Exclusive: Summers and other stimulus naysayers 'ignoring reality' – top Biden economist Boushey

FILE PHOTO: Heather Boushey, appointed to be a member of the Council of Economic Advisers, speaks as U.S. President-elect Joe Biden announces nominees and appointees to serve on his economic policy team at his transition headquarters in Wilmington, Delaware, U.S., December 1, 2020. REUTERS/Leah Millis/File Photo

WASHINGTON (Reuters) – A top White House economist on Friday said the latest jobs report underscored how important it is to keep paying enhanced unemployment benefits, and the need for a $1.9 trillion stimulus package being considered in Congress.

Heather Boushey, a member of the White House Council of Economic Advisers, rejected concerns raised by former Treasury secretary Larry Summers and others that the scale of the plan proposed by President Joe Biden risked driving up inflation.

“That argument ignores the reality of what today’s jobs numbers show, which is that … we’re seeing an economy that has been stalling,” Boushey said.

“The idea that we should pare back now, out of a future fear that maybe we might possibly do too much, just doesn’t seem consistent with the economic evidence we have in front of us,” she said. “The cost of inaction far outweighs the costs of perhaps doing a little bit too much.”

U.S. employment growth rebounded moderately in January and job losses in December were deeper than initially thought.

“Unemployment benefits are one of the first lines of defense in any recession,” Boushey said. “So this is absolutely imperative, and it really is imperative that benefits remain on for as long as workers need them.”

Boushey also stressed Biden’s commitment to raising the federal minimum wage to $15 an hour from $7.25, an increase she said would be phased in to avoid a shock to the economy.

Source: Read Full Article