Larry Kudlow, President Donald Trump’s top economic advisor, said Tuesday afternoon that the broad economic recovery from Covid-19 doesn’t necessarily require additional fiscal stimulus even if select industries or businesses could benefit from more aid.
“I don’t think the V-shaped recovery depends on the package, but I do think a targeted package could be a great help,” Kudlow said from the White House on CNBC’s “The Exchange.” “Even though I think the economy is improving nicely, it could use some help in some key, targeted places.”
Kudlow, director of the National Economic Council, added that the White House has for weeks championed more funding for schools and the Paycheck Protection Program, a facility established by the Cares Act earlier this year that provides loans to small businesses so long as employers agree to use the funds to keep staff on payrolls.
He also acknowledged that while the overall U.S. economy appears to be in the middle of a comeback after a recession, there are still industries that are suffering as a result of the virus and efforts to contain its spread.
“We also wanted to extend the assistance plan, the PPP plan, to small business. I mean, we actually had money – it’s over $100 billion – that could be repurposed to go back in through that plan,” Kudlow added. “I think that plan was very effective. I think it did save, perhaps, 50 million jobs.”
“Unfortunately, we couldn’t reach agreement with the other side. And that was before the judicial issues came up,” he added. “I wish we could break the stalemate.”
Kudlow’s suggestion that the U.S. economy could continue in a sharp rebound without further aid appeared to mark a deviation from statements made by both Federal Reserve Chairman Jerome Powell and Treasury Secretary Steven Mnuchin just hours earlier.
In testimony before the House Financial Services Committee, both Mnuchin and Powell suggested that additional stimulus may be needed — especially in certain industries — until Americans resume their everyday business per usual.