Economy

There It is

SK Ashby
Written by SK Ashby

That didn't take long.

I was not necessarily stepping out on a long limb when I casually predicted that Republicans would point toward today's jobs report and say we don't need more stimulus, but that's exactly what they're doing now.

Trump's advisers say we don't need more spending and Senate Republicans say this is proof that we can wait.

"We certainly don’t need any new spending. We’ve already spent over $2 trillion. So we don’t need another spending bill for sure," [Trump adviser Stephen Moore] told NBC News. "We are in the recovery stage and we're no longer in the contraction stage."

"I don't think you're going to see any support among Republicans for a bailout of states and cities," he said. "The most important thing now is to get rid of the extra unemployment benefits that are so discouraging to work and unfair to people who are working." [...]

"The jobs report underscores why Congress should take a thoughtful approach and not rush to pass expensive legislation paid for with more debt before gaining a better understanding of the economic condition of the country," [Senator Chuck Grassley] spokesman Michael Zona said.

Regarding "bailouts for states and cities" -- job cuts at the state and local level are even higher than they were during the Great Recession.

Even as businesses hired employees back as much of the nation started reopening, the number of workers on state and local government payrolls fell by 571,000 to 18.3 million in May, according to U.S. Bureau of Labor Statistics data released Friday. That pushed the number of job cuts to about 1.5 million over the past two months, roughly twice as many as were ushered in after the last economic contraction over a decade ago.

Republicans and the Trump White House are playing a dangerous game of chicken for strictly political purposes. They're trying to project total confidence because they want voters to believe in a miraculous recovery, but they're also hoping things don't get too bad for their confidence to fall apart.

We haven't seen the end of job cuts at the state and local level as most locations haven't hit their hard spending caps or balanced budget laws yet. And I don't know if I have to point this out, but one reason why local governments are facing such a shortfall is because the Trump regime stood by and did virtually nothing when the pandemic arrived. The White House told the states they were on their own and they responded accordingly.

Congressional Democrats responded to today's news by saying we need to pass funding for cities and states and other stimulus measures to make sure any recovery actually holds.

I think Republicans are calculating that they can limp into the election without any care if a recovery holds.

If Congress does end up passing another spending bill, I wouldn't expect to see it until the end of July before their summer recess.