Former White House chief strategist Steve Bannon appeared on Fox News’ “Sunday Morning Futures” to address the economic impact of the Chinese virus COVID-19.
With the prescribed cure for the pandemic beginning to appear more deadly than the disease itself, Bannon called for a “full shutdown” of the economy, even though it will “blow up the balance sheet.”
Characterizing Trump as a “wartime president,” Bannon spoke of Trump’s “first bold move,” which was to shut down traffic from China in January and quarantine people reentering the United States if they had the virus.
Pointing to some of the problems encountered, he said Trump “has turned American industry into an arsenal for democracy or an arsenal for health care, to start building more ventilators and getting more masks.”
“If you look at the situation we are in, you have to put in three buckets,” Bannon said. “The pandemic, the economic crisis caused by the pandemic, both the short-term and the deeper things on the supply chain, and then the financial crisis that is now on top of every financial market across every asset class in the world.”
He then spoke of a “much tougher solution,” saying, “I don’t think we have months to do this.”
“I think what should happen, and my recommendation would be to drop the hammer, don’t mitigate the virus, do not spread the curve, shatter the curve,” Bannon stated. “And go full hammer on the virus right now with a full shutdown, use the stimulus to bridge the economic crisis — it may take 2 trillion, it may take 3 trillion to force cash into the little entrepreneur and the little guy.”
“Whether it takes two weeks or four weeks, we get through this hard and fast,” he added.
Bannon encouraged an idea floated by several people to address the capital market side of the problem, which is to merge the balance sheet of the Federal Reserve and the U.S. Treasury and use that as a lender of last resort to actual corporations.
He said it will “blow up our balance sheet,” but insisted “we have to get through this.”
“One of the things I learned from President Trump — he calls me his best student — is he’s about getting it done yesterday. If you want to get it done yesterday, you drop the hammer today on the virus,” Bannon said.
Host Maria Bartiromo cited a tweet from Sen. Ted Cruz, R-Texas, that speaks against a carve-out for specific corporations — a position that gained the support of Sen. Mike Lee, R-Utah.
“In negotiations for economic crisis relief, some are pushing for a special carve-out just for Boeing & GE. That would be WRONG. Millions are losing jobs; we don’t need bailouts or corporate welfare—those companies should participate in the same liquidity programs as everyone else,” Cruz tweeted.
As I said at the start of this process, the relief package should not include bailouts for specific, government-favored businesses. Americans are in this together. Why would we create a special program for two companies? https://t.co/te8V3SyrxB
— Mike Lee (@SenMikeLee) March 21, 2020
Bartiromo said that once you bail out two giant corporations, everyone is going to get in line.
“You’re talking about shutting down a 22 trillion-dollar economy for a period of time, what will that look like on the other side?” she asked.
“President Trump is a wartime president,” Bannon reiterated. “One of the wartime figures he admires is General [George] Patton. Gen. Patton said a simple plan violently executed today beats a more complicated plan that takes months and months to execute.”
“If you are going to go through hell, let’s go through it as fast as possible,” he added.
“We have an economic inferno coming at us,” Bannon said, noting unemployment is likely to reach 20%. “We are on the brink of having permanent damage to the greatest economy in the world.”
“President Trump’s greatest virtue is an entrepreneurial spirit, his toughness, and his focus,” he said. “And I’m just saying right now, not mitigate it, hammer it and take the pain upfront.”
Bannon would go on to say that this crisis is “much deeper” than the 2008 financial crisis.
“This is war!” he insisted
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