WASHINGTON – The U.S. economy will recover its pre-pandemic size by mid-year without any emergency stimulus, the U.S. Congressional Budget Office projected Monday.
The report throws a wrench at President Biden’s push to approve a huge $ 1.9 trillion bailout plan ahead of a meeting with 10 Republican lawmakers in the White House on Monday evening after presenting the his own most modest proposal.
The non-partisan federal agency makes an optimistic forecast after a year-long fight with the coronavirus that has killed 441,000 Americans, stopped millions of jobs and shut down large swathes of the U.S. economy.
The office said gross domestic product would 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 distancing.
“Labor market conditions continue to improve. As the economy expands, many people are rejoining the civilian workforce that left it during the pandemic, restoring its pre-pandemic size in 2022, ”the report said.
“The unemployment rate gradually decreases throughout the period and the number of employed returns to its pre-pandemic level in 2024,” he continued.
The Biden administration last month introduced a $ 1.9 trillion bailout package as its first major legislative effort, as the unemployment rate hovered around 6.7 percent.
The package includes $ 1.4 billion in stimulus control for eligible Americans, $ 20 billion for a national vaccine program, and reportedly would halve child poverty.
But many Conservatives and Democrat Sen. Joe Manchin of West Virginia, a key vote, have argued against approving such a large package following a $ 900 billion aid bill passed by Congress, arguing that it s ‘will add to the growing national debt.
At a news conference Monday, White House spokeswoman Jen Psaki dismissed criticism of the Biden package and said it had been backed by other economic authorities.
“A new report from the Brookings Institution estimates that, with the US bailout plan, we would increase GDP by 4% and return our economy to pre-COVID levels by the end of 2021,” Psaki said.
“A separate analysis of Moody’s Analytics found that the president’s plan would create 7.5 million jobs,” he said.