Texas A&M economist: COVID-19 vaccinations are the key to a healthy economy
COLLEGE STATION, Texas (KBTX) - With 2020 in the rearview mirror, we’re looking ahead to our economic outlook for 2021.
The Texas A&M Private Enterprise Research Center Director, Dennis Jansen, joined KBTX during First News at Four to talk about where we stand entering the new year and where we can expect to go.
“It’s the vaccines that will make the major additional improvements to our economy,” Jansen said.
He says the recent COVID-19 relief bill is a good way to start 2021. Jansen explains that the return of the Payroll Protection Program, another round of economic stimulus checks, and the additional unemployment benefits will help to get the economy rolling despite rising COVID-19 case numbers.
But, Jansen says the relief bill is only a temporary measure and notes that vaccinating all Americans is the long term solution that health officials will work towards throughout the year.
Jansen says our local community has had a remarkable recovery from such an unexpected economic downturn.
“We had very fast growth in the summer,” Jansen said. “It’s slowed some recently. So we’re still moving forward... but at a much slower pace. But in general, yes I think we’re moving in a positive direction.”
He says our local economic recovery will be predicated on two factors: funding for Texas A&M University and how many people are vaccinated locally. Jansen explains that our local economy is directly tied to the success of the university as it creates jobs and brings money to our area.
But one of the biggest issues in determining how successful A&M will be is the uncertainty in state funding. State lawmakers preparing for the 2021 state legislative session have been told by Texas Comptroller, Glen Hegar, that there will be at least a 4-5 percent decrease in state funds due to losses in sales tax revenue in 2020.
Jansen speculates that the decrease in state funds could be as high as 8 percent.
“That’s gonna cause problems for many state agencies,” Jansen said. “Including, most likely, unfortunately, Texas A&M University.”
Texas must pass a balanced budget at every biennial legislative session. That means state legislators will have the option to either cut programs and decrease funding or raise taxes. But with a Republican-controlled capitol, an increase in taxes is unlikely. That’s why state-funded organizations and institutions are worried there will be significant budget cuts.
Watch the full interview in the player above.
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