Press Releases | Budget, Taxes, and Public Investment

News from EPI News from EPI:  Deficit reduction should take a back seat to job creation

For Immediate Release: Wednesday, June 30, 2010
Contact: Karen Conner or Eve Turow, 202-775-8810

EPI Policy and Research Director John Irons testified before the National Commission on Fiscal Responsibility and Reform this afternoon. In his testimony he warned, “The economy remains fragile and is performing well below its potential. Major deficit reduction should not be on the table until the recovery is firmly on track, that is, until unemployment has dropped significantly and is on a downward trajectory. To be concrete, unemployment should reach 6 percent or lower, and be trending downward, before any fiscal contraction should be seriously considered. In fact, with unemployment hovering near 10 percent and with projections putting unemployment at elevated levels for at least the next couple of years, further job creation is indeed necessary.”

Irons stressed that “Deficit reduction and job creation are not competing priorities. Job creation is needed today to ensure a strong economy and a solid tax base tomorrow: you can’t reach reasonable budget targets without a strong and rapid recovery, and you won’t get a strong recovery if you pursue austerity too early.”  Click here for the full written testimony.