White House economic adviser Larry Kudlow on Sunday downplayed the increase in coronavirus cases seen in many states and said the country “has got to open.”
There is growing concern that several states are seeing a rise in cases after they began to reopen.
In an interview on CNN’s ‘State of the Union,’ Kudlow suggested the increase in cases stemmed from more testing and that increased hospitalization numbers were from a return of elective surgery.
“Although the case rate has increased a bit, we’re not talking about a second round here,” Kudlow said.
“Fatality rates continue to be very low, that is probably the ultra-key metric,” he said.
“The country has got to open,” he said. “The costs of not opening may exceed the costs of closing down. I think we’re on the right track here.”
Kudlow painted an upbeat forecast for the economy.
“We are on our way, we are reopening,” Kudlow said. He said the economy was at a “turning point.”
“You’ve got a lot of positive, green-shoot, indicators,” he said.
Kudlow predicted “a big, big” increase in retail sales in May. The government will release the data on Tuesday. Economists surveyed by Econoday expect a rebound of 7.5% after a 16.4% decline in the prior month. In addition, the Apple mobility index, which tracks the movement of consumers, is “practically pre-pandemic,” Kudlow said.
“This economy is now in the recovery stage. That’s the key point I want to make this morning,” he said.
“I think there is a very good chance you are going to get the V-shaped recovery and I think the second half of the year…will be a good 20% economic growth and the unemployment rate will fall,” he added.
The V-shaped recovery refers to a quick snap back in growth.
Fed Chairman Jerome Powell was more cautious, telling reporters this week that there would be a “long road” before the economy is fully recovered.
Kudlow said the White House was against extending the extra $600 a week in unemployment benefits people out of work were able to collect on top of what they got from their state. This benefit expires at the end of July.
And he defended Treasury Secretary Steven Mnuchin’s decision not to release the recipients of the $660 billion in small business loans under the government’s Paycheck Protection Program.