WASHINGTON – President-elect Joe Biden said on Friday that he favors putting aside concerns about the federal deficit to spend more money to boost the struggling American economy.
“Every great economist thinks we should invest in deficit spending to generate economic growth,” Biden told reporters on Friday, citing the Federal Reserve’s low interest rates and limited powers to fix the Covid-19 crisis.
As this city reels with the chaos of a deadly Capitol riot spurred by President Donald Trump, Biden said he will present an economic aid package this year that will cost “in the trillions of dollars”. He said it will include emergency relief for those affected by the pandemic, as well as investments in infrastructure, health and “a number of things that will generate well-paying jobs”.
“If we don’t act now, things will get much worse and more difficult to get out of the hole later. So we have to invest now,” said Biden. “There is a terrible need to act now.”
Biden’s comments came two days after Democrats were designed to take control of the Senate, giving them the power to set the agenda in both chambers. The comments indicate that he and his party will be less inclined than during the Obama administration to agree to Republican demands to limit new spending because of the national debt.
The president-elect suggested he believed that the $ 900 billion pandemic relief package approved by Congress last month would not be enough. His comments were well received by progressives who have been skeptical of his moderate instincts and concerned about the deficit.
Senator Bernie Sanders, I-Vt., Runner-up in the 2020 Democratic primaries and likely incoming chairman of the Senate Budget Committee, praised Biden’s comments in an interview on Saturday.
“The president-elect is exactly right in saying that this is not the time for austerity policies,” Sanders told NBC News. “We cannot maintain the economic austerity that has allowed the very wealthy to do phenomenally in this country while workers suffer.”
Sanders is prepared to oversee the budget reconciliation process, which is not subject to obstruction. Democrats, who will take control of the Senate 50-50 with the vice-president-elect Kamala Harris as the tiebreaker, will be able to approve taxation policies and spending on a majority vote.
Democrats will have a narrow majority in both chambers, which will restrict their ambitions even in reconciliation. And on most items, Senate Republicans will retain the ability to obstruct and force a 60-vote limit, meaning that progressives’ biggest ambitions are unlikely to go far.
Sanders said he is looking at a “bold” agenda that includes $ 2,000 stimulus payments, improved unemployment insurance, access to childcare, action on climate change, student debt mitigation and “very significant investments in expanding health care” , including lowering the Medicare eligibility age from 65 to 60.
The Vermont senator asked his colleagues to aim big or risk a repeat of Obama’s first half-term election, when Republicans won big wins in Congressional contests because, as Sanders says, voters “judged that the Democrats have done nothing close enough “to improve their lives.
“We have to act with a boldness that we have not seen in this country since FDR,” said Sanders. “If we don’t, I suspect that two years will not be the majority.”
In addition, House Democrats have adjusted House rules to facilitate passage of legislation that increases the deficit if it relates to “economic or public health consequences of the pandemic; and measures to prevent, prepare for or respond to economic, environmental problems. , or public health consequences of climate change, “according to an official summary.
In the short term, at least, some fiscal-conscious Democrats say they are willing to put aside fiscal concerns to tackle the pandemic-induced economic crisis. One said he was willing to put aside the pay-as-you-go system, known in Congress as PAYGO, an austerity measure that requires new expenses to be paid for with available funds, rather than borrowed money.
“I believe in PAYGO. I think you have exemptions for PAYGO in crises, which is why those of us who believe in balanced budget amendments believe that there are always exceptions to crises, “said Representative Josh Gottheimer, DN.J., co-chair of the Problem bipartisan Solvers Caucus. “A pandemic is a crisis. We’re going to have to go through this. If you don’t really invest in helping the country through this, you will pay a much higher price in the end. “
