Biden's spending bill was almost killed by Senator Joe Manchin.
Samuel Corum is a photographer.
Goldman said that the rejection of the Biden administration's spending plan by Sen. Joe Manchin will likely lead to slower economic growth.
The Wall Street bank cut its forecasts for US GDP after the West Virginia Democrat said he couldn't vote for the legislation.
Goldman's analysts think the bill is unlikely to pass. The most likely outcome is a smaller set of measures.
The US economy is expected to grow.
The previous estimate was 3%.
3% in the second quarter, down from 3.5% earlier.
In the third quarter, it was 2%.
The $2 trillion build back better plan aims to expand the social safety net in the US with a focus on children and climate change.
All 50 Democrats in the Senate must vote for it to pass. The legislation was doomed when the West Virginia senator said he couldn't vote for it.
He told Fox that his Democratic colleagues in Washington are determined to dramatically remake our society in a way that leaves our country vulnerable to the threats we face.
Goldman's analysts noted that the winding-down of support programmes was going to have a negative impact on the US economy.
The fiscal impulse will become more negative than expected, with the expiry of child tax credits acting as a drag.
The current high rate of inflation in the US will make it more difficult for the administration to revive the spending plan, according to Hatzius and colleagues. Goldman expects inflation to rise to a 39-year high of 7 percent in early 2022, after it rose to a 6.8% year-on-year increase in November.
The bank said that the Omicron variant is likely to shift political attention away from long-term reforms.
Goldman's analysts said that the bill imposed higher taxes to pay for much of the spending, so there could be some benefits for financial markets.
Goldman had estimated that higher corporate taxes would reduce S&P 500 profits by 3%. It said that pharma companies may no longer be under pressure to reduce prices.
The secular stagnationistas are blowing it. America's economic boom is going to last through 2022.
Business Insider has an original article.
