Fed Chairman Says More Economic Support For Americans Is Needed

(TheFreedomFlag.Com)- Federal Reserve chairman Jerome Powell thinks the federal government needs to step up to do even more to help the country pull out of the economic troubles it is currently in.
On Wednesday, the Fed released numbers that show the income gap is widening even more during the coronavirus pandemic. Statistics show that 40% of U.S. households that earn less than $40,000 per year have at least one person who has lost their job since February. As Powell said in a prepared statement:
“The scope and speed of this downturn are without modern precedent, significantly worse than any recession since the second world war.”
The pandemic has caused “a level of pain that is hard to capture in words,” Powell said.
This week, the Fed is expected to release a full report that will show the groups in the U.S. who have been hit hardest by the economic downturn. The first groups of people to lose their jobs were lower-wage workers such as people who work in retail and hospitality.
In April, Latinos posted the highest unemployment rate (18.9%). The unemployment rate for African Americans increased from 6.7% to 16.7%. Teenagers lost their jobs at stunning rates, increasing from a 14.3% unemployment rate in March to 31.9% in April.
Overall, the United States lost 20 million jobs in April alone, as the overall unemployment rate skyrocketed to 14.7%. Weekly unemployment claims have followed suit, reaching unimaginable levels over the last two months.
The coronavirus pandemic has caused states to shutter non-essential businesses in an attempt to stop the spread of the virus. Some states are now beginning to ease restrictions in hopes of re-starting “normal life,” even as the numbers don’t suggest it’s time to do so.
At the same time, people are spending less money as they lose their jobs or are worried about losing work, which has further exacerbated the economic problems.
As Powell said:
“We are seeing a severe decline in economic activity and in employment, and already the job gains of the past decade have been erased.”
In response, the federal government has thus far passed four rounds of economic stimulus bills intended to ease the burden on distressed industries and everyday Americans. Some programs in those bills included forgivable loans for small businesses, a boost and extension to unemployment insurance as well as direct checks to many Americans.
“While the economic response has been both timely and appropriately large, it may not be the final chapter, given that the path ahead is both highly uncertain and subject to significant downside risks,” Powell said. “Additional fiscal support could be costly but worth it if it helps avoid long-term economic damage and leaves us with a stronger recovery.”
Democrats in the House of Representatives released a fifth coronavirus relief bill that will top $3 trillion, with aid to state and local governments, increased money for testing and more direct payments to Americans as the cornerstones. The House is set to vote on the bill on Friday, though it likely faces opposition from the Senate as well as President Donald Trump.