Introduction
In December 2020, economists were predicting that there would be a huge decline in GDP in early-2021. This was based on the surging numbers of new COVID-19 infections. Nonetheless, economic stability was observed in January and February, and this has in part been propelled by significant consumer spending. This is a mark of confidence that has been imbued by the governmental relief aid, the noteworthy decline in new daily COVID-19 cases, and the rollout of the vaccines (Davidson). Herd immunity is expected to have occurred by mid-2021, and governments at all levels will have lifted most of the restrictions.
A significant number of economists expect as much as 7% economic growth in 2021. This is unprecedented as it never even happened following the Great Recession of 2007 to 2009. The massive stimulus packages are believed to have helped in boosting spending. Together, the $900 billion packages that were passed in December and the new $1.9 trillion one will ultimately result in Americans having $1.5 trillion to spend. So far, remarkable spending on cars, clothing, appliances, and the future has been witnessed. The overall sales for January 2021 rose by 5.3% (Davidson). If the trend continues, experts suggest that the gross domestic output will be a lot bigger than it would have been the case without the COVID-19 pandemic.
The daily cases of new COVID-19 infections declined from an average of 250,000 in January to 68,000 by mid-February. This translated into a reduced number of hospitalizations throughout the country. The positive news had an effect on people’s behavior, particularly because they also had money to spend. They were emboldened to visit eateries and other retail outlets, and indeed, a number of states and cities have been prompted to ease the restrictions. Bars and restaurants had an average revenue increase of 6.9% in January. This trend will continue because, like Morgan Stanley, the disposable finances will have increased to $2 trillion by March (Davidson). In essence, decreased fear, access to money, and eased governmental restrictions are bound to spur growth.
Gregory Daco indicates that there are challenges ahead, and these include the long-lasting effects of lost businesses, unemployment, and the possibility of people dropping out of the labor force completely. Individuals, private establishments, and governments have a role to play in facilitating job creation in new fields and spheres. There should be federal assistance targeting a broad range of areas (Davidson). Research on vaccines and medication should continue, especially to counter the new contagious virus variants being reported.
Impacts of Article
Introduction
At the time when the first human case of COVID-19 was reported in December 2019, its social, political, financial, and economic impacts were unknown. The negative consequences became apparent as the disease started spreading throughout the world. During the initial stages, and considering that it was an unknown disease, with no vaccine and reliable medication lacked, there was significant panic across the world. Individuals started isolating themselves even before governments instituted lockdowns and other measures to limit intermingling. Indeed, they were looking up to their governments to provide pertinent information on how they could keep themselves, relatives, and friends safe.
Although they were acting in good faith, some governments sought to reassure their citizens that the outbreak was manageable. That was not really the case at the time, as there was a need to undertake in-depth research studies to understand the disease. Valuable time and opportunities were lost in early 2020 because the need for testing and contact tracing were largely ignored. The confidence that people had in their governments’ ability to handle the challenge waned as it became a full-blown pandemic. With time, there was a lot of skepticism as to whether the economy will ever recover and if normality will resume. According to Davidson, experts had expected challenges to worsen in 2021. This article, therefore, makes the audience hopeful that recovery is likely to happen soon.
Social Perspective
Risk perception had already caused a significant change in people’s social life, and this was before governments-imposed restrictions. Individuals started showing reluctance to mingle as freely as they did before December 2019, and this is understandable, bearing in mind that physical proximity increases the risk of transmitting the disease. Corona-phobia has led to a remarkable impairment to daily life, with many people showing signs of crowd anxiety (Davidson). Sharing physical spaces, particularly with strangers, is a matter of concern, and some have preferred isolation to endanger themselves.
The subsequent lockdowns have meant that individuals cannot meet and socialize with their friends, that is, even if they believed they could take the necessary precautions. Consequently, restrictions result in mental and psychological distress, a scenario that will have long-term consequences. For example, it has been noted that some of the people who were vibrant, innately motivated, and ambitious are no longer willing to remain as part of the labor force. Hesitation is even more pronounced for those required to acquire new skills and to start recently developed careers.
Apparently, the upheaval triggered by COVID-19 has made individuals become pessimistic about life itself. A significant number of them feel as if they must relearn everything they thought they knew. Such a person may not be as socially and emotionally balanced as they were before the pandemic started. The sentiments of Davidson are encouraging, and those who contemplate them are likely to be inspired to start perceiving life positively again. In essence, there is hope, and the government has indicated its willingness to help the citizens persevere in the challenge.
Political Perspective
Just as COVID-19 has disrupted individuals’ social life, it has disturbed their political views as well. First of all, leaders at all levels of government were and are still being blamed for mishandling the crisis. Some of the accusations are true, although others are caused and/or heightened by frustrations. Moreover, the anxiety has made people fiery, and this is particularly when it is compounded by lockdowns. For example, when those who had lost their jobs were told over and over again that the government was to blame, they were convinced. The vaccines had not been developed, and hence there was considerable uncertainty as to when millions of struggling Americans would be gainfully employed again.
At a time of crisis, people tend to look for leaders who would make decisive changes. A significant number of Americans did not see that in their current leaders, and besides, there was hostility between the Trump administration and the media. The continuously negative media reports firmly established the view that the federal government had not just failed but also lacked a plan to bring the society back to normality. This was depressing, and Americans felt helpless because COVID-19 had affected them personally (Davidson). Having relatives, friends, and neighbors who had lost their lives and others without the means of livelihood made the experiences personal. Changes in leadership were conceivable, and it is probable that the Democrats won the Presidency, the House of Representatives, and the Senate because the Americans believed the Republicans had let them down.
Financial Perspective
With over 20 million people out of work at the height of the crisis, Americans were facing serious financial challenges. Roughly a third of all citizens maintain no savings, and hence any emergency always leaves them in a vulnerable situation. Therefore, the COVID-19 pandemic has been particularly derailing for those who were already struggling with low wages before the crisis. Indeed, this is why experts argue that the inequality was exacerbated. There had been a lot of anxiety when it appeared as if the problem would last at least until 2023. Nevertheless, Davidson argues that the current indicators depict a different scenario, and this is because recovery is expected in 2021 (Davidson). This momentum is noteworthy because when the crisis happens, it often takes several years (sometimes even decades) to reach the pre-disaster levels.
The stimulus packages, unemployment benefits for millions of Americans, and increased federal supplements have led to trillions of dollars being availed to individuals across the country. They are now confident about spending this money, and with views such as those expressed by Davidson, people can be hopeful that there will be numerous job openings in 2021 and beyond. Indeed, fast growth is being predicted, and economists also indicate the likelihood of employers increasing the wages in order to attract qualified personnel. This development will mean that Americans will be empowered to meet not just the basics but also other things they may want. Individuals and families can now make plans for the future with the belief that they can afford to meet those objectives.
Economic Perspective
Although economists have predicted an economic recovery and a high growth rate, some argue that it could trigger a recession. This is in part due to the amount of money the government is availing to the citizens and the high wages companies are likely to start paying when job opportunities increase. It is noteworthy that the rate of unemployment is falling in an unprecedented degree (Davidson). People could be employed and earning wages higher than was the case before the crisis and still not be in a position to secure their needs.
Economists insist that the government should continue offering more stimulus packages. Gregory Daco argues that, indeed, about $2 trillion should be allocated to long-term spending on not just the areas which have been most affected by the pandemic but also on climate change and infrastructure as well (Davidson). The argument has a credible basis because the stakeholders are not trying to simply return to the situation as it was before December 2019. Besides, the world will be transformed by the pandemic, and for example, some jobs will disappear as others are emerging. Considering that America is a capitalist economy, and it is difficult to tell what those new jobs will entail, it is imperative to spur economic growth through infrastructural development.
Just like is the case with the other stakeholders, the government has a role to play in sustaining economic growth. Davidson suggests that the government is able and willing to step in with federal assistance, particularly for those who wish to shift their career lines. This is important as some of the jobs may never be recovered. Economies around the world are undergoing transformation, and Americans must not spend resources, time, and effort trying to return to the traditional model.
Conclusions and Recommendations
Conclusions
The initial predictions were that the social and economic derailments caused by COVID-19 would continue, at least for a few years. Indeed, economists hardly expected that a significant recovery would be achieved in 2021. Nonetheless, the situation has changed a lot quicker than it was anticipated. Davidson argues that in a few months, it is probable to have economic growth, which is higher than it would have been the case had the pandemic never occurred. Nonetheless, this success will have been achieved as a result of the governmental efforts to lessen the impact of the crisis. Americans are now hopeful about the future even though some traditional aspects of life and work may change, particularly with the emergence of new careers.
There have been two stimulus packages already, and more initiatives are being planned still. It has been determined that these measures are important, especially considering that millions of Americans have been out of work for a significant period of time. The government’s effort to facilitate them with a means of livelihood is imperative. Authorities have started to ease the lockdowns, and this is informed by the fact that vaccines have been developed and they are being rolled out successfully (Davidson). The infection rate is also declining, and Americans are confident about venturing outside. This trend will help restaurants and other businesses to increase their sales. Therefore, it seems likely that a sense of social and economic normality will resume in 2021.
Recommendations
The government should continue supporting the citizens and private businesses until the crisis is resolved. If this is not the case, a significant number of Americans may suffer from depression and anxiety, and their social lives, as well as the capacity to work, could be compromised. The citizens should always be convinced that the government cares about them and that those in authority are doing everything possible to cushion them from the setback.
The government and those in positions of influence should continue to encourage the citizens to get vaccinated. This process will accelerate herd immunity and make it possible to lift almost all restrictions. The length of time it takes for Americans to get inoculated is directly proportional to the duration that will elapse before it is safe to resume normal day-to-day activities. Everyone should understand that it is mutually beneficial to undergo this process as soon as possible.
A significant number of Americans are hesitant about changing their careers, and particularly so due to the way the current crisis has been depressing. Nevertheless, changes are bound to happen, and it is erroneous to resist rather than embrace them. There is a need for federal assistance, and other stakeholders with resources and know-how ought to offer their assistance. If all parties work harmoniously, the economic, financial, political, and social impact of the pandemic would be mitigated.
Works Cited
Davidson, Paul. ‘Remarkable outcome’: Big gains are likely for the economy this year even as COVID-19 damage lingers. USA Today, Web.