Chairman Yarmuth’s Opening Statement on How the American Rescue Plan Saved Lives and the U.S. Economy
WASHINGTON, D.C. – Today, Kentucky Congressman John Yarmuth, Chair of the House Budget Committee, gave the following opening statement at the committee’s hearing on how the American Rescue Plan delivered lifesaving and vital relief that changed the course of the pandemic and enabled the United States’ record-breaking economic recovery. Chairman Yarmuth’s remarks as prepared and video are below:
Good morning. I want to welcome our distinguished panel of witnesses — thank you for joining us for this important hearing on the American Rescue Plan.
This legislation, which I was proud to sponsor, was signed into law 15 months ago. A lot has changed since then and the American people have benefited enormously from the provisions of this law. But they have also been subjected to a lot of misinformation about the law, so today, I want to start by laying out the facts.
In 2021, the Rescue Plan powered the strongest economic growth in nearly 40 years, helping to improve our fiscal standing and laying the foundation for our record-breaking recovery.
On the jobs front — before the Rescue Plan, the nonpartisan Congressional Budget Office projected our unemployment rate would be 5 percent right now, and that it wouldn’t drop below 4 percent within this decade. Thanks to the Rescue Plan, unemployment is near historic lows, at 3.6 percent. Seventeen states — including my home state of Kentucky — are seeing their lowest unemployment rates on record. In fact, the Rescue Plan nearly doubled GDP growth and led to the creation of 4 million additional jobs in 2021 — that’s millions of Americans earning a paycheck as a direct result of the Rescue Plan.
And it’s not only jobs. Incomes are up too by more than 5 percent overall, and by nearly 12 percent for the lowest-earning workers — that’s even after accounting for inflation. The child poverty rate dropped nearly 40 percent from 2020 to 2021. Despite the economic fallout of the pandemic and the possibility of a wave of evictions, foreclosures hit an all-time low last year.
Across-the-board, the data shows that the Rescue Plan helped American families enormously, ensuring they could put food on the table, stay in their homes, and avoid economic devastation despite the turbulent times.
The law was also enormously beneficial to state and local governments. During the Great Recession, the contraction at the state and local level hurt our overall recovery and prevented states from addressing community needs and longer-term impacts of the recession.
This time, funding from the Rescue Plan helped state and local governments avoid massive layoffs – keeping teachers, firefighters, police, and millions of other essential workers on the job. Local leaders had the resources necessary to meet urgent needs and ensure their communities came out of the pandemic better than they went into it.
Not only was the Rescue Plan more effective than other aid packages during the previous recession, but it also helped the United States recover more quickly than other nations. In fact, the U.S. had the fastest economic recovery among the G-7 countries — and our economy is projected to be larger at the end of this year — relative to its pre-pandemic size — than any other G-7 economy.
Clearly, we have made significant progress, but now inflation is a challenge. Again, here are the facts: Experts across the ideological spectrum agree that the main drivers of current inflation are international supply chain issues and energy price hikes caused by Russia’s war in Ukraine. These are global challenges, which is why inflation is a global issue. As Treasury Secretary Yellen said last week, “we’re seeing high inflation in almost all of the developed countries around the world. And they have very different fiscal policies.”
But unlike our global counterparts, America is in a better place to face these economic headwinds because of the American Rescue Plan.
We have avoided the kind of long-lasting financial damage to families and communities that typically follows an economic downturn of the size we experienced. We have avoided the grim forecasts CBO projected before the Rescue Plan. We saved our economy and we delivered lifesaving and life-changing relief to families across the country, all while fueling the most equitable and impressive economic recovery in recent memory.
There is a lot to learn from the Rescue Plan and the important role the federal government can play in the lives of Americans. I look forward to discussing this further with our esteemed panel of witnesses today.