The world is starting 2024 on an optimistic economic note, as inflation fades globally and growth remains more resilient than many forecasters had expected. Yet one country stands out for its surprising strength: the United States.
After a sharp pop in prices rocked the world in 2021 and 2022 — fueled by supply chain breakdowns tied to the pandemic, then oil and food price spikes related to Russia’s invasion of Ukraine — many nations are now watching inflation recede. And that is happening without the painful recessions that many economists had expected as central banks raised interest rates to bring inflation under control.
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Part of the reason that economic growth has been so surprisingly strong in the United States is simple: The American government has continued to spend a lot of money.
Government expenditures as a share of overall output hovered around 35 percent in America in the years leading up to the pandemic, based on I.M.F. data. But in 2020 and 2021, they jumped above 40 percent as the government responded to the coronavirus with about $5 trillion in relief and stimulus to people, businesses, institutions, and state and local governments.
Both states and households have only slowly spent down the savings they amassed during those pandemic years, so the money has continued to trickle through the economy like a slow-release booster shot. On top of that, government spending has remained elevated as the Biden administration has begun to make sweeping infrastructure and climate investments.
Oh I assumed you were American! Well hey fellow Brit, sadly I got some bad news for you:
No we don’t, our public transport is dysfunctional due to endless strikes (which are due to shit pay and shit conditions) and the NHS is practically non-existent for dentistry, mental care and more due to years of neo-liberal austerity policies and “market solutions” that involve transferring money from our public purse to the fascists-to-be’s mates.
At least the US has brute force of capital to cushion it if you’re working some jobs and don’t have any serious health problems.
Here in the UK even senior software devs struggle to make rent. We live with exactly the level of public services the US has in practice and we have no money for alternatives. Absolute shithole country. Government is literally landlords. Only remaining export is Transphobia.
Cool story, bro. But, you see, I migrated to the UK 8 years ago from a poor Eastern European country with only €2,000 in my pocket and bought my own home in London 2 years ago. If you can’t afford life in the UK, the problem is with you. Sounds harsh, but that’s the reality. Yes, things could be better, but they’re better than in most of the world.
Ah yes, I stand corrected, all those poor teachers and nurses increasing food bank use should’ve just worked harder and took their €2,000 and pulled themselves up by their bootstraps /s
Absolute ghoulish behavior mate.
How did senior software devs turned into teachers? Mmm? Mate, you better stay quiet, people will think that you’re smart.