President Joe Biden and allies in Congress seem to have forged ahead with their $1.9 trillion COVID-19 relief package on Friday as lawmakers approved a budget outline that will allow them to muscle Biden’s plan through in the coming weeks without Republican support.
By a party line vote of 219-209, the House of Representatives passed the budget plan, after the Senate approved it in a pre-dawn vote. Vice President Kamala Harris cast the tie-breaking vote in the Senate for the first time.
Speaker Nancy Pelosi predicted the final COVID-19 relief legislation could pass Congress before March 15, when special unemployment benefits that were added during the pandemic expire.
“If I have to choose between getting help right now to Americans who are hurting so badly and getting bogged down in a lengthy negotiation ... that’s an easy choice. I’m going to help the American people hurting now,” Biden said.
It seems that Biden has the Democratic backing but not the Republicans on this matter. Republicans have floated a $600 billion aid package, less than a third the size of the Democratic plan. Even some Democrats, like Larry Summers, an economic adviser to former President Barack Obama, have warned that Biden might be spending too much.
Continued weakness in the job market, underscored by data released on Friday, proved the need for aggressive action, Biden said.
The US economy added 49,000 jobs in January, with the unemployment rate falling from 6.7% to 6.3%.
The consensus of an economist survey was for there to be 50,000 jobs added and the unemployment rate to remain unchanged.
The new unemployment figure of 6.3%, while well down on April’s peak high of 14.7%, is still around twice the pre-lockdown level, the report stated.
The numbers show signs of an improvement, however, they are slight and give little indication of the longer-term prospects of the US economy.
Following the report the S&P 500 opened higher and touched intra-day record highs.
While the non-farm payroll report showed a dip of 10,000 manufacturing jobs, data over the past eight months has been positive with 803,000 manufacturing jobs added since April.
With encouraging signs for manufacturing, attention will now turn to Joe Biden’s stimulus package in hope of a more sustained economic recovery. Beyond the stimulus package the government’s vaccine roll out will play a vital role in further lowering unemployment figures.