The Fed Is Right and Trump Is Wrong: Stimulus Can’t Wait
Fiscal support that’s too little or too late is a serious danger to the economy.
Apparently Trump knows better.
Photographer: Drew Angerer/Getty Images/Bloomberg via Getty Images
President Donald Trump has told his team to stop discussing a new stimulus package until after the election. He should pay closer attention to what Jerome Powell said to the National Association for Business Economics a few hours before. Without additional fiscal stimulus, Powell warned, the economic recovery might very well falter.
What the Federal Reserve chairman called “normal recessionary dynamics” — suppressed up to now thanks to powerful fiscal and monetary support earlier in the year — could easily set in. That means slower growth feeding mounting pessimism, in a vicious circle of contraction. There’s no need to take this risk. Partisan squabbling over new fiscal relief has been going on for months. Enough.