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        <title><![CDATA[Minneapolis Federal Reserve Bank boss Neel Kashkari: ‘Hard’ shutdown can save economy]]></title>
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        <link>https://usagag.com/2020/08/03/minneapolis-federal-reserve-bank-boss-neel-kashkari-hard-shutdown-can-save-economy/</link>
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            <media:title type="html">Minneapolis Federal Reserve Bank boss Neel Kashkari: ‘Hard’ shutdown can save economy</media:title>
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        <content:encoded><![CDATA[<p>Locking the country down &#8220;really hard&#8221; for a period of several weeks could save the economy from long-term pain, the president of the Minneapolis Federal Reserve Bank said Sunday.</p><p>In an interview with CBS&#8217; &#8220;<strong>Face the Nation</strong>,&#8221; Neel Kashkari said that the only way to have &#8220;a real robust economic recovery&#8221; is to quash the flare ups of the coronavirus that continue to pop up across the country.</p><p>Shutting things down &#8220;for a month or six weeks&#8221; would allow the nation&#8217;s case count to get low enough that the government&#8217;s testing and contact tracing efforts could effectively contain future spreading, Kashkari said, adding that if serious action isn&#8217;t taken the country will &#8220;have this raging virus spreading &#8230; with flare ups and local lockdowns for the next year or to.&#8221;</p><p>&#8220;We&#8217;re going to see many, many more business bankruptcies, small businesses, big businesses, and that&#8217;s going to take a lot of time to recover from to rebuild those businesses and then to bring workers back in and re-engage them in the workforce,&#8221; he added. &#8220;That&#8217;s going to be a much slower recovery for all of us.&#8221;</p><p>The US economy last week suffered its worst blow since the Great Depression, with the nation’s gross domestic product — the value of all goods and services produced here — 9.5 percent smaller in the second quarter than in the first.</p><p>More than 25 million Americans lost&nbsp;the $600 per week jobless payment bonus <strong>introduced at the height of the coronavirus crisis</strong> in March, after lawmakers failed to come to an agreement on the jobless benefits.</p><p>Democrats wanted to expand the $600 bonus until the first quarter of 2021, but the White House and GOP are advocating for a $200 payment, arguing <strong>the current rate is too high</strong> and discourages Americans from returning to work.</p><p>In the interview, Kashkari said that while he did think the $600 bonus could be a disincentive at some point, it would still be helpful now while tens of millions are out of work.</p><p>&#8220;There&#8217;s just so many fewer jobs than there are workers available,&#8221; he said. &#8220;When we get the unemployment rate eventually back down to 5 percent and we want to get it back down to 4 percent or 3.5 percent where it was before, yes, that disincentive to work becomes material.&#8221;</p>]]></content:encoded>
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