PRO: U.S. economy has overcome recession

By David Ranson

InsideSources.com

Though the president and first lady weren’t able to dodge the covid-19 bullet, the U.S. economy, we now know, has adapted remarkably well to the pandemic and social distancing. As a result, the worst of the covid-19 recession is over.

Real GDP dropped like a stone in the second quarter (April-June) of 2020, at a record annual rate of 31.7%. The great majority of forecasters did not anticipate that we could recover from such a blow anytime soon — even taking into account unprecedented government largesse.

Their predictions of sustained weakness are being overtaken by events.

Weeks ago the largest component of gross domestic product, consumer spending, already had bounced back to pre-pandemic levels, recovering twice as fast as employment or industrial production. Within just two months, May and June, retail sales had completed a full round trip. In July and August they rose further.

The speed and vigor of the U.S. rebound can be interpreted in two contrasting ways.

One is that federal intervention has been much more effective than expected. There will be no shortage of politicians waiting to take credit for that.

The other is that, collectively, virtually all of the so-called experts underestimated the economy’s intrinsic resilience.

It’s not clear whether government “stimulus” funds add to or subtract from the economy’s resilience.

Relief to those among the newly unemployed who are too pressed to fend for themselves may actually help them become more resilient.

On the flip side, moderate deprivation may be a greater spur to self-reliance, encouraging the unemployed to seek work rather than temporary income from government. Either way, the resilience of the U.S. economy is overpowering the covid-19 recession, which soon could be history.

David Ranson is a research fellow at the Independent Institute and director of research at HCWE & Co.

Con: This is a recession; Republicans need to stop blocking relief

By KAREN DOLAN

InsideSources.com

Even before the pandemic, nearly 140 million people in this country were poor or low-income. Now, they’re suffering even more acutely than before. I’ve spent the last several months interviewing some of these people as they struggle to make ends meet.

Nearly six months after reopening, the U.S. jobless rate remains stunningly high, and the latest jobs report was worse than expected.

According to a new survey from the Robert Woods Johnson Foundation and NPR, nearly half of all U.S. households report experiencing serious financial instability as a direct result of the current recession. Food insecurity has doubled in the United States, while fully one in three children in renter households is either food-insecure, housing-insecure, or both.

But that doesn’t mean that everyone’s suffering. My colleagues at the Institute for Policy Studies calculate that America’s billionaires have collectively seen their wealth increase by nearly $850 billion, or 29%, since the pandemic started. For the wealthiest among them — Jeff Bezos, Bill Gates, Mark Zuckerberg, Warren Buffett and Elon Musk — the increase is closer to 60%.

We are living through what economists call a “K-shaped recovery.” That is, the recovery line for the wealthy is on its way up while the line for everyone else continues to crash downward. In 2017, President Donald Trump and the GOP passed a trillion-dollar tax cut for the wealthy, exploding the deficit and putting a strain on social programs for those already struggling to get by. Most billionaires now pay lower tax rates than working-class Americans, and over half of the stock market is now owned by the top 1% of earners.

Throw in a recession where the lowest-paid workers were the most likely to see their livelihoods vanish and you get an astonishing acceleration of inequality.

Extended and enhanced unemployment benefits lapsed, a federal eviction moratorium ended, and there’s been no more direct cash aid even as the pandemic has ground on. The Democratic-controlled House of Representatives passed another desperately needed relief bill back in May, but the White House and GOP-controlled Senate have taken no action on it.

For all but the wealthiest Americans, this recession is far from over. If we as a country prioritize evidence-based virus safety measures, we won’t just wear a mask and practice social distancing. We’ll pass a robust relief package that helps those who need it most, so we can weather the storm and end the recession for all of us.

Karen Dolan directs the Criminalization of Race and Poverty Project at the Institute for Policy Studies.

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(5) comments

simon1dog

I'm voting for Donald Trump this election. 99.9% of Lake Havasu City is.

BigBob

Yes, yes, we know! You're going to waste your vote, we get it. I'd ask for some clarification on your 99.9% BS, but since you lie - all of the time - about everything you will not respond.

simon1dog

A big thanks to President Donald Trump. Yes, we are getting through this plague. Trump's business savvy is paying off in more ways than the Covid problem. He's Making America Great Again.

BigBob

You need some coffee. Let's consider your bizarre claims -

Had Typhoid Donny actually done his job it is estimated that 120,000 of the now dead 211,000 Americans because of his ineptitude would still be alive.

Typhoid Donny's business acumen led to Chapter 11 bankruptcy for his companies six times including multiple casinos - even an idiot can make a casino pay-off. He also entered a Manhattan hotel and two casino holding companies into bankruptcy. He also failed with the following businesses: trump airlines; trump beverages; the trump board game; trump magazine, trump mortgage company; trump steaks; trump travel; trump telecommunications; trump tower Tampa; trump vodka and his greatest failure for which he paid huge fines and had to shut-down – trump university.

So far his MAGA BS has netted us the following –

1) Highest national debt;

2) Most convicted team members;

3) Most pandemic infections in world history.

4) Use of military troops against citizens of the United States.

5) American’s being banned from traveling to Europe.

6) The deaths of more 185,000 Americans due to the trump virus.

7) Most disastrous drop in GDP in our nation's history.

A sucker is the chump who voted for Typhoid Donny in 2016. A loser is the chump who plans to vote for him in 2020.

Davel2

simondog... It's just Trump propaganda. He's not making America great. Prior to the pandemic, 40% of America did not have $400 in case of an emergency. 62% did not

have $1000. Did you miss the millions on bread lines within days of the shut-downs? Not a good indicator for the so called robust economy Trump said we were living in. The stock market is not a measure of how well average Americans are doing. It's going to be a hard road getting this economy even back to where we were, because despite how much Trump downplays the virus, Americans are not going to be fully involved in the economy until they feel safe. That will take real science, not Trump.

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