Virus Panel Demands White House File Economic Forecasts

WASHINGTON (CN) — With 40 million Americans unemployed and cases of Covid-19 cropping up at record rates in several states, the congressional watchdog tasked with overseeing the Trump administration’s response to the continuing pandemic wants answers from the White House about why it will not submit routine economic forecasts.

Members of the Select Subcommittee on the Coronavirus Crisis, a body created for the express purpose of investigating the trillions of relief dollars flowing through Congress to the American public, wrote to Treasury Secretary Steve Mnuchin on Thursday requesting the projections just ahead of a scheduled committee meeting centered on the economy. 

For the last four decades, the White House has typically released these figures ahead of what is known as a mid-session review for the federal budget.

Usually the findings are submitted in February. The Washington Post was first to report last month that White House officials speaking on the condition of anonymity confirmed the findings would indeed be held back. The reason, they reportedly said, is because the pandemic made economic models too volatile and unpredictable.

But subcommittee Chairman Jim Clyburn, D-S.C., said that if previous administrations managed to publish their reports during times of historic upheaval like during the financial crisis of 2007 and the subsequent recession in 2008, this time should be no different.

“Concealing economic forecasts from the American people during a jobs crisis is counterproductive and in conflict with bipartisan precedent and contrary to the intent of Congress,” Clyburn wrote in Thursday’s letter to Mnuchin as well as Tomas Philipson, acting chairman of the White House Council of Economic Advisers, and Russell Vought, acting director of the Office of Management and Budget.

The Treasury Department has until June 21 to respond but no threat of subpoena was issued. If it cannot meet the deadline next week, Clyburn wrote, then the committee will demand that the Trump administration produce all of its records related to economic projections from 2020 to 2030, including the unemployment rate forecast for the third and fourth quarters of this year.  

Without the regular economic forecasts, Clyburn’s committee also wants transparent estimates about gross domestic product, wages and salaries, home and car sales, domestic corporate profit, industrial production, rental vacancies and outstanding consumer credit data.

While White House economic adviser Larry Kudlow suggested  Sunday that the pandemic is winding down and that the economy is now in “the recovery stage,” Clyburn and other Democrats on the committee were deeply skeptical during Thursday’s hearing, with economists hauled in to testify about the uncertainty millions of workers find themselves in.

“If things are getting better and we are at a turning, point, I fail to understand why we cannot get the data. Why is it that they’ve stop putting out the data?” Clyburn said before remarking how Mnuchin, during an appearance just a week ago, told him he would be glad to share the data with the committee.

The Treasury Department did not immediately return request for comment.

Some 1.5 million new weekly unemployment claims were reported Thursday, with the Labor Department pegging unemployment at roughly 14%.  

But Jason Furman, professor of economic policy at Harvard University, said that number is realistically closer to 17.1%. Furman, who testified before the subcommittee Thursday, said the discrepancy is due to a correction made on classification errors when the numbers were tallied.

“Even if all the temporarily laid off people were brought back to work immediately, the unemployment rate still would have been 7%, the recessionary level,” he said.

The economic impact has been especially hard on African Americans and Latinos.

William Spriggs, chief economist for the AFL-CIO and professor of economics at Howard University, said the real litmus test determining that America has hit a “turning point” is whether black unemployment rates begins to drop.

“If we were actually at a turning point, the black unemployment rate tends to fall even faster,” he said.

But black employment is nearly 17% and rising. The same goes for the Latino community, where Spriggs said Hispanic women are seeing unemployment rates even higher, about 19%. White unemployment currently sits at 12.4%, according to the Bureau of Labor Statistics.

“During a recession, the black unemployment rate is very sticky because of labor market discrimination,” Spriggs said. “The black unemployment rate did not fall and that’s a sign of things to come that are worse for black workers.”

A pervasive lack of health insurance among these groups is only making things worse, he said. The data behind hospitalization rates shows it is black and brown communities that are being hit by Covid-19 the hardest.

Democrats on the committee said resolutions could be found if the Senate would consider passing the $3 trillion Heroes Act, which was approved by the House on May 15. The bill provides a host of unemployment benefits and extensions. Since the additional $600 weekly unemployment stipend included in the $2 trillion CARES Act is set to expire in July, the Heroes Act could be the life raft families need to stay afloat.

Michele Evermore, senior researcher and policy analyst at the National Employment Law Project, told lawmakers that the U.S. unemployment system is a confusing patchwork and some states have laws that are “intentionally modified to make it harder to get benefits.”

By narrowing eligibility and creating other hurdles, too few workers qualify for benefits that are already inadequate, she said.

The Heroes Act also proposes subsidizing private health insurance like COBRA, something Evermore said could help.  

“That might be worth doing again,” she said, noting how Congress approved it temporarily in previous recessions.

Congressman Jim Jordan, R-Ohio, bristled at the idea of another round of relief funding, saying Thursday repeatedly that another $600 for unemployed Americans would disincentive them from ever returning to work.

“That’s an insult. People want to work,” Clyburn responded. “The jobs are not there.”

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