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Synchronous Global Economy: Pell Grant Increase’s Influence

How a “synchronous global recovery” is occurring and the reasons for it

The COVID 19 pandemic is known for a variety of consequences, the most significant of which are economic ones. However, this situation is expected to improve many sectors of activity and all regions of the world eventually, as according to Smart, “the global economy is poised for a synchronized recovery.” It implies that after the sequence of adverse effects of the pandemic, such as high unemployment rates, there will be improvements, which may balance the economy and raise it to a new level (Smart). This phenomenon is usually present in the economy, and assist in it strengthening.

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The reasons for a synchronized recovery are that the global economy has been proved to be resistant, and the level of investment from the private corporate sector grows (“2021 Global economic outlook: Next phase of the V-shaped recovery”). According to Smart, “the speed of the recovery will likely be equal to the speed of the decline,” which indicates the tempo of its occurrence. Currently, synchronous global recovery entries a self-sustaining phase, the outcome of which is global growth (“2021 Global economic outlook: Next phase of the V-shaped recovery”). The process of balancing the deterioration of the economy was provoked by the pandemic’s negative consequences and maintained by the growth of the private sector.

“Synchronous global recovery” impact on the United States domestic economy

As has been mentioned above, the synchronous global recovery is expected to result in positive changes. According to Smart, the “increase in gross domestic product for the United States is 5,9% growth,” which shows the significance of this phenomenon’s impact. Simultaneously, financial optimism in the U.S. is amounted to 73,0%, despite the high rates of unemployment in April 2020 that was 14,8% (Smart). The other effects of the recovery are economic pre-eminence, strengthen of the economy, and increase in the levels of efficiency and innovations of the private corporate sector (Smart). It is possible to state that synchronous global recovery has a positive influence on U.S. overall.

How the Pell Grants increase will influence the United States market economy

Pell Grants proposed by President Joe Biden is expected to influence the United States market. According to Gonzales, this program implies “investing over 80 billion of dollars to provide federal college aid for low-income students.” It will broad access to college education and allow using this aid for expenses other than tuition (Gonzales). There are several reasons, which show the advantage of increasing the Pell Grants for the United States market economy that also has pros and cons for the unemployed workers. Despite a large amount of money, this grant requires that it is expected to have the increased earnings of employees, as college graduates are likely to have a higher level of income (Klebs). It will result in paying more taxes that will repay the expenses and strengthen the United States economy.

The mentioned above benefits from the increase in Pell Grants will affect unemployed workers, who depend on taxes, the government gets, as they are being compensated (Klebs); (Thompson). This dependency might result in the rise of the amount of funding (Thompson). Potentially, unemployment can reduce the size of the award gained from the program, as the worker is already being compensated by the government. Simultaneously, the increase in Pell Grants is expected to positively influence the number of college graduates, who will be competing with unemployed ones and each other for vacant positions (Thompson). Therefore, the general economic effects from the increase in Pell Grants are the greater amount of taxes that might lead to higher compensation for unemployed workers and increase the number of applicants for a job.

Works Cited

“2021 Global Economic Outlook: Next Phase of the V-shaped Recovery” The International News, 2020, Web.

Gonzales, Jason. “Biden’s Free Community College Plan Would Present Big Opportunities, New Challenges for Colorado.” Chalkbeat Colorado, 2021, Web.

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Klebs, Shelbe. “Why We Should Double the Pell Grant.” Third Way, 2020, Web.

Smart, Tim. “One Year After the Pandemic Struck, Global Economy About to Boom.” Us News, 2021, Web.

Thompson, Van. Will Receiving a Pell Grant Affect My Unemployment at All?” The Nest, Web.

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