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Leading Economists, Including Former Top Trump Advisor,
Praise the American Rescue Plan and Stress Urgency of
Additional Economic Relief
Special to The Truth
Support continues to grow
for President Biden’s American Rescue Plan, including among
leading economists who recognize the need for urgent action
to combat the economic damage being wrought by COVID-19, get
relief and support to the families and communities who have
been hit hardest by the pandemic, and ramp up vaccinations,
testing, and public health capacity so we can get the virus
under control.
In an interview with CNN on
Thursday, Kevin Hassett, a former top economic advisor to
President Trump, expressed support for the American Rescue
Plan and cautioned against the risks of failing to act,
saying “I think we need to be risk averse … There are so
many businesses treading water, barely hanging on. Now they
are getting hit by another shock.”
Hassett’s support was echoed
by dozens of economists surveyed by Reuters, which found
that over 90 percent of them believed that the American
Rescue Plan would “would boost the economy significantly.”
Moody’s Analytics, in an independent analysis, similarly
found that the Rescue Plan would help create 7.5 million
jobs in 2021, double economic growth, and return the U.S. to
full employment a full year faster.
The urgency to act was
underscored this week with new figures from the Department
of Labor showing that nearly 900,000 workers for filed for
unemployment benefits, and coming on the heels of previous
economic data showing that the United States lost jobs in
December.
Former Trump economic
adviser Kevin Hassett broadly supports President Joe Biden's
$1.9 trillion rescue package as a way to keep the
coronavirus-ravaged economy afloat.
"They've thrown a lot of
stimulus at it," Hassett told CNN Business on Thursday, "but
I think we need to be risk averse."
The former Trump
administration official fears that without more aid from
Washington, the worsening pandemic will cause the US economy
to suffer a repeat of the first quarter of last year, when
GDP shrank by five percent.
"There are so many
businesses treading water, barely hanging on. Now they are
getting hit by another shock," said Hassett, who served as
Trump's top economic adviser from 2017 to 2019 before
returning in a voluntary role in March of last year. "You
could end up in a negative spiral for the economy."
Biden’s proposed fiscal
package will boost the coronavirus-hit economy
significantly, according to a majority of economists in a
Reuters poll, and they expect it to return to its
pre-COVID-19 size within a year.
Biden has outlined a $1.9
trillion stimulus package proposal to jump-start the world’s
largest economy, which has been at the epicenter of the
COVID-19 pandemic having lost over 400,000 lives, fueling
optimism and sending Wall Street stocks to record highs on
Thursday.
Hopes for an upswing in U.S.
economic growth, helped by the huge stimulus plan, was
reflected in the Jan. 19-22 Reuters poll of more 100
economists.
In response to an additional
question, over 90 percent, or 42 of 46 economists, said the
planned fiscal stimulus would boost the economy
significantly.
“There are crosswinds to
begin 2021 as fiscal stimulus helps to offset the virus and
targeted lockdowns. The vaccine rollout will neutralize the
latter over the course of the year,” said Michelle Meyer,
U.S. economist at Bank of America Securities.
“And upside risks to
our...growth forecast are building if the
Democrat-controlled government can pass additional stimulus.
The high level of virus cases is extremely disheartening but
the more that the virus weighs on growth, the more likely
that stimulus will be passed.”
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