President Biden's Economic Plan
Photo Courtesy of Clem Onojeghuo via Unsplash
As the start of Jan. 2021 marked the term of a new president, many Americans have begun to wonder how quickly the US economy can recover with COVID-19 still remaining as an obstacle. Since his inauguration, President Joe Biden has signed 50 executive orders—some of which focus on extending previous deadlines, and many of which focus on coronavirus relief. Many of these orders are also direct reversals of former President Trump’s previous bills. Here are a few economic orders that give an idea of the economic status for the coming year and how it will support families in need.
The pandemic and lockdowns have taken a clear toll on today’s economy. With decreases in investments and food, travel, and healthcare services, The U.S. Bureau of Economic Analysis states that “real GDP decreased 3.5 percent in 2020,” compared to the previous year. This change in GDP shows a fluctuating supply and demand market, followed by fluctuating prices that come along with it. Additionally, lockdowns have also hindered families from working and made finding jobs much more difficult. The unemployment rate in December 2020 had a high of 9.3 percent, rising greatly from the previous year with an unemployment rate of 3.6 percent.
Almost immediately after his inauguration, Biden announced his $1.9 trillion relief plan and stimulus package. This plan marks the third round of stimulus checks, now with an amount of $1,400 to those who need it most, including immigrants without social security numbers. With this in mind, this portion of the plan might not be approved due to limits within the federal budget. Although Biden argues that relief checks are essential for even those who have kept their jobs, many argue that this method wont boost the economy and are ultimately targeting the wrong people. Moreover, the president has also changed the federal minimum wage from the current $7.25 per hour to $15 for the first time since 2009, allowing the new federal wage to increase interest in the economy. While this wage change would more accurately match inflation from 2009 to 2021 and pull Americans out of poverty, implementing the new $15 minimum wage brings in many skeptics that argue that this change will result in the loss of 1.4 million jobs.
Biden also explains how this relief package provides support for families and groups in need by reinstating previous COVID-19 relief plans, as the goal in mind is to support those in financial hardships in order to create more jobs for the year. For example, the restriction on evictions or foreclosures (originally set to expire in January) was extended to September, giving struggling families a boost back on their feet. Similarly, Biden also addressed various methods of giving financial and food aid to those in need—one of which includes giving upwards of $100 every two months to families with three or more children. Along with this, although not included in this relief plan, the same helpful treatment was given to help college students with extensions on student loan payments—this executive order allows students to put a pause on paying student loans as well as halting interest.
Unrelated to his COVID-19 relief plan, another one of Biden’s orders to take note of is the aluminum tariff proclamation in which he reinstated. The aluminum tariff, originally set by former President Trump, set a 10 percent tax on aluminum imports from the United Arab Emirates with the goal of strengthening the U.S.’s domestic aluminum and steel producers—Trump stated that other countries (such as the UAE) were a threat to the U.S.’ national security as their production of steel and aluminum was overshadowing American producers and throwing them off the market However, former President Trump originally set to stop these taxes hours before the end of his presidency, giving the idea that these levies are more political than economic.
From America’s experiences with the Great Depression era, in order to get Americans interested in the economy again, money, relief, and jobs need to be pumped into the economy as well— and Biden seems to represent this method in his plans. Although the $1.9 trillion relief plan sounds pleasing and beneficial to Americans, many doubts about the application and effects of the plan still shine though. While it’s still possible for Congress to overturn or alter this COVID-19 plan, the new president is clearly hopeful about the future economy of the U.S. As these executive orders branch beyond economical goals, the rest of the year still remains unknown—and unexpected changes, as well as changes in the US’ allies, may continue to arrive.
