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The bailout bill will not cure the “root cause” of the United States

The bailout bill will not cure the "root cause" of the United States

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December 22nd local time, U.S. President Trump refused to sign the congressional coronavirus relief bill and returned to “rewrite”. The day after months of debate, the House of Representatives and the Senate voted to approve the $900 billion new economic stimulus plan against the coronavirus epidemic.

As the country hardest hit by the coronavirus epidemic in the world, the bipartisan bailout negotiations in Congress have been delayed, resulting in the failure of the United States to introduce a new bailout bill.

Analysts believe that the bailout bill is too late, with business closures and people’s unemployment, and the U.S. economic recovery is still struggling.

The “taw war” is not over yet.

“I ask Congress to immediately remove wasteful and unnecessary items from this bill and to submit a proper bill to me or else the next administration will have to come up with another coronavirus relief package.” Trump said that if Congress did not provide the rescue plan he wanted, it would be left to the next administration.

At the same time, he remains unwilling to accept Biden’s victory, implying that his government may still be the “next government” and “Maybe that government will be me, and we will finish it.”

According to Fox News, Trump called the newly passed relief bill “disgraceful”. He believed that many of the money stipulated in the bill were used for foreign aid, and the relief funds given to his own people were too low.

He asked lawmakers to rewrite the bill to increase the relief payments to the American people from $600 to $200.

Subsequently, Speaker of the U.S. House of Representatives Pelosi said, “Republicans have repeatedly refused to disclose the amount of cash that the president wants. In the end, the president wanted to distribute $2,000 – Democrats agreed to put it to the vote this week. Let’s act!”

The U.S. government’s “tug-of-war” around the relief bill has not yet ended, but the number of confirmed cases of COVID-19 in the United States is still increasing significantly.

According to the real-time statistics released by Johns Hopkins University in the United States, as of 16:00 EDT on December 23, the number of confirmed cases of COVID-19 in the United States has exceeded 18.38 million, with a cumulative death of more than 320,000.

The total number of confirmed cases of COVID-19 in the United States increased by another 1 million in just four days, according to Johns Hopkins University, and from 14 million to 18 million, it was achieved at an average increase of 1 million cases per four to five days. If that growth continues, the number of confirmed cases in the United States is likely to exceed 20 million in the New Year.” The current average daily death toll from COVID-19 in the United States exceeds 2,655, which also breaks the previous record.

“I can’t see the light at the end of the tunnel”

The new bailout bill was originally intended to provide relief to families and businesses hit by the epidemic and help the U.S. economy survive this “cold winter”. But many economists criticized that the bill came too late and not strong enough to stimulate the economic recovery quickly.

The Associated Press reported on the 22nd that some American entrepreneurs welcomed the long-delayed rescue plan of Congress, but for thousands of enterprises that have failed or may soon fail, the bill came too late.

Since this spring, the epidemic has led to a continuous decrease in the number of customers eating and shopping, and many stores have closed down before the bailout bill is introduced.

The article points out, for example, that the American Restaurant Industry Association estimates that about 17% of restaurants in the United States are closed indefinitely or permanently, reaching 110,000. This is due to the limitation of business hours or capacity during the epidemic and the unwillingness of Americans to eat out.

The operations director of a hotel consulting firm in Maryland said that if the store had closed, it would not help.” We lost a lot of restaurants that didn’t have to close, and they couldn’t see the light at the end of the tunnel.”

According to the analysis of the U.S. Consumer News and Business Channel (CNBC), although the additional relief measures will provide some buffers for the U.S. economy, many economists believe that the new bailout bill is not strong enough and too late.

They pointed out that the relief bill does not include assistance to state and local governments, considering the large budget gap of these state and local governments and the future of new crises.

“The short-term nature of these reliefs underscores the need for further relief packages in place in the new Congress, as it is clearly not enough to keep the unemployed or small businesses alive until the pandemic ends,” said David Kelly, chief global strategist at JPMorgan Chase.

He also said that the United States “lack of further relief to state and local governments increases the possibility of further layoffs in the coming months.”

The Washington Post also quoted analysts as saying that even after the rescue bill is passed, it will not be possible to stimulate a strong economic recovery until the second half of 2021, but the rescue bill came too late to prevent the economy from slowing further this winter.

The New York Times believes that the bailout bill is smaller than many economists suggest to get the U.S. economy through the epidemic and ensure a strong recovery. It will not revive the hardest-hit industries, nor will it eliminate the loss of income of many families for months.

“New Signs of Stalling in U.S. Economic Recovery”

The number of first-time jobless claims in the United States has increased to 885,000, the highest level in three months, according to the latest data released by the U.S. Department of Labor on Thursday (December 17).

The employment situation has turned sharply downward, Americans begin to “tighten their belts” and the economic recovery is more difficult.

Scott Brown, chief economist of Raymond James Financial Corporation, said that the U.S. economy is still quite weak, and the rise in unemployment shows that the labor market is still weak.

At the same time, the American people’s spending on food, clothing, housing and transportation has decreased, which exceeds Bloomberg economists’ expectations.

“We are losing momentum at a critical moment.” Diane Swonk, chief economist of Junfu Accounting Firm, said that at a time when consumer spending should be increased to stimulate the economy, it has fallen back or slowed down because of the epidemic.

U.S. household spending fell for the first time in seven months in November, according to data from the U.S. Department of Commerce. The U.S. Department of Commerce said on the 23rd that after shopping spree this summer, consumers closed their wallets last month, and spending fell by 0.4%.

Household incomes have also been hit as the effect of the federal aid program implemented earlier this year has faded. Household incomes measuring American wages, return on investment and government assistance fell by 1.1%, the third decline in four months.” This is a worrying trend,” the article wrote.

In the latest wave of the pandemic, retail sales are weakening and corporate recruitment has decreased significantly as Americans become more and more anxious.

The U.S. tourism industry has lost a lot of business since March, and it has not recovered. Millions of companies have closed down. A new wave of the pandemic this fall prompted states and cities to order businesses to close or scale down operations.

At present, many American enterprises and families are struggling in the coming severe winter. Katie Anderson Ted, 35, is a mother of two who runs a candy store in Richmond, Illinois.

During the epidemic, the store has transferred most of its sales online. Anderson Ted estimates that sales fell by 20 to 30 percent this year, and the decline in sales also reduced her own income, which forced her and her husband to cut expenses.

In an article on the 24th, The Washington Post called Trump’s refusal to sign the bailout bill “a new sign of the stagnation of the U.S. economic recovery”.

The article said that millions of Americans have been waiting for months for aid to be unable to be implemented. At present, the outlook is uncertain for the overall economy of the United States and for many families. Trump’s latest move and the uncertain path ahead mean that up to 14 million Americans will lose unemployment assistance after Christmas.

“The spread of the virus and the related restrictions really hampered the recovery,” said Michael Pearstein, a senior U.S. economist at Kaitou Macro. You can give consumers cash, but if they are not confident or unable to spend in the economy, it will not be of great benefit to boost the economy in the short term.”

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