US needs additional financial stimulus to recover from Covid-19 downturn

27th July 2020 (Last Updated July 27th, 2020 08:00)

27 July

Additional stimulus to deal with the impact of the Covid-19 pandemic in the US will be required over the next few years.

Sectors such as child care have been impacted by the pandemic leaving parents vulnerable to lower incomes in the future.

John Van Reenen, professor at MIT Economics, shared an article on the next stimulus package being considered by the US government.

Although politicians project that the US economy may require $3tn in stimulus, macroeconomists highlight the need to incorporate automatic fiscal stabilisers.

Unemployment benefits under the CARES Act are set to end in July although experts have called for an extension of the benefits.

As jobs are yet to return to normal levels, unemployment benefits are essential to protect households from bankruptcy.

Meanwhile, Anthony DeRosa, a journalist, shared an article on the impact of the Covid-19 pandemic on the child care system in the US.

The article notes that the economic impact of the collapse of the system will be visible for the next 20 to 30 years, and that more stimulus was injected to save airlines rather child care.

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