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Joe Biden vows to seek trillions of dollars in new stimulus

Joe Biden vowed to press ahead with trillions of dollars in new economic stimulus once he enters the White House, after Democrats won control of the Senate and data underscored how the labour market is faltering.

Speaking at his home base in Delaware on Friday, the president-elect said that the latest economic indicators, including net job losses of 140,000 in December, highlighted the urgency of the plan.

“It is necessary to spend the money now,” Mr Biden said. “It will be in the trillions of dollars, the entire package . . . in order to keep the economy from collapsing this year, getting much, much worse, we should be investing significant amounts of money right now to grow the economy.”

Mr Biden’s election platform called for $3.9tn in spending over his first term, according to a Moody’s Analytics estimate of the price tag. He is expected to try to accomplish much of that early in his administration given the state of the economy, which has been hammered by the coronavirus pandemic.

Even though Congress just passed a $900bn economic relief bill, its impact is expected to fade in the spring. Mr Biden has called it a “down payment” compared with the action that is needed.

The incoming president’s economic officials have said their top priorities are beefing up stimulus cheques to households, aiding states and local governments, and extending emergency unemployment benefits.

Beyond that, they have stressed the need for investments in clean energy, infrastructure, education and healthcare — to be partly financed by higher taxes on the wealthy and corporations. Mr Biden said he would be providing more details of his package next week.

But he already faced one obstacle in seeking broad economic stimulus. Joe Manchin, the centrist Democratic senator from West Virginia, said he was sceptical of the need to send a new direct payment to Americans.

The last relief bill included $600 cheques for most people, but Mr Biden — along with many Democrats and some Republicans — is trying to raise that to $2,000.

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“I don’t know where in the hell $2,000 came from. I swear to God I don’t. That’s another $400bn dollars,” Mr Manchin told The Washington Post. “I don’t ever remember [Franklin Roosevelt] . . . sending a damn penny to a human being. He gave ’em a job.”

Mr Biden touted his stimulus plan as he announced more nominees to serve on his economic team, including Gina Raimondo, the governor of Rhode Island, as commerce secretary and Marty Walsh, the mayor of Boston, as labour secretary.

Democratic control of the Senate — clinched this week after two run-off races in Georgia — has given new energy to Mr Biden’s legislative ambitions on the economy. But he may still struggle to forge a plan that can both pass a closely divided Congress and satisfy the leftwing of his party, which is clamouring for bold action.

The jobs report released on Friday may make the case easier. It showed the economy, and particularly the leisure and hospitality sector, struggling to cope with the new surge in coronavirus cases. The economy is still nearly 10m jobs short of its pre-pandemic employment levels.

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