US partisan disputes should make way for stimulus package

Source:Global Times Published: 2020/3/23 22:29:42

Xinhua/Liu Jie

At a time when the world economy is on the brink of a depression, it's disturbing to find out that US partisan disputes continue to intensify and even block progress on much-needed aid for its people amid the coronavirus pandemic. US lawmakers on Sunday failed to pass a procedural vote on a potentially $1.8 trillion stimulus bill that aims to cope with the coronavirus crisis and offset its economic fallout, despite the fact that Treasury Secretary Steven Mnuchin reportedly said Congress is "very close" to get it done on Monday.

It's not the first time that the clash between Republicans and Democrats delayed some crucial political moves or even caused a crisis such as a government shutdown. But still the setback this time is terribly shocking considering the severity of the coronavirus emergency and the looming depression threatening the US economy.

Different from previous crises, the coronavirus pandemic is exerting a devastating impact on the global economy in an unprecedented way and speed. In the US, the Federal Reserve already cut interest rates to near zero, but it did nothing to stop stock markets from tumbling into a bear market in weeks. Risk aversion has driven up demand for the dollar, leading to a liquidity crunch.

But most worrying is the soaring unemployment in the wake of business shutdowns due to climbing numbers of confirmed cases. With more than 2 million jobless claims estimated to be filed last week, some worry certain states may not have sufficient funds to support the unemployed. Meanwhile the worst has yet to come, because the Federal Reserve Bank of St. Louis President James Bullard predicted that the country's unemployment rate could reach 30 percent in the second quarter, according to Bloomberg News.

A massive economic rescue is urgently needed, or the pandemic could lead to rising unemployment, presenting great turmoil for the country and the world. In American history, past economic recessions and depression saw mass unemployment and social discontent contribute to widespread rioting and unrest. If anything, social turmoil triggered by high unemployment rates is the least thing people need in any crisis, which will only throw the economy into a prolonged vicious cycle.

In this sense, US lawmakers need to drop their political bickering to accelerate progress on emergency stimulus, which is most likely crucial for preventing a recession from turning into a depression that may cost millions of jobs. Any delay or mishandling of the current economic turbulence could lead to a disaster for the US and the world.

Posted in: GT VOICE

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