The federal government has been pulling many stops to ease any adverse effects the pandemic could cause for the U.S economy. According to several economists, the impact of this pandemic was estimated to be similar to that of the 2008 recession. Unemployment rates have increased. Governments at the state, local, and federal levels have implemented plans to reduce the burden on the economy. However, such measures still need more effort to save Americans from the dire consequences the pandemic will cause, as well as its after-effects.
Michael E Weintraub Esq highlights federal government initiatives
Michael E Weintraub Esq shares some of the more crucial initiatives and plans that have been implemented by the federal government and the Federal Reserve in the face of the COVID-19 pandemic.
- Trump signed an $8.3 billion emergency spending package
This spending package was initial legislation mandated to address the pandemic. President Donald Trump signed an emergency measure when pandemic cases crossed the 100,000 infected mark globally in March of 2020. This package financed authorities that are combatting the virus in their effort to contain the pandemic. About $3 billion was assigned to vaccine research.
Federal government says that it will pool more than $1 trillion for finances
The Federal Reserve announced that it would add $1.5 trillion to the financial system to ground the market. This move came with liquidity issues and set the market high initially. Some experts thought this move would not be an adequate response.
- Trump pauses interest on student loan repayments
President Trump provided some relief to student loan borrowers. All federal student loan interest would be temporarily waived due to the pandemic through 2020. One week after this legislation passed, borrowers worried that the interest rate would be levied. A spokesperson for the Department of Education assured that the interest discussed in the announcement would be eliminated.
- Trump announces a national emergency
President Trump was initially hesitant in announcing a national emergency because of the pandemic. He feared that this move could cause the financial market to crash. However, when he declared a national emergency, major indexes increased, showing the biggest single gain since 2008. This initiative freed up as much as $50 billion in financial resources to support Americans who were adversely impacted by the pandemic outbreak.
- Federal government reduced rates to zero and launched a $700 billion quantitative easing program
This dramatic action was taken by the Federal Reserve, which was a similar response to the 2008 financial crisis. Through this action, the central banks reduced rates to zero and declared a $700 billion easing program. According to the government, this was supposed to include a $500 billion Treasury stimulus and $200 billion in agency-backed mortgage securities. The central bank later said that it would purchase municipal bonds. It was decided that the zero-benchmark interest action would remain in place for a while. Some believe that we can be confident that the economy has weathered all recent events with ease and is back on track. Others are more skeptical.
These are a few essential state planning actions that helped aid states and citizens to ease the burden of issues that came up due to the COVID-19 pandemic outbreak.