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1 1 (August 31, 2021)

handle is hein.crs/goveelc0001 and id is 1 raw text is: Congressional SResearch Service The COVID-19-Related Fiscal Response: Recent Actions and Future Options August 31, 2021 The federal response to the Coronavirus Disease 2019 (COVID-19) pandemic has included programs providing economic relief to individuals, businesses, and state and local governments. Expiration or exhaustion of several of these programs has generated congressional discussions on the effect extending some of these programs could have on the U.S. economy's short- and long-term performance. This Insight briefly summarizes the fiscal policy response to COVID-19, highlights some programs that are near expiration or exhaustion of funding, and discusses underlying economic issues. For a full list of expiring provisions, see CRS Report R46704, Pandemic-Related Provisions Expiring in the 117th Congress. State of the Economy The COVID-19 pandemic generated a sudden and severe decline in economic activity. The national unemployment rate rose from 3.5% in February 2020 to 14.7% in April 2020, the highest monthly rate ever recorded (dating back to 1948). Real GDP declined at an annual rate of 31.2% in the second quarter of 2020, which was larger than any single quarterly change in real GDP (dating back to 1947). General economic conditions have improved since the early months of the pandemic. In the second quarter of 2021, real GDP surpassed its pre-pandemic fourth quarter 2019 level, and the unemployment rate, while still elevated, has decreased substantially from April 2020 and stood at 5.4% in July 2021. The strength of the recovery moving forward is uncertain. The Delta variant still poses a public health risk, the economy has experienced several months of moderately high inflation, and the labor force participation rate remains below pre-pandemic levels. Fiscal Policy Response Fiscal stimulus is short-term spending increases or tax decreases designed to increase short-run economic output. According to theory and historical evidence, fiscal stimulus can reduce the decline in output and employment associated with recessions and guide the economy back to the full-employment level of Congressional Research Service https://crsreports.congress.gov IN11734 CRS INSIGHT Prepared for Membersand Committeesof Congress