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Federal Reserve Chair Jerome Powell Calls for Congress to Spend Stimulus Money

Jerome Powell, chairman of the Federal Reserve, gave a speech on Tuesday and, as a result, likely can expect a barrage of incoming tweets shortly. Put simply, Powell says that, due to the pandemic of which the president* told us not to be afraid, an economic calamity is looming unless a lot of somebodies in Washington get scared enough to freaking do something. From CNN:

A second wave of coronavirus could “more significantly limit economic activity, not to mention the tragic effects on lives and well-being,” Powell said. “Managing this risk as the expansion continues will require following medical experts’ guidance, including using masks and social-distancing measures.” In addition to gaining control of the pandemic, Powell reiterated his calls for more fiscal stimulus aimed at supporting America’s most vulnerable.

“Mo’ money,” says the Fed chair. “Mo’ money, mo’ money, mo’ money.”

Powell said Tuesday that the risks of Congress pouring too much stimulus into the economy are far lower than the risk of not doing enough. Although government spending is adding to an already sky-high federal budget, lawmakers should act, Powell argued. “The US federal budget is on an unsustainable path, has been for some time,” Powell said. But “this is not the time to give priority to those concerns.”

And the Fed chair bows to the Blog’s First Law of Economics: Fck The Deficit. People got no jobs. People got no money.

The Fed chairman also stressed once again that the burdens of the crisis haven’t been evenly distributed and that women, minorities and low-income workers are in a much worse position in this downturn than others. Unemployment and bankruptcies will always be part of the economy, he acknowledged. But having an “inappropriate” amount of either is bad for the longer term outlook. For example, the number of permanent layoffs has been rising after a large number of workers were initially classified has having temporarily lost their jobs. “Once you’re permanently laid off it’s just difficult to get back into the workforce,” Powell said.

And the Fed chair gives voice to his inner Bernie Sanders.

This is as vivid a red flag as anyone has waved at any point during our current tangle of crises, and it’s being flourished by a guy who looks like he drinks straight vinegar for breakfast. Powell is the polar opposite of wild-eyed. Not even someone as nutty as a Republican member of the House can call him a socialist. For Jerome Powell to say that “this is not the time” to worry about a balanced federal budget cuts the legs out from under Mitch McConnell, from whoever is pretending to run things at the White House these days and, truth be told, a lot of perpetually tremulous Democrats. Mr. Keynes? There’s a call for you on the house phone.

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