Rensi made the comment as a group of House Republicans is urging the Biden administration to end the federal unemployment benefits program that provided out-of-work Americans an extra $ 300 a week, warning the enhanced aid is hampering the U.S. economic recovery from the pandemic.
The letter comes on the heels of the May jobs report, which revealed that employers added 559,000 jobs last month, missing expectations. It marked the second consecutive miss for job creation: In April, the economy added a revised 278,000 jobs, much smaller than the 1 million forecast by Refinitiv economists.
“The reality of it is is that when you incentivize people with money to do certain behaviors, they’re going to behave that way,” Rensi said.
“When you incentivize people to do negative things, that’s what they’re going to do,” Rensi went on to say. “They’re not stupid.”
At least 25 GOP-led states, including Florida, Arizona and Texas, have recently announced plans to cut off the additional jobless aid, a move leaders there say will help businesses struggling to hire employees.
Roughly 4 million people will lose their jobless aid as a result of the new policies, according to one estimate from the left-leaning Century Foundation.
President Joe Biden and many Democrats have rejected the notion that unemployed Americans are choosing to stay home and collect the extra unemployment benefits – part of the $ 1.9 trillion coronavirus relief law passed in March – rather than returning to work.
Still, the Biden administration has indicated additional unemployment benefits will end in September as planned, despite some Democrats advocating for the additional taxpayer assistance to be made permanent.
Rensi also warned about inflation, noting that, “We’re headed for trouble.”
“I’ll tell you the thing that’s really got me afraid right now: We’re printing money faster than we can use it. It’s inflationary. Costs are going up,” Rensi said.
“I don’t know what is in the minds of these politicians other than the fact they absolutely have no idea of economics.”
Rensi noted that the mindset of politicians has been “if it sounds good on television and in the newspapers do it, whether it’s good, bad, or indifferent for the economy.”
Rensi made the comments as U.S. consumer prices increased in May at the fastest annual rate in nearly 13 years.
The Labor Department said Thursday that the consumer price index in May rose 5% year over year, hotter than the 4.7% increase that was anticipated. The reading was above last month’s 4.2% print.
Prices jumped 0.6% month over month, quicker than the 0.4% increase that was expected by analysts surveyed by Refinitiv, with food prices rising 0.4% matching April’s increase.
The annual data has a “base effects” skew due to the decline in prices that occurred at the start of the pandemic.
Fox Business’ Megan Henney and Jonathan Garber contributed to this report.