White House economic adviser Larry Kudlow warned that parents who will need to stay home with children because of closed schools could put a damper on a V-shaped economic recovery.
"Kids should get back to school. Our watchwords here regarding any of these congressional negotiations are schools and kids," the veteran financial guru and former Ronald Reagan adviser recently told Fox Business Network.
The nation's schools are implementing a patchwork of policies about in-person classes because of coronavirus, Fox Business Network explained.
"We don’t have to spend a fortune, we just have to provide the necessary assistance,” said Kudlow, who worked as Reagan’s budget deputy between 1981 and 1985.
“There could be in certain areas some restraint on the recovery, on this V-shaped recovery, because parents may have to stay home," said Kudlow, who served as the Trump campaign's senior economic adviser.
"We're going to grow at 20% in the second half [of 2020]," Kudlow said on Wednesday. "The third quarter’s numbers are probably going to be better than 20%. There's a V-shaped recovery."
Meanwhile, lawmakers are at an impasse over stimulus negotiations, and that could mean further job losses as businesses close for good, with payrolls at risk of shrinking as soon as September. It could make Donald Trump’s road to re-election even tougher, with the president already trailing challenger Joe Biden in polls.
“The longer we go along without some sort of stimulus the higher the risk that we get a slowdown in terms of any job gains and could actually even go into reverse,” said Justin Weidner, an economist at Deutsche Bank AG. “It’s completely possible that that happens in September,” he told Bloomberg.
A slew of layoff announcements by major companies including MGM Resorts International, Coca-Cola Co. and United Airlines Holdings Inc. also implies weakness in the coming months. In recent weeks, global corporations have announced more than 200,000 job cuts or buyouts, according to data compiled by Bloomberg, suggesting that furloughs implemented early in the pandemic are becoming permanent.
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