News Release

Unprecedented federal fiscal response to COVID-19 propped up economy, but created significant challenges

May 31, 2022 (Salt Lake City) – In the midst of the tremendous challenges created by the COVID-19 pandemic, which included significant health impacts and widespread layoffs, the federal government began its fiscal response to help prop up the U.S. economy. A report released today by the Kem C. Gardner Policy Institute details the federal government’s 2020 and 2021 fiscal policy (i.e., spending and taxing) responses to the pandemic and the initial impacts of these fiscal responses, particularly on western states.

“While the Federal Reserve’s expansionary monetary policy (i.e., money supply increase and corresponding interest rate reduction) played a significant role in stabilizing the U.S. economy through the early pandemic, the massive scale of the federal government’s fiscal response to the COVID-19 pandemic (about 25% of 2020 GDP) far exceeded its fiscal response to other economic downturns,” said Gardner Institute Chief Eco