National Economic Council director Larry Kudlow says President Trump “bears responsibility for the pluses and the positives” of the economy. He declined to weigh in directly on the bipartisan Senate $908 billion COVID relief framework.
Where is POTUS when Americans continue to suffer?
Larry Kudlow: There's still a lot of suffering out there, I agree. But I will also argue the economy has registered a very strong comeback from the peak of the pandemic contraction, including today's jobs numbers with the 6.7% unemployment right now. There are still over 10 million people who are jobless. And that's not good. That is a hardship. And by the way, that should be a target with any assistance package. However, at the peak it was 23 million. And now we got 150 Americans, 150 million Americans working. And that's way up – and the 10 million unemployed is way down. So I like that.
I want to say also look at terms of these numbers -- I know you're not going to get deep into the numbers -- but you still got a housing boom going on, consumer spending is strong. There's a lot of business and factory production going on. The ISM and the PMI were nearly 60%, that's a very healthy number if you look at that.
My friend, one of Wall Street's top economists Ed Hyman has his Christmas tree index. And that's growing at 29% year on year, a little holiday cheer. So, you know, I think we have much more work to do. I understand that, but I think we've come a long way.
Where is POTUS, his leadership on this?
Larry Kudlow: We're not gonna sell this here, but I would say to you, he has put together a remarkable infrastructure, in just a few months -- six or seven months -- to fight COVID. And it's a global event. I mean, all the countries are having the same problems but I will say this, his Operation Warp Speed, which he developed, led, and has produced is on the way.
And I just say that, help is on the way. Vaccines are a week or two away. We'll get 20 million-plus by the end of this month, 40 million by January, and up to 100 million late March, April. That's what the scientists are estimating with these great companies. His operation, we've poured billions of dollars into the vaccines, working with the private sector, and all the brilliant people involved in developing these vaccines. And the President opened that door, Operation Warp Speed, we've done in a handful of months that normally takes 10 years plus. I mean, I agree, I respect that. But I think he's done a tremendous job -- tremendous job on this project.”
What is the view of POTUS on the $908B Senate framework?
Larry Kudlow: We've always kind of wanted to talk policies, not dollars. We'll leave that leadership to Senator McConnell and Speaker Pelosi, they're talking, I would say it has a somewhat more optimistic tone. But the issues here again on policy, there's a couple of key targeted areas that our team, and the Senate leadership, want. Additions to Small Business PPP, some federal plus-up on unemployment assistance to deal with the hardship that we were discussing a moment ago. Some liability insurance curbs, which would help small businesses, help schools, help local governments. They could all be sued, very hard to trace these COVID breakouts. So those are some of the key points.
By the way, you've got roughly $600 billion that’s unspent to be redeployed and reappropriated …. (so on $908B topline), “I don’t want to go there, I'm going to leave that to Senator McConnell and Speaker Pelosi and others, we're in touch daily right now with everybody. That includes the Republican House leader, Kevin McCarthy.
Is it critical that a bill is passed in the lame-duck?
Larry Kudlow: I see no reason why we couldn't have done this last summer, early in the fall, particularly for small businesses and unemployment. And I would add to that, I know Senator McConnell is very keen on this, I think he's right. I think some liability insurance reforms would also help small businesses. Look, we want to keep the schools open. We want to keep the businesses open. And we know of specific targeted programs that would help that. And there's about 600 billion of unspent money. I'm not gonna call it free money, but it really doesn't represent additional spending.”
Does POTUS bear any responsibility for the jobs numbers?
Larry Kudlow: This is one month, six points -- look, go back, take a look at the CBO, and the Federal Reserve, where they had the jobless rate, at year-end and early next year. We are at least three percentage points below where those geniuses did. I call that a pretty good thing. And I will say again, the relief package, the bipartisan relief package, very helpful, but also fundamentally, this was a healthy economy, pre-pandemic.
“The basis, the roots of this were full of incentives, the tax cuts the deregulation, better trade deals. And so we're able to withstand this. Take a look at what's doing in Europe, I see the contrast. Take a look. And lots of parts of Asia. So does the president bear responsibility? I say the president bears responsibility for the pluses and the positives. And I know it's not common to give him that. But I'm going to make that defense.”
Would POTUS accept state and local aid funding in the bipartisan framework, around $160B?
Larry Kudlow: I will let the legislators work that out.
Will POTUS take any level of state and local since he’s been critical
Larry Kudlow: And he still is. And he still is. He doesn't want to deal with mismanaged states and localities, but I don't want to comment on it because I will leave that to the negotiations.”
How serious is POTUS about vetoing the defense authorization bill?
Larry Kudlow: Well, I will let him speak for himself but he has indicated that he would like to see a liability shield reform with respect to these social media companies. And I happen to agree. They're acting as editors and publishers. There are censorship issues that no one ever intended. Going back to this, this pertains to the 1996 telecom decency bill,as you know. And it looks to me like in this era of social media, that needs to be reformed, section 230 is the place to reform it. And I'm not going to give you the wording but I'm just saying that liability shield has got to be re-examined, at a minimum.
Now regarding the defense authorization bill, I'm not gonna – the president will make that decision. But I can tell you he continues to very much favor getting rid of this 230, section 230 liability issue.
Any thoughts on the ongoing UK-EU Brexit negotiations?
Larry Kudlow: Not today.
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