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USA: What will Biden’s win change in the economic, political and health context?

ABS Think Big (5)

For the first time in a decade, a Democratic president is supported by both houses of Congress, albeit with a narrow majority. Joe Biden has inherited a complicated political and economic environment, especially since his election comes in the midst of the Covid-19 health crisis. The President-elect must heal the wounds of the United States and get the world’s largest economy back on track.

On the economic level

Joe Biden pledged on 14 January to allocate $1.9 trillion to his American Rescue Plan. In addition to raising the federal minimum wage from $7.25 to $15 an hour and extending federal unemployment benefits, the plan also includes measures to support infrastructure, public transportation, housing, clean energy, etc. The American Rescue Plan will help the economy by increasing the federal minimum wage from $7.25 to $15 an hour and extending federal unemployment benefits.

The President-elect intends to boost the United States’ global competitiveness, revive the fight against climate change and boost employment. In the face of the rising unemployment figures recorded in December 2020 due to the pandemic (140,000 jobs lost), it is indeed becoming urgent to support the 10 million Americans who have lost their jobs.

There is no doubt that the US economy needs support, but the scale of the Biden plan is currently being debated among economists in the US. The stimulus is expected to increase the fiscal shock to about 13 per cent of GDP. While these investments are a source of economic growth and job creation, they are also likely to increase public debt, which rose from 106% to 136% of GDP during the pandemic.

On the political level

Most commentators agree that Trump’s trade war with China was an economic disaster. Not only did Trump fail to secure major concessions from China, but the trade war slowed US economic growth. The new president will certainly take a more diplomatic approach to the United States’ traditional allies around the world and seek to expand the dialogue with China beyond trade to include investment law, intellectual property and human rights.

A mutually acceptable outcome to the negotiations would be a welcome, but unlikely, development. Biden does not want to immediately remove customs duties on 200 billion Chinese imports, but observers expect them to be removed by the end of the first mandate.

Regarding Europe, the US should work for more balanced and harmonious trade relations with the EU, while further strengthening traditional cooperation with the UK.  Biden also promised to re-engage with European allies and to adopt a more collaborative stance than that of his predecessor, particularly on the reform of the World Trade Organization.

The US would therefore need to work closely with the EU to resolve bilateral disagreements through negotiated solutions. Biden’s ability to get the EU to cooperate on these issues should restore the ability of the US to build a strong international coalition.

On the health front

On January 20, just hours after taking oath as the 46th president of the United States, Joe Biden signed an executive order ending the process of US withdrawal from the World Health Organization (WHO), launched by Donald Trump in July 2020. The president-elect subsequently issued an executive memorandum on January 28, 2021, as a first step towards reversing some of the measures taken by his predecessor regarding sexual and reproductive health rights. The measures taken by the Trump administration made it difficult for women to access certain medical services and the information they need for treatment.

During his election campaign and even in his inaugural speech, Biden said that the health of Americans must be a top priority. For example, as part of his plan to fight the Covid-19 pandemic, the president made it mandatory to wear masks and ordered the quarantine of people arriving in the United States by plane. In addition, people from Brazil, the United Kingdom, Ireland and South Africa have been banned from entering the United States starting January 25, 2021.

In a brief speech at the White House on March 2, the U.S. president said his country would have enough Covid-19 vaccine for all American adults “by the end of May”. The Biden administration, which marked its break with the Trump administration on several issues, wants to stand up for Obamacare. On February 10, 2020, the Biden administration pleaded before the Supreme Court to maintain the Affordable Care Act (ACA) which makes it mandatory to purchase health insurance, thereby providing millions of Americans with better access to health care. As a reminder, the repeal of Obamacare was one of Donald Trump’s main objectives.  The Supreme Court will render its decision on this matter in June 2021.

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