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Top ‘White House ally’ sharply undercuts key Biden, Dem narrative on stalled economic recovery

Democrats and the Biden administration have attributed the blunted economic recovery, in part, to a lack of child care services for working parents. They have used the problem to push support for President Joe Biden’s American Families Plan, a massive legislative proposal that would cost taxpayers $1.8 trillion.

However, new analysis released by economic experts including Harvard professor Jason Furman, whom Politico described as a “prominent White House ally” and “Biden-friendly economist,” severely undercuts the Democratic narrative.

Jason Furman. (Andrew Harrer/Bloomberg via Getty Images)

After April’s shockingly disappointing job’s report showed the U.S. economy stalled last month — adding only about one-quarter of the 1 million jobs experts predicted — Democrats have called for Congress to act on Biden’s plan, and the White House has said lack of child care access is preventing parents from rejoining the workforce.

Politico reported:

Democratic officials have used the jobs report to call on Congress to urgently approve hundreds of billions of dollars in child care aid that Biden has proposed under the American Families Plan, which also includes two free years of universal pre-K. “If we don’t solve our child care crisis, there isn’t going to be an economic recovery,” Sen. Patty Murray (D-Wash.), who chairs the Health, Education, Labor and Pensions Committee, said at a Thursday press conference.

White House press secretary Jen Psaki told reporters earlier this month that passing the Families Plan “would have a huge benefit in addressing some of the impacts of child care, on educational needs … that is preventing women from rejoining the workforce.”

What did Furman discover?

The economic analysis co-authored Furman, who served as chairman of former President Barack Obama’s Council of Economic Advisers, found that child care challenges are not contributing to the stalled economic recovery.

“School closures and lack of child care are not holding back the recovery,” Furman said, Politico reported. “And conversely, we shouldn’t expect a short-term economic bump from reopening schools and making child care more available.”

In fact, the analysis discovered the employment rate for parents with young children decreased at a lower rate than the unemployment rate for people without young children, yet another indicator that child care challenges are not contributing to the stalled jobs recovery.

Instead, the analysis concluded that enhanced unemployment benefits is partly behind the disappointing economic numbers from April.

While school closures and ongoing childcare challenges have substantially burdened parents and children alike, they do not appear to be a meaningful driver of the slow employment recovery. This means that the factors responsible for the slow employment recovery and depressed labor supply are issues that are not exclusively related to the struggles of working parents, such as the continued concern about the threat of getting COVID-19 at work or expanded unemployment insurance benefits and eligibility.

Furman had said previously child care challenges and closed schools were contributing to poor economic recovery numbers.

How did the White House respond?

Jared Bernstein, a member of Biden’s Council of Economic Advisers, essentially dismissed the analysis, saying it “doesn’t obviate our concerns about the child care barrier either in the near-term or the long-term.”

“Many factors remain in play: fear of the virus, barriers to child care, school closures, concerns about the vaccination rates for working-age people,” Bernstein told Politico. “All of these factors are in the mix, and I don’t think you can find one piece of research that says, ‘Aha, here is the main factor or the sole factor.’ These factors are all interacting with each other as we continue making a gradual return back to pre-crisis conditions.”

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VIDEO: CNBC analyst so shocked by dismal jobs report numbers he had to double-check to make sure they were right

A CNBC analyst appeared to be so shocked by how grim April’s jobs report was that he needed to double-check the numbers to see if he read it correctly, video shows.

What are the details?

The Department of Labor released its official April payroll report on Friday, showing the U.S. economy added just 266,000 new jobs during the month, falling well short of forecasts that predicted the economy would add closer to one million jobs. Additionally, the unemployment rate shot up to 6.1%.

The report surprised many analysts on Wall Street who expected the economy would continue adding jobs at a steady rate as the coronavirus pandemic wanes — 536,000 new jobs were added in February and 770,000 were added in March.

Included among those caught off-guard by the anemic numbers was CNBC senior economic reporter Steve Liesman, who furiously checked his notes for different information while announcing the figure during “Squawk Box” on Friday.

“It just came across, give me a second here,” Liesman said as he apparently fumbled through notes.

“Ahh, sorry about that, it came across very quickly here,” he added in frustration before finding the report.

“It looks 266,000,” he then said defeatedly. “It looks like it was a big disappointment at 266, but maybe I have that wrong.”

“Let me double-check the [Bureau of Labor Statistics] website here,” he continued in disbelief. Finally he confirmed, “Yes, 266 is correct … so we have some issues here.”

What else?

TheBlaze reported on Friday that “one major roadblock” highlighted by the jobs report is the inability of companies to fill open positions, largely due to the “relative attractiveness of expanded federal unemployment benefits, and the inability of some parents to resume full time work because schools in many parts of the country have not fully reopened for full-time in-person learning.”

In its coverage of the news, Bloomberg noted that even with the high unemployment numbers and low job growth, the number of available jobs in the country is approaching record levels.

Shortly after the report was released, the U.S. Chamber of Commerce called for an end to the $300 a week federal unemployment benefit, which was extended in the Biden administration’s recent coronavirus relief package.

“The disappointing jobs report makes it clear that paying people not to work is dampening what should be a stronger jobs market,” said the chamber’s chief policy officer, Neal Bradley, in a statement. “We need a comprehensive approach to dealing with our workforce issues and the very real threat unfilled positions poses to our economic recovery from the pandemic.”

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Economist Stephen Moore: US economic recovery under Trump is EXCEEDING even the most optimistic predictions

Many on the Left continue to bash President Trump for the state of the economy following the coronavirus lockdowns. But economist and member of Trump’s Economic Recovery Task Force, Stephen Moore, argues that America’s economic recovery under President Trump is exceeding even the most optimistic predictions.

“We’re way, way ahead of, not just where I thought we’d be, but where just about every economist [thought we would be],” Moore told Glenn Beck on the radio program Monday. “I’m the ultimate optimist and I never thought there would be this kind of recovery. It’s been what I call a ‘Super-V.”‘

Moore touted a record-breaking 33% growth in the nation’s GDP (gross domestic product) in the third quarter, as well as unexpectedly low unemployment numbers post-coronavirus lockdowns.

“Unemployment numbers are really pretty impressive,” Moore said. “Nobody really expected that. Most people expected we would have about a 15% unemployment rate now. Right now, we’re at 7.9%.”

Moore also updated Glenn on how the recovery is going for the average American family, and gave his predictions for election night, including the reason he “can’t sleep at night.”

Watch the video below:

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A majority of COVID-19 lockdown business closures are permanent, according to Yelp data

Six months into the economic disruption of COVID-19 in the United States, Yelp has found that more than 60% of business closures that have occurred since March 1 have become permanent, CNBC reported.

Breaking down the numbers

From March 1 through Aug. 31, 163,735 businesses have changed their status to reflect closures on Yelp, one of the world’s most popular online business directories. That represents a 23% increase in closures since mid-July, indicating that while the health impact of the virus may be lessening in some places, the business impact is still severe.

Of those 163,735 businesses, 97,966 of them have been marked as permanently closed — nearly 60%. That number of permanent closures is a 34% increase since mid-July.

The peak number of closures Yelp tracked was early in the pandemic when the total number was about 180,000.

Hardest-hit industries

The restaurant industry has been the hardest-hit during the pandemic. As of Aug. 31, 32,109 restaurants had closed, according to Yelp data. Of those closures, 61% have become permanent. Many places, even New York City, are now allowing for indoor dining services, but capacity limitations can make it difficult for some restaurants to make ends meet.

The retail industry has seen 30,374 closures, with 58% of those being permanent. That’s a 10% increase in permanent closures since July.

Some places have gone through multiple rounds of lockdown restrictions, and the burden caused by those lockdowns led many business owners to determine that it was not worth trying to continue business under the new conditions.

“We did everything we were supposed to do,” said Mick Larkin, owner of a karaoke club in Wichita Falls, Texas. “When [Texas Gov. Greg Abbott] shut us down again, and after I put out all that money to meet their rules, I just said, ‘I can’t keep doing this.'”

Impact in different locations

States that rely heavily on tourism, such as Hawaii and California, have suffered the most during the pandemic. In terms of closures per capita, Hawaii and California have been hurt the most, followed by Nevada, Arizona, and Washington state.

Large cities saw higher rates of closure than small cities and towns. Los Angeles and New York City led the way with 15,000 and 11,000 closures, respectively. Half of Los Angeles’ closures are permanent, as are 63% of New York City’s.

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US adds 1.4 million jobs, unemployment rate drops — but there’s a long way to go to full recovery

The unemployment rate dropped into the single digits for the first time since March and the economy added 1.4 million jobs in August as a potentially long economic recovery from the early effects of the COVID-19 pandemic continues.

“We are still moving in the right direction and the pace of the jobs recovery seems to have picked up, but it still looks like it will take a while — and likely a vaccine — before we get back close to where we were at the beginning of this year,” said Tony Bedikian, head of global markets at Citizens Bank, according to Fox Business. “We continue to be optimistic that the economy has turned a corner and that we’ll continue to see steady progress.”

Unemployment drop exceeds expectations

The unemployment rate dropped from 10.2% to 8.4% in August. Economists had projected it to drop to 9.8%. The unemployment rate was as high as 14.7% in April, when most of the United States was locked down during the peak of the COVID-19 outbreak.

The unemployment was at a decades-low 3.5% in February, before the COVID-19 lockdowns began in the U.S.

Slow(er) but steady job growth

After 2.7 million jobs added in May and another 4.8 million added in June, job growth has slowed down in the past two months, indicating the potential for a longer-term economic recovery rather than a quick bounce-back.

The economy added 1.4 million jobs in August, which follows a gain of 1.8 million in July.

In August, the retail industry added 249,000 new jobs, professional and business services added 197,000 jobs, and leisure and hospitality added 174,000 jobs.

The furlough factor

The number of people who are on temporary layoffs has continued to decline. That number dropped by 3.1 million down to 6.2 million in August, after peaking at 18.1 million in April when businesses were shutting down for an indefinite period of time in an attempt to slow the spread of COVID-19.

Some of those furloughs, however, are becoming permanent. The number of people who have gone from temporary job loss to permanent job loss rose to 3.4 million, which is an increase of 534,000.

More stimulus needed?

Congress has gotten nowhere in negotiations for another COVID-19 economic stimulus package, something President Donald Trump has repeatedly said he wanted. Democrats in the House passed a $3.4 trillion bill months ago, while Republicans and the White House want something closer to $1 trillion.

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New York Democrat Chuck Schumer admits schools have to open or the economy won’t recover

Senate Minority Leader Chuck Schumer admitted Friday that regardless of any other COVID-19 relief efforts, the economy won’t be able to recover unless the schools are opened, according to The Hill.

Schumer, along with House Speaker Nancy Pelosi (D-Calif.) have been locked in negotiations with the White House and Republican leadership, trying to agree on a COVID-19 economic relief package. Those talks have stalled, and Schumer criticized Republicans for not being willing to spend enough to help the country, which he said includes funding to help schools reopen safely.

“If we don’t open up the schools, you’re going to hurt the economy significantly because lots of people can’t go to work,” Schumer said. “Executive orders leave out schools altogether.”

White House chief of staff Mark Meadows and Treasury Secretary Steve Mnuchin told reporters Friday that President Donald Trump will use executive orders to address some economic issues, including unemployment benefits, rental foreclosures, and student loans.

A timeline is not set for when such orders might be signed, but they could be done over the weekend, according to The Hill.

“It’s going to take a little bit of time for us to finalize these and process them but we’ll do them as quickly as we can because the president wants action,” Mnuchin said.

Schumer’s stance on school reopening is surprising, considering public polling has indicated that the issue of whether to reopen schools has been split down partisan lines, with Democrats favoring online instruction and Republicans favoring reopening schools for in-person classes.

The country is deeply divided over how to proceed with schools, with 55% of respondents opposed to reopening in the fall. At the same time, 59% of parents say they’re concerned about their children falling behind because of school closures.

Most Republicans, 79%, support schools reopening in the fall, while most Democrats, 78% want schools to operate remotely during the fall semester. Most schools across the country closed in the second half of March or early April in the spring.

The American Federation of Teachers, one of the largest teachers unions in the U.S., authorized local chapters to go on strike if schools reopen with plans not approved by the union. The AFT has approximately 1.7 million members. Teachers have held protests around the country claiming that many children and teachers could die if schools reopen.

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May report shows biggest jobs increase of all time, lower-than-expected unemployment rate

A surprisingly positive May jobs report showing the largest month-to-month job increase in history indicated that the United States appears to recovering from the COVID-19 outbreak from an economic as well as a health perspective, CNBC reported.

Despite being projected to decline by 8.3 million by some economists, non-farm payrolls actually increased by 2.5 million in May, a record turnaround after two of the most catastrophic unemployment months ever caused by COVID-19-related economic shutdowns.

The unemployment rate dropped from 14.7% in April to 13.3% in May, much better than the projected 19.5% unemployment projected by economists surveyed by Dow Jones. From CNBC:

As it turned out, May’s numbers showed the U.S. may well be on the road to recovery after its fastest plunge in history.

“It seems the damage from the nationwide lockdown was not as severe or as lasting as we feared a month ago,” said Scott Clemons, chief investment strategist at Brown Brothers Harriman.

President Donald Trump, whose re-election prospects may be at least somewhat dependent on the health of the economy, reacted positively to the jobs report from the Bureau of Labor Statistics.

“It’s a stupendous number,” Trump wrote Friday morning on Twitter. “It’s joyous, let’s call it like it is. The market was right. It’s stunning!

“It is a stunner by any stretch of the imagination,” he wrote in a follow-up tweet.

The U.S. is still hovering around 1,000 reported coronavirus deaths each day, and roughly 20,000 new cases per day, but even the hardest-hit areas of the country are taking steps toward reopening.

The COVID-19 outlook in the U.S. is complicated some by the mass protests that have occurred across the country over the past week. Because of the incubation period for the virus, we won’t know what impact those gatherings have on the spread of the virus for several weeks.