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.”
The comments appeared to push back on 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 added, “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.”
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.
Minutes before Biden spoke to reporters on Friday, White House Council of Economic Advisers member Jared Bernstein also criticized Summers’s assessment.
“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.”
“But what Larry is worried about here is inflation overheating,” Bernstein added. “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.”