CLAIM: President Joe Biden claimed Monday that signing the $1.9 trillion American Rescue Plan has begun the U.S. recovery from the pandemic.
Three years ago today, I signed the American Rescue Plan.
It was the beginning of America’s revival. The pandemic is no longer controlling our lives, and we are building our economy from the middle out, bottom up, rather than the top down. pic.twitter.com/2t4d5ipufx
— Joe Biden (@JoeBiden) March 11, 2024
Verdict: False.
The U.S. economic recovery did not begin in March 2021. At that time, economic recovery was already well underway.
If anything, the American Rescue Plan may have derailed the recovery.
The pandemic and lockdowns have caused a severe economic contraction in the United States, with real gross domestic product contracting by an annualized rate of 5.3% in the first quarter of 2020 and an unprecedented 28% in the second quarter.
After that, there was a V-shaped recovery. In the third quarter of 2020, the economy grew at an annual rate of 34.8%. In the fourth quarter of 2020, it grew at a still strong pace of 4.8%.
The economy grew at 5.2% in the first quarter of 2021, which was almost over by the time Biden signed the American Rescue Plan into law.
Instead of starting the economic recovery, Mr. Biden’s extravagance contributed to a massive rise in inflation that nearly ended it. Economic growth in the first quarter of 2022 was nominally 6.6%, but inflation was rising further. As a result, real GDP contracted by 2%. In the second quarter, it contracted again by 0.6%.
