After the spike of Covid cases hit in the U.S. last March, the nation went through a lockdown in order to keep everyone safe. During this time, restaurants and many businesses were forced to shut down which caused an economic crisis.
America is currently going through the largest economic recession since the Great Depression, so you can imagine that there is a lot of pressure on the Biden administration and their plain of attack to build a strong, healthy economy which includes all Americans.
One of the first steps taken by the Federal Reserve was to lower interest rates which will encourage lending and boost economic growth. This is what is known as fiscal policy- a liberal approach to economics where the Federal government is responsible for the balance of the economy, and must create the right leave of demand. So when that demand is low, it is up to the government to put more money into the economy.
“Many conservative-sided people will argue that this is a very socialist concept, but in reality this is just a way to ensure that all citizens are taken into account and protected. Many low-wage workers have lost so much due to the pandemic, and how the Trump administration dealt with it. By reimbursing them, it will help recover from the tragedy of the pandemic, ” says Senior Kate Healy.
We can see the ways in which fiscal policy is present in our current economic state. More government spending allows for more money to enter the economy, and the best way to go about that is by putting money into the citizens’ hands. With the vaccine becoming more acquirable and places starting to reopen, we can predict that a majority of stimulus checks will be spent, allowing that money to re-enter the economy.
There is a lot of work ahead of the Biden administration and it is going to take a great amount of effort to ensure that all American citizens are protected, especially low wage workers- which a lot of focus has been directed towards. The future of the American economy is uncertain but we have faith in the recovery.
