President Joe Biden finds himself on the defensive over the economy, even as he presides over an emergence from the pandemic opening the spigots of job creation and growth.
Yet, when Biden spoke about the economy on Monday, he found himself fending off concerns about inflation and a plummeting stock market that served as a poor backdrop for what were supposed to be celebratory remarks.
“Some folks have raised worries that this could be a sign of persistent inflation,” Biden said at the White House. “But that’s not our view. Our experts believe, and the data shows, that most of the price increases we’ve seen are — were expected and expected to be temporary.”
“There's nobody suggesting there's unchecked inflation on the way — no serious economist,” Biden later said in response to a reporter’s question. “That’s totally different.”
Even the triumphant line that “capitalism is alive and very well” came with a defensive tone.
“Another prediction — that is my favorite one, I must add — is that if I got elected, I’d bring the end to capitalism,” said Biden, who defeated socialist Bernie Sanders in the Democratic primaries to win his party’s presidential nomination last year. “I never understood that one, but we’ve heard — we’ve heard it an awful lot.”
Nevertheless, Biden has no shortage of good news to share with the public.
“We’ve gone from 60,000 jobs per month to 60,000 jobs every three days — more than 600,000 jobs per month since I took office,” he said. “More than 3 million new jobs, all told. That’s the fastest growth, I’m told, at this point in any administration’s history.”
The resumption of normal business operations after over a year of restrictions to mitigate the spread of COVID-19 has led to rapid economic growth.
“Well, in six months into my administration, the U.S. economy has experienced the highest economic growth rate in nearly 40 years,” Biden said.
“We, of course, have seen the movements in the stock market,” White House press secretary Jen Psaki told reporters Monday as the Dow fell 700 points Monday. “We also know that unemployment is down, economic growth is up, job creation is up, wages are up, and we can assure people we are still at war with the virus, even as we've seen progress made over the last several months.”
“Now, I don't look at the stock market as a means by which to judge the economy like … my predecessor did,” Biden said, attributing this to Republican “trickle-down” economic thinking. “He'd be talking to you every day for the last five months about how the stock market is so high, higher than any time in history, still higher than any time in history. So, that's not how I judge whether or not we're having economic growth.”
But the National Bureau of Economic Research announced Monday that the pandemic recession ended in April 2020 — before Biden even formally secured the Democratic nomination.
Republicans have begun to tie Biden’s policies to some of the economic problems: the high federal spending to rising inflation; the additional unemployment benefit to labor shortages as workers are slow to come back to the job; the administration’s failure to hit its own vaccination targets, undermining investor confidence and tanking the stock market.
All that is before Biden and congressional Democrats as they pass any tax increases.
“While reports on inflation are often framed in percentages, how they impact people is what matters most,” House Minority Leader McCarthy wrote in a letter on Monday. “That’s why I recently asked my online followers to share stories about how inflation is affecting their lives. Though sometimes sad to read, each comment was further proof that our communities are hurting and in need of leadership.”
“Inflation just clocked the fastest year-on-year increase since 2008,” said Senate Minority Leader Mitch McConnell on the floor of the chamber on Monday. “Another multi-trillion-dollar reckless taxing and spending spree is the last thing American families need.”
“Biden wants to inflate his way out of inflation with MORE wasteful inflationary spending,” said Tommy Pigott, the Republican National Committee’s rapid response director, in a statement (emphasis in the original). “If that sounds like nonsense, it’s because it is. And the American people aren’t buying it.”
Pigott cited a Tarrance poll conducted for the conservative American Action Network that showed lopsided majorities were worried about inflation and smaller majorities blamed Biden’s policies.
Biden’s job approval rating on the economy stands at 52.8% in the RealClearPolitics polling average. But a July Economist/YouGov poll found that 48% of registered voters approved of his handling of the economy compared to 44% who disapproved.
Democrats will need Biden to maintain strong numbers on this issue as they defend narrow majorities in Congress in next year’s midterm elections.
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