Fed's Kashkari calls for 6-week economic shutdown to control coronavirus spread
Neel Kashkari warns that the rest of 2020 could be much worse than what America has experienced so far
Neel Kashkari, president of the Federal Reserve Bank of Minneapolis, called for a nationwide economic shutdown for up to six weeks to get the coronavirus pandemic under control on Friday, warning that the rest of 2020 could be much worse than what America has experienced so far.
"The next six months could make what we have experienced so far seem like just a warm-up to a greater catastrophe. With many schools and colleges starting, stores and businesses reopening, and the beginning of the indoor heating season, new case numbers will grow quickly," Kashkari wrote in a New York Times op-ed with Dr. Michael T. Osterholm, the director of the Center for Infectious Disease Research and Policy at the University of Minnesota.
Kashkari echoed comments he made a week ago on CBS's "Face the Nation," when he argued that "if we were to lock down hard for a month or six weeks, we could get the case count down so that our testing and our contact tracing was actually enough to control" the spread of coronavirus.
President Trump has insisted that states resist the urge to roll back reopening. He said earlier this week when asked about Kashkari’s comments that the country is “not going back to shutdowns.”
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Aside from an economic shutdown, Kashkari also called Friday for more stimulus relief from the federal government.
"Congress should be aggressive in supporting people who've lost jobs because of Covid-19. It’s not only the right thing to do but also vital for our economic recovery," Kashkari and Osterholm wrote. "If people can't pay their bills, it will ripple through the economy and make the downturn much worse, with many more bankruptcies, and the national recovery much slower."
But a stalemate in Congress has stopped any economic relief from being passed. House Democrats passed the $3 trillion HEROES Act in May. Senate Republicans countered with a $1 trillion plan of their own, and the two sides have not been able to come to an agreement on much of anything since then.
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Trump decided to take unilateral action as a result of the impasse. He signed four executive actions Saturday from his Bedminster, N.J., golf club.
One was a $400-per-week supplemental unemployment benefit -- $300 of which will be footed by the federal government, while states are expected to pay the other 25%.
He also announced a payroll tax holiday for people making less than $100,000 a year through the end of 2020, as well as extensions of student loan relief and protection from evictions.
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