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Where a potential Biden administration's stimulus money would go

The Biden administration's top priority, after virus control, will be "building a fiscal bridge to the other side of the crisis." That's what Jared Bernstein, a senior Biden economic adviser, told an IIF conference this week.

Why it matters: Biden has a very large and complex Building Back Better agenda, which includes some 800 different policy proposals and will cost some $3 trillion. But before even getting started on that, the Biden team plans to spend a lot of money — probably north of $1 trillion — on a short-term stimulus package.


Between the lines: In the fight over a potential stimulus package, the Trump administration is refusing to funnel money to state and local government. By contrast, says Bernstein, that will be top of the list for a Biden economic stimulus, because it comes with a high "fiscal multiplier."

  • The Biden team is looking at "getting the biggest bang for the buck," says Bernstein. Giving money to state and local governments has a multiplier of about 1.5, according to the San Francisco Fed. In other words, every $1 given to those governments increases GDP by about $1.50.

Other priorities with high multipliers include nutritional support and expanded unemployment benefits.

The bottom line, per Bernstein: The "fiscal bridge" is going to be needed even if a new stimulus package is passed between now and January. So long as the economy is well below potential — which it will be — Biden will want up-front spending in January.

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New coalition forms to fight Republican legislature in Texas

Texas advocacy and political groups will launch a new coalition Monday to fight Republican efforts to change voting laws in their state and support Texans in need after the pandemic and last winter's paralyzing storm, Axios has learned.

Why it matters: While Democratic lawyers are fighting proposed or enacted changes in voting laws in battleground states, a grassroots response will be critical if the party and its backers hope to have any effects on the 2022 midterms and 2024 presidential election.

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