By Isaac Cohen*
The Chairman of the Federal Reserve Jerome Powell, last week during the now usual press conference after the Open Market Committee meeting, said the central bank’s summary of economic projections expect the economic recovery will last over “the next couple of years,” with unemployment projected to be close to 10 percent by the end of 2020. This means that the US economy, excluding a relapse caused by a “second wave” of coronavirus infections, faces a steep climb of at least two years before the return to the work force of the more than 20 million unemployed.
Several other observers coincide with the Federal Reserve. The Organization for Economic Cooperation and Development projects, for this year, projects a contraction of 6 percent in the world economy and of 7.3 percent for the US economy. The World Bank also expects for 2020 a contraction of 5.2 percent in the world economy and of 6.1 percent for the US economy.
Mainly for this reason both Chairman Jerome Powell and Treasury Secretary Steven Mnuchin agree that more support for the recovery is required from Congress. At a hearing of the Senate committee on small businesses. quoted in The Wall Street Journal (06/11/20), Secretary Mnuchin said “I definitely think we are going to need another bipartisan legislation to put more money into the economy.”
*International analyst and consultant, former Director ECLAC Washington. Commentator on economic and financial issues for CNN en Español TV and radio, TELEMUNDO and UNVISION and other media.