Laffer Associates chairman Art Laffer explains how additional coronavirus spending could damage economy.
While Democrats work on a $1.9 trillion coronavirus relief bill to get to President Biden by next month, there are rumblings that another multitrillion-dollar package could follow.
The Washington Post reported this week that discussions have already begun regarding a $3 trillion bill, which would include Biden’s previously detailed plans for infrastructure, manufacturing revitalization, and green energy.
When asked whether a $3 trillion package would follow the $1.9 trillion relief bill, White House Press Secretary Jen Psaki said on Thursday that there are ongoing discussions about possible future agenda items – though no firm decisions have been made.
Three people familiar with the matter told The Post that the $3 trillion figure was being kicked around for the second bill, which would be on top of a potential $1.9 trillion and $4 trillion spent under the former administration. Spending figures, however, are said to be very preliminary.
Some government officials, however, are less concerned with mounting debt levels and more worried about getting the U.S. economy and American families back on their feet.
COVID RELIEF SPENDING HAS SAVED US ECONOMY FROM 'GREAT RECESSION', STEVEN MNUCHIN SAYS
As previously reported by FOX Business, former U.S. Treasury Secretary Steven Mnuchin said during his first post-White House television interview with Larry Kudlow earlier this week that spending on relief measures had saved the U.S. from a “great recession.”
Mnuchin counted four relief bills passed under his tenure – and said he would prefer to see one or two more, depending on what is necessary.
When it comes to conservative concerns about spending, Mnuchin said current conditions fly in the face of traditional economic models because the ongoing recession is not “economically driven.”
“So I’ve felt all along we need to spend what we need to spend,” Mnuchin said.
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The caveat, however, is that the former Treasury Secretary said he would like to see legislation passed on a bipartisan basis – and not pushed through with a simple majority via the reconciliation process.
Federal Reserve Chair Jerome Powell was asked about the ballooning federal budget deficit during a recent conference and he said that while the U.S. deficit is on an unsustainable path, now is not the time to remedy that issue. Rather, policymakers should address the deficit when employment and U.S. economic growth are strong.
FOX Business’ Blake Burman contributed to this report.
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February 19, 2021 at 08:10AM
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