Overnight Finance

On The Money — Economy had post-recession growth in 2021

Happy Thursday and welcome to On The Money, your nightly guide to everything affecting your bills, bank account and bottom line. Subscribe here: thehill.com/newsletter-signup. 

Today’s Big Deal: The U.S. economy bounced back quite strongly from the coronavirus pandemic emerging in 2020.  We’ll also look at a decline in jobless claims and new life for the expanded child tax credit?  

But first, find out why climate change is good for avocados but bad for cereal.

For The Hill, we’re Sylvan Lane, Aris Folley and Karl Evers-Hillstrom.  Reach us at slane@thehill.com or @SylvanLane, afolley@thehill.com or @ArisFolley and kevers@thehill.com or @KarlMEvers. 

Let’s get to it. 

 

US economy grew 5.7 percent in 2021

The U.S. economy grew by almost 6 percent in 2021 as the country staged a rapid rebound from the blow of the coronavirus pandemic, according to data released Thursday by the Commerce Department. 

U.S. gross domestic product grew 5.7 percent last year after falling 3.4 percent in 2020 as the onset of COVID-19 derailed the global economy and wiped out 21 million domestic jobs, according to the Bureau of Economic Analysis.   

Growth also accelerated during the last quarter of the year, hitting an annualized pace of 6.9 percent even as high inflation strained consumers and businesses. That means the U.S. economy would have grown almost 7 percent if the fourth-quarter pace of growth lasted an entire year. 

Sylvan breaks down the GDP jump here. 

 

CTC STILL IN PLAY

Top House Democrat open to lower income caps for child tax credit to win over Manchin  

House Majority Whip James Clyburn (D-S.C.) expressed openness to lowering the income limits for families to access the expanded child tax credit if it helps win Sen. Joe Manchin’s (D-W.Va.) support for the party’s sweeping climate and social spending bill. 

Clyburn said in an interview with The Washington Post on Thursday that he thinks Democrats still have wiggle room with getting Manchin on board with a party-backed expansion to the child tax credit after its recent lapse. 

“He wanted to see it means-tested. I’m not opposed to that,” Clyburn said, adding he would like to see Manchin “come forward with a bill for the child tax credit that’s means-tested.” 

Aris has more on Clyburn’s comments here. 

JOBLESS CLAIMS DOWN

New jobless claims drop to 260K after weeks of increases 

New applications for jobless aid fell sharply by 30,000 last week after several weeks of increases, according to data released Thursday by the Labor Department.  

After falling below pre-pandemic levels in November, jobless claims rose steadily through January as the omicron variant drove a record-breaking spike in COVID-19 cases. Roughly 12 million Americans missed work at the beginning of January because either they or a loved one they cared for contracted COVID-19, according to Census Bureau data released last week. 

“The first decline so far this year in seasonally adjusted new jobless claims is a welcome sign after three consecutive gains,” wrote Mark Hamrick, senior economic analyst at Bankrate, in a Thursday analysis 

Sylvan breaks it down here. 

UNDER PRESSURE

Congressional Progressive Caucus (CPC) leaders are urging the Democrat-controlled Senate to pass President Biden’s Build Back Better package by March 1, saying the timing would give him a much-needed opportunity to announce a major accomplishment during his State of the Union address. 

“In the months since negotiations around the Build Back Better Act stalled, the case for this legislation has only become more urgent,” said Rep. Pramila Jayapal (D-Wash.), who chairs the group of liberal lawmakers on Capitol Hill, wrote in the Thursday statement.  

Jayapal listed several issues that have escalated recently that are hurting Americans and explained how Biden has a chance to tell voters that he worked with congressional Democrats to fix some of what has been broken.  

The Hill’s Hanna Trudo has more here. 

Good to Know 

A new poll of voters in six potential swing states and states with senators up for reelection in November found that a majority of voters are worried about how President Biden’s signature spending proposal might worsen rising prices. 

The survey, which was commissioned by the National Association of Wholesaler-Distributors, a business group that is lobbying lawmakers to abandon the bill, found that 57 percent of respondents believe Build Back Better, when described as a multi trillion-dollar spending package, will worsen inflation.

Here’s what else we have our eye on: 

 

That’s it for today. Thanks for reading and check out The Hill’s Finance page for the latest news and coverage. We’ll see you Friday.

Overnight Finance