The US economy returned to its pre-pandemic level in the second quarter, data released Thursday showed, giving President Joe Biden a political win as Congress moves closer to passing a long-debated plan to improve the country's infrastructure.
However the 6.5 percent annualized rate of expansion in the April-to-June period was slower than expected, and the Commerce Department report confirmed that inflation spiked as customers vaccinated against Covid-19 returned to businesses that suffered throughout the pandemic last year.
"Make no mistake: this growth is no accident, it's a direct result of our efforts to deliver economic relief to families, small businesses, and communities across the country," the Democratic president tweeted following the release of the data.
After taking office in January, Biden won passage of a massive $1.9 trillion spending bill to help the economy's recovery from the historic downturn the pandemic caused last year.
However, the disruptions of the preceding months have made getting production and employment back to normal challenging, while prices have surged as businesses face renewed demand, shortages of components and supply chain delays.
Biden has called for even more spending to reshape the world's largest economy, and on Wednesday evening, the Senate voted to advance a trillion-dollar infrastructure package that would pump historic levels of federal funding into fixing US roads, bridges and waterways as well as expand broadband internet and expand clean energy programs.
But Republicans who form a sizeable minority in the Senate could end up turning against the plan, while some progressive Democrats in the House of Representatives have warned they won't approve it unless Biden's ambitious $3.5 billion budget package including once-in-a-generation spending on health care, education, social welfare and climate action is also passed.
- Complicated recovery -
The pandemic caused a sharp downturn in the United States last year, with the economy ultimately shrinking 3.5 percent, its worst collapse since modern record-keeping began in 1946.
The country's Covid-19 vaccination campaign along with emergency spending packages passed under both Biden and his Republican predecessor Donald Trump have kept it from suffering a worse downturn. And the IMF predicts that this year the US economy will expand seven percent.
In the second quarter, the Commerce Department said GDP climbed to $19.4 trillion, above its level in the fourth quarter of 2019, before the virus broke out.
"The peak may be behind us, but we expect the economy to carry strong momentum into 2022, with growth underpinned by strong consumer and corporate fundamentals and a favorable fiscal impulse," Lydia Boussour of Oxford Economics said.
Forecasters predicted the economy would grow 8.5 percent, and Boussour blamed supply chain challenges for the undershoot, while calling the data a "key milestone in the recovery" and predicting strong economic growth later in the year fueled by consumer demand.
Second-quarter growth was above the 6.3 percent expansion in the first quarter, and driven by increases in consumer spending, exports and local government spending, the data said.
The expansion was undercut by the end to a government program to give loans and grants to small businesses hurt by the pandemic, and less overall federal government spending.
The data also showed the personal consumption expenditure (PCE) price index rising 6.4 percent in the second quarter from 3.8 percent in the period before, confirming that inflation is spiking as demand returns from its depressed levels a year ago.
Excluding volatile food and energy prices, the PCE price index rose 6.1 percent.
- Unemployment declining -
Separate data released by the Labor Department showed new filings for jobless benefits falling last week to 400,000, seasonally adjusted, a decline of 24,000 from the week prior.
However, the four-week average of claims rose, while as of the week ended July 10, 13.1 million people were receiving jobless benefits, according to the data, up more than half-a-million from the week prior and despite some states moving to end special pandemic unemployment programs.
Rubeela Farooqi of High Frequency Economics said seasonal adjustment issues in July are likely distorting the data.
"Job growth should pick up and labor shortages should ease as near-term constraints -- virus concerns, child-care issues and enhanced unemployment benefits -- diminish," she said. "But rising virus cases could be a headwind for the labor market and the economy."
© 2021 AFP
Harvard constitutional law professor Laurence Tribe tweeted Thursday about Steve Bannon warning that the Jan. 6 "rally" was going to be "hell." Bannon's comments are resurfacing as the congressional select committee begins its investigation into the Capitol attack.
Tribe claimed that if Bannon knew that it was going to be a "war" and "all hell is going to break loose," then President Donald Trump also knew what was going to happen.
"All hell is going to break loose tomorrow," Bannon said on his Jan. 5 show. "Just understand this: all hell is going to break loose tomorrow. It's going to be moving. It's gonna be quick."
Bannon was responding to Sen. Chuck Grassley's (R-IA) comment that Vice President Mike Pence would preside over the election certification. A previous report that day said that Grassley would be the one to do it and that Pence would not be there.
"The buried lead is 'we don't expect him to be there.' We don't expect him to be there," said Bannon about the news.
"It's the fog of war," Bannon added. "Keep focus on what's important."
Just before the rally, Bannon took to his show again, warning that he knew exactly when "some pretty controversial would" begin happening.
"Today's not just a rally... at one o'clock that starts and there's going to be some pretty controversial things going on," Bannon said.
Steve Bannon actually stated on his broadcast on the morning of January 6th just hours before the Capitol insurrect… https://t.co/k7GF5BEpdy— M. Mendoza Ferrer (@M. Mendoza Ferrer) 1627563958.0
It raises the question: What did Trump know and when did he know it? In his book "Frankly, We Did Win This Election," Michael Bender indicates that Trump did know. He recalls a conversation Trump had with aides about whether they thought there would be violence.
"[Trump] asked if they thought the day would be peaceful," the book says.
"Everyone who comes to your rallies is peaceful," Judd Deere told Trump. "Your supporters love law enforcement. Unless they interact with protesters, I wouldn't suspect any problems with our folks."
"'Well,' Trump ominously responded. 'Don't forget these people are fired up.'"
Carol Leonnig and Phil Rucker's book "I Alone Can Fix It" also suggested that the Trump administration was aware of the possibility of impending violence.
"A Homeland Security operations chief said his agency had picked up chatter of some folks traveling to Washington with intent to do violence but concluded the overall threat from these protests wasn't significant," the book said.
As early as Dec. 30, the Washington Post was warning of the plans being made for the event.
"Threats of violence, ploys to smuggle guns into the District and calls to set up an 'armed encampment' on the Mall have proliferated in online chats about the Jan. 6 day of protest. The Proud Boys, members of armed right-wing groups, conspiracy theorists and white supremacists have pledged to attend," said the Post.
See some of the tweets below:
If Bannon knew, so did Trump https://t.co/lNzS3I4cQK— Laurence Tribe (@Laurence Tribe) 1627551343.0
What did Bannon know and when did he know it? #SubpoenaBannon https://t.co/3oQu8w40LK— TG (@TG) 1627552483.0
Steve Bannon knew. If Steve Bannon knew then several Senators knew. This was a planned armed Insurrection to overth… https://t.co/56rDFVSgYm— Reesus Patriot (@Reesus Patriot) 1627564079.0
Of course, Bannon knew about the impending attack. I've always thought Trump was a buffoon -yes, a very dangerous… https://t.co/5sTkwWV1qi— Brian O'Sullivan (@Brian O'Sullivan) 1627566467.0
Marjorie Taylor Greene calls on supporters to exercise 'Second Amendment rights' on vaccine door-knockers from Biden's 'police state'
Republican Congresswoman Marjorie Taylor Greene of Georgia recently encouraged supporters to exercise their "Second Amendment rights" against vaccine door-knockers from President Joe Biden's "police state," in previously unreported remarks made to the Alabama Federation of Republican Women last Friday.
Greene told the group that Biden "is going to be sending one of his police state friends to your door" to see if you've been vaccinated, the Alabama Political Reporter reported Thursday morning.
"We all love our Second Amendment rights and we don't like the federal government coming on our property to tell us what to do," Greene said. "You have HIPAA rights and you do not have tell your medical information and you can tell them to get off your front porch and get off your front lawn."
Speaking at a sold-out Civic Center in Dothan, Greene also called the House of Representatives, in which she serves, "evil."
"I cannot believe I work in that place," she said, adding that she carries around a list of the 11 Republicans who voted to strip her of committee assignments based on her past incendiary comments and apparent support for violence against Democrats.
As previously reported, Greene's speech last Friday included her standard fare about impeaching Biden, expelling California Congresswoman Maxine Waters, and firing Dr. Anthony Fauci. Reporters were required to leave after a press availability beforehand.
Greene was joined at the event by Republican Alabama Reps. Mo Brooks and Barry Moore.
"She is brilliant. She is so nice, but she is a fighter," Moore reportedly told the group in introducing Greene.
"She will fight a circular saw in a phone book for the good of this country," Moore said, adding that House Democrats "have an AOC, but we have an MTG."
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