Despite the number of events happening across the country, people’s foremost concern has been the heavy inflation with gas and food prices soaring.
Although many have voiced their concern over a potential recession, President Joe Biden and several experts maintain that it is unlikely to happen.
The topic came back up again when Jared Bernstein, a member of the White House Council of Economic Advisers, admitted on Sunday that inflation was “unacceptably high.”
Jared Bernstein’s statements on Fox News Sunday
On Sunday, Jared Bernstein appeared on Fox News Sunday to discuss the state of the economy.
While Bernstein acknowledges high inflation, he also pointed out that President Biden does not believe the country will fall into a recession. Shannon Bream, host of Fox News Sunday, noted that Biden had said that by 2021 no serious economist believed the country would enter a period of runaway inflation. Today, inflation in the US was 5.4% at the time of his comment, up from 9.1% this year.
Bream asked how the White House had misinterpreted the situation, to which Bernstein replied:
“Well, that actually was the dominant forecast at the time, and we were very much doing forecasts across the board, including those at the Federal Reserve.”
He added that unforeseen events fueled inflation, citing the war in Ukraine.
“Ukraine and Russia are both breadbaskets and energy baskets for the world,” he explained. “Those have put considerable upward pressure on prices. For example, for inflation, which is unacceptably high – let’s get that clear right out of the gate. Went up 1.3% in June – again, an unacceptable high increase.”
“Half of that is the increase in energy prices alone,” Bernstein added. “Still too high. But that’s moving in the right direction, giving Americans some much-needed breathing room. They need more, and we’re working on it, but that is a move in the right direction.”
How people have been handling the situation
A poll on Sunday found that 93% of US voters are worried about the level of inflation and more than half fear it will get worse within a year.
According to a Fox News poll, there is a 6% increase from May, with 67% expressing extreme concern, while 25% fear inflation will hit 9.1% in June. 52% of voters who took part in the poll predict the situation could get worse by 2023, with the two halves split between “few” and “many”. Meanwhile, just 42% are optimistic the economy is improving.
Administration spending package
Bernstein also said Democrats agreed to cut prescription drug costs and health insurance premiums under the Affordable Care Act.
Bream added that Sen. Joe Manchin’s opposition to some of the administration’s big spending programs may have benefited the White House on inflation.
“[What] Democrats are actually aligned on is a plan to lower prescription drug costs,” explained Bernstein. “And I think everyone who hears me say that probably gave some kind of an applause – everyone wants to see that happen.”
“But while Presidents have tried to make it happen for decades, it still hasn’t occurred. Now we pay two to three times for prescription drugs, what Europeans pay for precisely the same drugs. So it’s time to stand up to Big Pharma, come together. Do something on the affordability there.”
Biden’s commitment to climate change
Despite Manchin and others’ views on spending, particularly White House climate initiatives, Bernstein said Biden recognizes the priority of taking action on climate change and building clean energy industries — a necessity. for the continued development of good American jobs.
“If there is no legislative path forward, he will take the executive order and rule change path,” Bernstein said of Biden’s approach.
The state of the economy
Jared Bernstein also pointed out that the budget deficit will drop 77% to $ 1.7 trillion by 2022.
GDP showed negative numbers in the first quarter of the year, while other numbers suggest it could see similar numbers in the second quarter. Meanwhile, the White House remains steadfast that the United States is not in a recession.
“It has to do with a number of economic variables that are actually doing better now,” Bernstein explained.
“It is very hard to conclude that we are in a recession when you look at the payroll and the job gains that we’ve seen now, it is tricky to look around the corner here, and I’m not going to predict quarters down the road.”
“But I think right now, you’ve got inflation headwinds big time in this economy – not taking anything from that – but you also have some very strong tailwinds that are boosting consumers.”