Friday, February 5, 2021

Biden emphasizes urgency of $1.9 trillion Covid relief

 

President Joe Biden speaks about the economy in the State Dinning Room of the White House, Friday, Feb. 5, 2021, in Washington. (AP Photo/Alex Brandon)

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(CNN)President Joe Biden responded to a new, sluggish jobs report by continuing to press for his $1.9 trillion Covid relief package to be passed with urgency -- even as a leading economist who served in the Obama administration is sounding the alarm on how the White House's plan could have negative economic consequences.

"We saw the jobs report. Only 6,000 private sector jobs will be created. And at that rate, it's going to take 10 years before we get to full employment. That's not hyperbole," Biden said Friday morning in the Oval Office during a meeting with House Democratic leadership.
"I appreciate you all coming over because -- the urgency with which you're moving -- this is about people's lives. This is not just about numbers," Biden said. He added that many Americans are "really hurting" and Congress has the opportunity "to do something consequential here."
Citing lessons learned from his time working on the Recovery Act during the Obama administration, Biden reiterated, "We can't do too much here, but we can do too little."
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    The President also pushed back on Republicans' counterproposal for relief, which totaled to less than half of the $1.9 trillion White House plan. He signaled Friday afternoon that he would move forward with his proposal regardless of whether Republicans get on board.
    "I'd like to be doing it with the support of Republicans. ... But they're just not willing to go as far as I think we have to go," Biden said during a speech at the White House.
    "(It's) my preference to work together, but if I had to choose between getting help right now to Americans who are hurting so badly and getting bogged down in a lengthy negotiation, or compromising on a bill that's up to the crisis, it's an easy choice. I'm going to help the American people hurting now."
    "I know some in Congress think we've already done enough to deal with the crisis in the country," he added. "Others think that things are getting better, we can afford to sit back and either do a little, or do nothing at all. That's not what I see, I see enormous pain in this country."
    The President also appeared to take issue with what Larry Summers, the former director of the National Economic Council during the Obama administration, wrote in a recent Washington Post column about the Biden plan.
    Summers warned of issues in the plan that could impact financial stability and the value of the dollar, saying that implementing the stimulus could lead to unprecedented inflationary pressure and highlighting that the proposed stimulus is three times as large as the projected shortfall.
    Biden said Friday morning, "It's not just the macroeconomic impact on our economy and our ability to compete internationally. It's people's lives. Real, live people are hurting and we can fix it."
    And during comments Friday afternoon, Biden also asserted that his plan is better for the US economy long term, citing Wall Street, think tank and federal analysis.
    "It not only addresses the immediate crisis that we're in, it's better for the long-term economic health of our nation and our competitiveness," Biden said. "There's also a growing chorus of top economists, right, center, left, that say we should be less focused on the deficit and more focused on the investments we make and can make now."
    The jobs report released Friday morning indicated that 49,000 jobs were added in January, but the country is still down nearly 10 million jobs since before the coronavirus pandemic. It also showed that the unemployment rate fell to 6.3%, beating economists' expectations, marking the first decrease in two months.
    White House Council of Economic Advisers member Jared Bernstein also criticized Summers's assessment in an interview on CNN Friday.
    "I think he is wrong in a pretty profound way about that claim in the following sense and there's a way in which Larry's offering a warning that we've already heeded. ... I very much disagree with the thrust of the argument is that we have to go big and we have to go bold here to finally put this crisis, to finally put this virus behind us and to finally and reliably launch a robust, inclusive and racially equitable recovery," Bernstein told CNN's Poppy Harlow.
    "We have consistently said the risks of going to small are much greater than the risks of too much. Now that doesn't mean there are no risks engaged in the kind of work that we're doing because that's always the case in the economy," he added.
      "But what Larry is worried about here is inflation overheating," Bernstein said. "And right now, we have inflation that's been below the Fed's target rate of 2% for well over a decade."
      Bernstein also said that Summers' assertion that the Biden administration "was being dismissive of any potential inflationary pressures" was "flat out wrong."

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