“They have thrown in a lot of stimulus, but I think we need to avoid taking the risk,” Hassett told CNN Business Thursday.
“There are a lot of companies treading water, barely suspended. “You could end up in a negative spiral of the economy.”
“The disease is spreading at an amazing and frightening rate,” said Hassett, now a senior visiting fellow at the Hoover Institution at Stanford University.
Biden’s $ 1.9 trillion plan
Lindsay Bigga, Stifel’s chief economist, worries that the federal government is rushing too quickly to allocate more money to solve the problem.
“I would like to see a smaller and more targeted approach because we are seeing the economy evolve and adapt, rather than relying on additional helicopter money,” Bizga said.
For his part, Hassett said there may be elements of Biden’s package that he loves the most In general, he “fully” supports the plan.
How vaccines and the epidemic affect the economy
The pandemic is clearly doing real damage to the economy, especially in virus-sensitive industries such as restaurants, movie theaters, hotels and cruise lines.
The slowdown in vaccine rollout threatens not only to extend the health crisis, but also the economic crisis.
The acceleration of vaccine deployment is complicated by logistical problems and the disastrous transition between the Biden and Trump administrations.
Somewhat unexpectedly, Hassett fears the US economy will suffer another blow when vaccine distribution speeds up. He explained that the people who follow him in line to get a vaccine, or who have already received one dose, will be very careful to avoid infection.
“If you hid in your basement for three weeks, you know you’ll be fine,” Hassett said. “There will be a massive increase in risk aversion. We should expect the economy to be really slow – even if the government doesn’t ask for further lockdowns.”
Hassett predicted that after some bargaining, Congress will pass another major stimulus package next month. And he indicated that Congress and the Trump administration came close to a $ 2 trillion stimulus package last fall.
“Now that the elections are over, people can only focus on what is good for the country,” he said.