Georgina Clissold

Is the 'Biden Boom' over before its even begun?


2 min read

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A little over a year ago the US entered a new chapter, as President Joe Biden was sworn into office. Biden’s inauguration came during the middle of the coronavirus pandemic, and during an uncertain time for the US and its economy.

Many economic analysts and citizens had predicted and prayed for a calmer presidency, though it appears no one could quite prepare for the ‘Biden Boom’.

Whilst the US, and the world, continues to face unpredictability regarding coronavirus and what is yet to come, it’s impossible to ignore the economic boom seen in the US, under Joe Biden’s first year in office.

In 2021, the US’s economy recovered all its pandemic-related GDP losses – and exceeded pre-pandemic levels, despite the spread of different variants of coronavirus.

More so, the US economy had added 6.2 million jobs between January 2021 and December 2021, the most created on record – in turn, the unemployment level in the US fell as its fastest pace on record.

Although the inflation rate in the US has hit its highest level in over 30 years, Americans disposable incomes were higher (inflation-adjusted) than they were in 2019 and 2020 respectively.

Whilst growth in the economy had been expected, as much of the country reopened from lockdown restrictions, the pace of growth was not as anticipated.

Biden’s passing of the American Rescue Plan Act (ARPA) in March 2021 meant that aid was going direct to the households who needed it most, and a ramped up Covid-19 vaccination roll out helped to get businesses reopen sooner rather than later. Daring and divisive federal action, which included additional stimulus checks and expanded unemployment benefits, provided much needed relief to US citizens.

Biden, and the US economy, have a long way to go. Although the President’s first year in office has been relatively successful, new variants of coronavirus look to threaten the current strength of the country’s recovery.

In response to the Omicron variant of coronavirus and a pullback in government aid, investment bank, Goldman Sachs, has cut its US GDP growth forecast to 3.2% from 3.8% for 2022:

“While the fiscal headwind will impact 2022 as a whole, Q1 may look especially soft, in part because the rapid spread of the Omicron variant has weighed on services spending and may prolong supply chain disruptions.”

Biden’s plans for the US are big, and his Build Back Better framework largely repels much of the Trump administration. Although the President looks to be on the right track to implementing his fantasy of a reinvented America, large levels of inequality, and racial and gender imbalances remain across the country.

To truly Build Back Better, Biden needs to focus on forging a true equality for all, including people of colour, people with disabilities, and women. Clawing back to pre-pandemic levels of GDP is a start – but the next three years of the Biden administration have many foundations to lay down.

Final thoughts

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