One of the key issues that the United States is currently facing is the recovery of its economy after the pandemic. Since the beginning of 2020, when the COVID-19 pandemic started, the country’s economy has shrunk by 3.5% (Bauer et al., 2020). It is considered to be an unprecedented crisis because the U.S. GDP has never experienced a drop greater than 3% since 1947 (Bauer et al., 2020). Currently, as the pandemic restrictions are gradually being eased, the economy is also expected to show signs of improvement.
President Biden, who was elected in November 2020, has already started to take measures to address the problem. In March 2021, the $1.9 trillion relief package was passed by Congress, which is expected to give a boost to the economy by enabling citizens to spend more money (Horsley, 2021). The economy is expected to grow by 6.5% this year, and the unemployment rate is expected to decline (Horsley, 2021). The country hopes for a rapid recovery triggered by a lift in economic activity.
However, there are debates on whether these measures will really prove to be effective. The critics say that they might stimulate the economy too much, overwhelm businesses, and trigger inflation, causing a rise in prices (Horsley, 2021). Besides, the pandemic is still raging, new mutations of COVID-19 appear, and mass vaccination has not yet been reached, which makes it difficult to make any accurate predictions. There are many negative factors that can potentially influence the economy in 2021. Overall, it can be concluded that with the current actions expected to provide short-term relief, the government needs to focus on long-term measures to support the economy and achieve stable growth.
References
Bauer, L., Broady, K., Edelberg, W., & O’Donnell, J. (2020). Ten facts about COVID-19 and the U.S. economy. Brookings.
Horsley, S. (2021). Biden’s $1,9 trillion rescue plan set to turbocharge U.S. economy. NPR.