How Long

Photo: Loyola and News.

By Isaac Cohen*

A debate is underway in Washington on when the economic recovery will start and at what speed it will happen. There are at least two sides actively involved in this debate, one side can be called the “optimists” and the other the “moderate optimists.”
The “optimists” include the White House and the majority of the Republican Party controlled Senate. The leading spokesman for this perspective is Treasury Secretary Steven Mnuchin, who led the negotiations with both branches of the legislature for the approval of the third rescue package of $2 trillion, known as the CARES Act. Secretary Mnuchin predicted accurately that unemployment could exceed 20 percent in this quarter and he also recognized, last week, the economy needs more relief. According to Secretary Mnuchin, the downturn will hit bottom during this second quarter, followed by a “gigantic increase” in the fourth quarter. (The Wall Street Journal 05/22/20).

The “moderate optimists” are more cautious and agree that another rescue package is required, but differ on the start the speed of the recovery. The Democratic Party controlled House of Representatives has already approved another rescue package amounting to $1 trillion, which still has to be approved by the Senate. Meanwhile, the Chairman of the central Bank Jerome Powell has said that the recovery may take some time and that it “could stretch until the end of next year.” (The New York Times 05/18/20).
Which perspective will prevail depends of the evolution of the pandemic.

*International analyst and consultant, former Director ECLAC Washington. Commentator on economic and financial issues for CNN en Español TV and radio, UNIVISION, TELEMUNDO and other media.

About Ramón Jiménez

Ramón Jiménez, Managing Editor de MetroLatinoUSA.Com (MLN). Graduado de la Escuela de Periodismo de la Universidad del Distrito de Columbia (UDC). Email: ramonjimenez169@gmail.com

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