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Gary Cohn, President Donald Trump’s former top economic adviser, advocated for another round of federal coronavirus relief funding aimed at supporting smaller businesses and school systems disrupted by the pandemic on Thursday.
In an interview at The 2020 Texas Tribune Festival, Cohn disagreed with his successor, Larry Kudlow, who recently said a stimulus package passed by Congress is not necessary for a strong economic recovery.
“We still have a major, significant economic issue in this country,” Cohn said. “When you look at small and medium size businesses, you look at anyone involved in the travel, leisure, hospitality, entertainment industry, they are suffering.”
Cohn said that the economy will be hamstrung by having so many people in those industries out of work.
“And until we find a way to bring that industry back and many other small, local businesses, we’re not going to be in a huge, strong, deep economic recovery,” he said.
When the pandemic began significantly upending the American economy in March, Congress passed a massive package worth more than $2 trillion that “threw money at everything, threw money in every place we thought we needed to,” Cohn said, speaking with Stephanie Ruhle, NBC News Correspondent and anchor for “MSNBC Live.”
“The first round of economic stimulus was important,” said Cohn, who was also director of the White House's National Economic Council. “But I think we are going to need more stimulus, especially for some of our small businesses to get to the other side.”
Most of the federal money from the first and only package that was distributed to businesses and unemployed people across the country has expired, and nearly 2 million Texans are left still receiving anywhere from as little as $69 to as much as $521 per week in regular unemployment money, depending on the hours and pay of their most recent job.
But the number of jobless Texans is likely higher than what’s recorded — The Texas Workforce Commission has been inundated with large volumes of phone calls for months and is still unable to meet all inquiring Texans seeking unemployment relief.
Since the pandemic gripped Texas, more than 3.5 million Texans have filed for unemployment relief, according to the latest figures released Thursday.
Texans looking for work may not be able to turn to a small, local business and instead may have to look at larger companies — an “unintended consequence” of the pandemic, Cohn said. Companies like Home Depot and Walmart remained open throughout the pandemic, Cohn said, while smaller businesses were forced to close, giving big businesses “100% of the market share.”
“We told all those small retail establishments in the United States: You have to shut down because you’re not essential,” Cohn said. “Those small businesses are now finally starting to be able to reopen if, and only if, they were able to survive this long — literally five or six months with no ability to earn a dollar of revenue. Now they’re trying to fight for their market share back from the big companies. The big companies are not gonna give that market share back without a fight.”
While businesses fight to remain afloat, Congress is more focused on campaign season leading up to the November elections and preparing to vet the next nominee for the U.S. Supreme Court, Cohn said, and not economic improvements for the recession.
“Unfortunately, I think that nothing will happen probably until next year,” he said.
If priorities change before then, Cohn said the country could see benefits from another stimulus legislation from Congress, especially if it helps schools.
“We’re going to have a huge return on investment from the children of this country being educated,” Cohn said. “They’re going to join the workforce, they're gonna be productive and they're going to pay income taxes. And they're also gonna be able to start businesses and hire new people on their own.”