During an interview with Bloomberg on Wednesday, Deputy Treasury Secretary Wally Adeyemo responded to California giving out stimulus checks to deal with higher gas prices by stating that the Biden administration has called on states to use the money on workforce training and affordable housing, but “States are going to have to make decisions based on what their people need.” Adeyemo also declined to predict whether California’s plan would be inflationary.
Adeyemo said, [relevant remarks begin around 1:27:40] “[W]e’re also calling on state and local governments to use their remaining American Rescue Plan money to invest in two things: One is worker training for those employees who are still on the sidelines to up labor force participation and two is to invest in affordable housing.”
Co-host Taylor Riggs then asked, “Let’s talk about those state and local governments, California, of course, one giving out further stimulus checks to help individuals really cope with higher gas prices. Do you not see that extra fiscal stimulus, though, as more inflationary and helping to spur more demand?”
Adeyemo responded, “Our goal is to make sure that we’re doing what we can to help people deal with high prices throughout the economy. The places we’ve called on states to focus the fiscal stimulus money that we’ve provided them with [are] on two things: One is workforce training and the second one is building additional affordable housing. States are going to have to make decisions based on what their people need. Ultimately, our goal at the federal government is to provide them with the support that we can, both through technical assistance, but also helping them understand what we see going on in the broader macroeconomy. And from my standpoint, the two most important things we can do [are] increase labor force participation and build more affordable housing going forward.”
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