Biden spending plan a ‘mystery’ amid ‘tremendous’ economic recovery: Douglas Holtz-Eakin
Former CBO Director and American Action Forum President Douglas Holtz-Eakin gives his take on President Biden’s proposed budget.
President Biden cited the May jobs report on Friday as evidence that his economic plan is working and the U.S. is poised for a full recovery from the coronavirus pandemic, even though employers hired fewer workers than expected last month.
"None of this success is an accident," Biden said during brief remarks in Rehoboth Beach, Delaware. "It isn't luck … It's due in no small part to the bold action we took with the American Rescue Plan. This is progress that's pulling our economy out of the worst crisis in the last 100 years."
The Labor Department said in its Friday report that employers added 559,000 jobs last month and the unemployment rate fell to 5.8%, missing Wall Street's expectations for a gain of about 650,000. Still, it marked a vast improvement from April, when the economy added a revised 278,000 jobs – much smaller than the 1 million forecast by Refinitiv economists.
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Biden touted the report as "great news for our economy," though he cautioned there will be "some bumps" on the path to a complete rebound. There are still about 7.4 million fewer jobs than there were in February 2020, before the pandemic began. The president argued the report highlights the need for Congress to pass his $1.8 trillion American Families Plan and $2.3 trillion American Jobs Plan, both of which would dramatically reshape the government-funded social safety net while rebuilding the nation's crumbling infrastructure.
"Because while progress is undeniable it is not assured. That's why I propose the American Jobs Plan and the American Family Plan for generational investments," he said. "We need today, we need to make those investments today to be able to continue to succeed tomorrow."
Democrats and Republicans are already using the report to either support or criticize Biden's $4 trillion tax and spending plans that he unveiled earlier this year.
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"As we emerge from the virus, our economy should be booming, but today's lackluster jobs report shows President Biden's policies have stalled our recovery," House Minority Leader Kevin McCarthy, R-Calif., tweeted after the report was released.
GOP lawmakers have argued the $300-a-week unemployment benefit included in the latest stimulus package has hindered job growth by disincentivizing Americans from returning to work. Experts say there are multiple reasons for the anemic job growth, including safety concerns over contracting COVID-19, a lack of child care options and the boosted jobless aid.
Although some Democrats want to extend the sweetened aid beyond September, when it's poised to expire, Biden indicated on Friday that he does not think that's necessary.
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"A temporary boost in unemployment benefits that we enacted helped people who lost their jobs through no fault of their own, and who still may be in the process of getting vaccinated," he said. "But it's going to expire in 90 days — it makes sense it expires in 90 days."
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