The Biden Covid plan must work. The economy depends on it

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Although the development of vaccines has occurred faster than many expected, the release is finally on schedule, partly due to the major chaotic shift in the midst of the worst pandemic in a century.

“We will not see a strong economic recovery until we get widespread distribution of the vaccine,” said Kristina Hooper, Invesco’s chief global strategist.

Kevin Hassett, a former economic adviser to President Trump, told CNN Business that the U.S. economy is facing a “negative spin” that could make GDP contract sharply in the first quarter, just as which was last year.
The pandemic has killed more than 400,000 Americans and U.S. health officials warn that the death toll could reach 508,000 by mid-February.
Rochelle Walensky, the new director of the Centers for Disease Control and Prevention, told NBC on Thursday that she does not believe that vaccines will be available in all pharmacies in America before February, despite such predictions by Trump officials . Biden aims to dispense 100 million doses in the first 100 days – and a CDC official said that is still the plan.

Danger of ‘stop out’

Time is of the essence as health restrictions and voluntary measures by Americans are pushing virus-sensitive parts of the economy, especially the service sector.

As can be seen by CNN’s business recovery dashboard, box office sales, domestic air travel and hotel ownership are all well below pre-crisis levels.

Millions of people who have had jobs rely on restaurants, bars, hair salons, dry cleaners, movie theaters, tour lines, hotels and countless other businesses. The Index back to normal, designed by CNN Business and Moody’s Analytics, shows that the U.S. economy is operating at just 81% of what it was in early March.

“The next phase of the recovery needs to be led by the service sector. Without it, we are going to stop,” said Aneta Markowska, chief financial economist at Jefferies. “You can’t reopen the service department without putting the pandemic behind us.”

‘Vaccination needs to get here’

George Harman, of Winchester, Virginia, the father of two, has severely cut spending since he went on unpaid leave from his job at a car dealer in early December. Harman stopped working because he feared his elderly parents living with him would become ill.

“I could go to work physically, but is it worth it to die or infect someone in my house?” said Harman, who has a history of heart disease.

Like countless other Americans, Harman does not deserve unemployment and runs low on money.

“The vaccine needs to get here,” he said. “If my parents can get the vaccine, I can put it at risk at that point. But I can’t get into a place where I know the virus has spread quickly and then take it home. ”

Exclusive: Trump economist backs $ 1.9 trillion Biden rescue plan
Biden plans to sign a series of action orders on Friday aimed at helping people in need, including a step that could help people in a situation similar to Harman ‘s. The White House said Biden would ask the Department of Labor to consider clarification that workers who refuse an unsafe working condition can get unemployment insurance.
While orders for action will help, Congress’ s Biden must pass legislation that would have a much greater impact. Biden is urging lawyers to bypass the $ 1.9 trillion American Rescue Package, which calls for $ 1,400 incentive checks for the majority of all those making less than $ 75,000, unemployment benefits developed, $ 350 billion in support of state and local governments and $ 400 billion in the outbreak of the pandemic.

Harman hopes Congress will work – before it runs out of money.

“We don’t want to go trillions and trillions in debt, but you have a situation that is once in a hundred years. You have to do what is necessary,” he said.

Wall Street is without a surface, for now

While some economists and Republicans are concerned about the size of Biden’s proposal, Hassett, the former Trump economist, told CNN Business that he broadly supports the $ 1.9 trillion package.

Markowska, a Jefferies economist, said the rescue effort would help but not solve the underlying problem.

“We have pushed for the recovery as far as we can without the service sector. Without it, we cannot make progress – no matter what level of fiscal stimulus we have put out there, “she said.

Joe Biden wants to avoid the biggest economic mistake of the Obama era. Congress may not
At least so far, Wall Street has been plagued by widespread and slow vaccine delivery. The S&P 500 and Nasdaq finished at the highest levels on Thursday, building on the best election day to a consecration day performance in the post-World War II era.

That’s because markets are teeming with emergency policies from the Federal Reserve that force investors to place bets on stocks. And investors are optimistic that the economy and corporate profits will recover in full, eventually.

“I don’t think it’s important for markets,” Hooper Invesco said, “but it’s certainly important for the economy.”

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