![]() That bottom-up approach also makes sense top-down, looking at the economy as a whole and the challenges that yesterday’s CBO report laid bare: a labor market that is projected to recover too slowly and economic output that fails to get back to pre-pandemic expectations soon enough. In designing the American Rescue Plan, President Biden tasked his team with building a bottom-up plan that provides resources for our highest priority needs: getting shots in arms, opening schools, and providing relief to the workers, families, and small businesses that need it most. The Economics of the American Rescue Plan The COVID-19 pandemic and related economic crisis have brought tens of millions of Americans to the brink of financial ruin through no fault of their own. In addition, more than 15 million adults are behind on rental payments, nearly 24 million adults - and as many as 12 million children - are struggling with food insecurity, and more than 80 million adults are having trouble covering usual household expenses. These job losses have been concentrated among lower wage workers. More than 2 million women have left the labor force, many in the wake of school closures and challenges with child care. Almost a year into the pandemic, almost 11 million workers remain unemployed and around 4 million have been unemployed for six months or longer. In addition to CBO’s macroeconomic estimates of when the economy will return to pre-pandemic employment and growth trends, the current crisis is generating deeply inequitable outcomes for American families. The Pandemic’s Toll on American Workers and Families That’s dire – and a call to immediate action, not calm, not wait-and-see. But in fact, what the CBO is projecting is dire: around 7 million people out of work in 2021 whom CBO thought before the pandemic would be working. Some people took the CBO’s projections for growth in 2021 as a sign that we can wait to see whether additional fiscal relief is needed. CBO’s forecasts include the December relief package but not President Biden’s proposed American Relief Plan. While the CBO forecasts that growth in gross domestic output will rebound in 2021, back up to 3.7 percent for the year, that pace would not-absent additional action-return GDP to potential until 2025. The projections on economic growth relative to the beginning of the pandemic also underscore the urgency of additional action. This means millions would be unemployed for years after the health threat has lessened, unless we take action. On Monday, the Congressional Budget Office (CBO) projected that without additional government spending, the unemployment rate will remain above its pre-pandemic projections until 2024. President Biden’s top economic priority is to get to the other side of this crisis by ramping up the production and distribution of the vaccine, supporting businesses and households that need it most, and launching an inclusive, equitable recovery. ![]() The greatest threat to the United States economy continues to be containing the spread of Covid-19. Get Involved Show submenu for “Get Involved””īy Council of Economic Advisers Members Jared Bernstein and Heather Boushey.The White House Show submenu for “The White House””.Office of the United States Trade Representative.Office of Science and Technology Policy. ![]() Executive Offices Show submenu for “Executive Offices””.Administration Show submenu for “Administration””.
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