WASHINGTON – The U.S. economy will bounce back to its pre-pandemic size by the middle of the year without any emergency stimulus, the U.S. Congressional Budget Office predicted Monday.
The report throws a monkey key at President Biden’s push to pass a huge $ 1.9 billion bailout plan ahead of a meeting with ten Republican lawmakers in the White House on Monday night after presenting their own modest proposal.
The impartial federal agency sketches an optimistic forecast after a year-long battle with the coronavirus that killed 441,000 Americans, left millions out of work and shut down large parts of the U.S. economy.
According to the office, the gross domestic product will return to pre-pandemic levels by mid-2021 and will continue to grow until 2026, as a vaccine reduces the number of new infections and the need for social distance.
‘The labor market conditions are still improving. As the economy expands, many people rejoin the civilian workforce that left it during the pandemic, and recover it to pre-pandemic size again in 2022, ”the report reads.
“The unemployment rate is gradually declining throughout the period, and the number of people employed is returning to its pre-pandemic level in 2024,” it continues.
The Biden administration last month unveiled a $ 1.9 billion bailout package as its first major legislative effort, with the unemployment rate at about 6.7 percent.
The package includes $ 1,400 stimulus checks for qualifying Americans, $ 20 billion for a national vaccination program and is believed to halve child poverty.
But many Conservatives and Democratic Sen. Joe Manchin of West Virginia, a key voter, called for such a large package to be passed on the heels of a $ 900 billion bill passed by Congress, with the argument that it will contribute to the balloon level of national debt.
White House spokesman Jen Psaki dismissed criticism of Biden’s package at a news conference on Monday, saying it was backed by other economic authorities.
“A new report from the Brookings Institution estimates that with the US bailout plan, we will increase GDP by 4 percent and bring our economy back to pre-COVID levels by the end of 2021,” Psaki said.
“A separate analysis by Moody’s Analytics found that the president’s plan would create 7.5 million jobs,” she said.