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Economic retreat creates new hurdle for Democrats in 2022

The strength of the recovery from the coronavirus recession is waning at a dangerous time for President BidenJoe BidenGruden resigns as Raiders coach after further emails reveal homophobic, sexist comments Abbott bans vaccine mandates from any “unit in Texas” Jill Biden to advertise McAuliffe on Friday MORE and democrats.

White House and Democratic lawmakers face a growing number of challenges to Biden’s pledge to “rebuild better” from the depths of the COVID-19 pandemic as the party prepares for discouraging mid-term elections.

A summer resurgence of the virus, tangled supply chains, rising prices, and a slower-than-expected recovery in the labor market have led economic forecasts to lower their growth forecasts this year and next.

The International Monetary Fund (IMF) predicts the US economy has grown 1 percentage point slower this year than expected in July, according to new forecasts released on Tuesday.

US growth is forecast to slow to 6 percent this year, compared to the IMF’s July estimate of 7 percent.

“The global recovery continues, but the momentum has weakened, hampered by the pandemic,” wrote IMF chief economist Gita Gopinath.

“Pandemic outbreaks in critical links in global supply chains have resulted in longer than expected supply disruptions and fueled inflation in many countries. Overall, the risks to the economic outlook have increased and the political compromises have become more complex. “

While the IMF expects some of this year’s loss of growth to occur in 2022, other economists see a grim path for the US.

Goldman Sachs economists said this week they expect the U.S. economy to grow 5.6 percent in 2021 – 0.1 percentage points less than an earlier estimate. They expect growth to slow to 4 percent in 2022, down from an original estimate of 4.3 percent.

And the Federal Reserve of Atlanta’s estimate for annualized third-quarter growth fell from just over 6 percent on July 28th to 1.3 percent last week.

While growth is expected to remain well above pre-pandemic levels through 2022, the double force of slowed growth and persistently high inflation, even with the downgrades being driven by the COVID-19 delta variant, could pose tough hurdles for Bidens Be an agenda.

Democrats are struggling to compromise Biden’s trillion-dollar social services and climate bill, progressive lawmakers – who reluctantly agreed to drop below the original $ 3.5 trillion base – and Democratic Satisfy Sens. Joe ManchinJoe ManchinUsing common principles to lead our global and national energy policies, Sinema’s office denies report that it has $ 0 billion (W.Va.) and Kyrsten cinemaKyrsten SinemaSinema’s office denies report that it plans to cut climate spending by $ 0 billion Juan Williams: Women have power The memo: Biden’s horizon is clouded by doubts MORE (Ariz.) With their demands for steep cuts. The fate of a separate bipartisan infrastructure bill is tied to the larger Democratic bill, much to the annoyance of moderate lawmakers from purple counties, who are likely to face serious Republican challenges in 2022.

The White House and Congress also face an impending fiscal cliff in early December, as both state funding and the country’s ability to borrow money will expire on December 3rd.

Whether Biden can lead his plans through Congress is largely determined by political considerations within the Democratic Party, including the moderately-progressive gap and the strategy most likely to help Democrats maintain control of Congress.

The uncertainty surrounding the economy, however, could add a wild card to the mix as Biden tries to cement a message of success for 2022.

Republicans have tried to attribute Biden’s ambitious spending plans and handling of the pandemic to decades of high inflation, recruitment problems and other hurdles to recovery. While many other wealthy nations have faced similar problems in their recoveries from the pandemic, GOP lawmakers have tied the speed limits to Biden with a view to a Congressional majority.

“America’s families are feeling the power of their paychecks dwindling day by day. Workers struggle to find jobs that match their skills and companies struggle to find willing workers, ”said Sen. Mike LeeMichael (Mike) Shumway LeeMcConnell vows GOP won’t help raise debt ceiling in December after Schumer’s Senate negotiates a deal to vote to raise the debt ceiling (R-Utah), vice chairman of the Joint Economic Committee, in a statement Friday following the September employment report.

“Our economy is still recovering. Now is one of the worst times for massive new tax hikes and inflationary spending. Instead, Congress should have policies that allow more Americans to get back to work. “

Democrats have been countering for months that the adoption of an ambitious infrastructure and social plan is essential to address both the damage caused by the pandemic and long-term structural problems.

Proponents of Biden’s Agenda say the recent economic weakness is an example of why Democrats must come together to pass the sweeping budget measure.

“The latest Job Report showed what many economists have been saying all along – that this is primarily a public health crisis and that the Delta variant stalled labor market recovery in August and September,” wrote Kate Bahn , Interim Chief Economist and Director of Labor Policy at the Washington Center for Equitable Growth, in an email.

Employment growth has declined sharply in the past two months, falling from an increase of 1 million in July to 366,000 in August and 194,000 in September, mainly due to the increase in coronavirus cases. While the unemployment rate fell 0.4 percentage points to a pandemic low of 4.8 percent, the labor force participation of women fell sharply as closed schools and other care tasks flooded the workforce by gender.

“Build Back Better’s features, which center the myriad of care benefits families need at the same time – such as child tax deduction, paid vacation and accessible childcare – confirm that care is the backbone of the economy,” wrote Bahn.

“Rebuilding the economy requires families to be able to provide for themselves and others before they can fully engage in the labor market.”

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