing of the debt in any other way.
The above is a simple explanation of a complex financing problem. Governments could minimise further debt and increase taxes to pay off the COVID-19 debt as quickly as possible. The graph shows personal versus corporate tax burden in the US in the past. The trends may have continued.
My blog has writing on how COVID-19 debt has been funded, government, development, growth and other topics.