Biden's $2T spending bill praised by Obama economic adviser, but inflation concerns remains

Former Obama economic adviser Larry Summers offered measured praise for President Biden's $2 trillion infrastructure spending bill on Thursday after spending months warning about inflation risks.

"I am excited by @POTUS Joe Biden's #BuildBackBetter investment program announced yesterday," Summers wrote on Twitter. "It represents an overdue recognition that the relative return on public and private investment has changed dramatically over the last generation. That makes borrowing and investing at large scale the right strategy for the Federal government."

However, he still had a warning.

"I continue to be very worried that the current fiscal - monetary mix will overheat the economy. But these measures will not exacerbate the problem," said Summers, who in March called Democrats' $1.9 trillion relief package "the least responsible macroeconomic policy we’ve had in the last 40 years." 

OBAMA'S ECONOMIC ADVISER BLASTS BIDEN'S STIMULUS PLAN, SAYS IT COULD TRIGGER HIGH INFLATION

Biden outlined his proposal for a massive $2 trillion spending bill on Wednesday. The Biden White House said the plan will be paid for by corporate tax hikes. The White House summary of the American Jobs Plan explained it will spend "$115 billion to modernize the bridges, highways, roads, and main streets that are in most critical need of repair" out of the total $2.2 trillion in the plan.

Summers said he is worried the plan may not be designed well enough to prevent corporate giveaways. He also said he's afraid it's not bold enough.

"If we could afford $2.8 Trillion in Covid relief this year with a booming economy, why can’t we afford more than $1.5 trillion in infrastructure in this decade?" Summers wrote on Twitter.

Summers has been critical of economic responses to the coronavirus pandemic, including stimulus checks, since last year. Summers argued for narrowly targeted relief in a Bloomberg op-ed in December.

"The question in assessing universal tax rebates is, what about the vast majority of families who are still working, and whose incomes have not declined or whose pension or Social Security benefits have not been affected by Covid-19? For this group, the pandemic has reduced the ability to spend more than the ability to earn," he wrote.

Meanwhile, Republicans are heavily criticizing Biden's newest spending plan.

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The opposition is coming even from moderates who attempted to work with Biden on the coronavirus stimulus bill. This makes it even more likely that Democrats will be forced to invoke budget reconciliation yet again if they want to pass what Biden called "the largest American jobs investment since World War II."

"I support improving America’s aging roads, bridges, ports, and other infrastructure. And we can do so in a bipartisan way," Sen. Rob Portman, R-Ohio, said Wednesday. But, he said, Biden's plan is far too expensive and does not focus on infrastructure.

Fox News' Tyler Olson contributed to this report.