Biden lays out plan to fight inflation
President Biden laid out a three-part plan on Tuesday for combating high inflation, which has been a major strain on his job approval rating.
“We now have a chance to build on a historic recovery with an economy that works for working families. The most important thing we can do now to transition from rapid recovery to stable, steady growth is to bring inflation down. That is why I have made tackling inflation my top economic priority,” he said in a Wall Street Journal op-ed ahead of a meeting with Federal Reserve Chair Jerome Powell later Tuesday.
The first part of his plan was an acknowledgment that the Federal Reserve “has a primary responsibility to control inflation.” Biden, without naming former President Trump directly, said that his predecessor “demeaned the Fed” and argued that he won’t do that.
The second part involved making goods more affordable for families with a focus on high gas prices. His administration has blamed Russia’s invasion into Ukraine for the high price of gas and Biden touted the release from global oil reserves and called on Congress to pass clean energy tax credits.
Biden’s plan to make goods more affordable also includes fixing supply chains, improving infrastructure, “and cracking down on the exorbitant fees that foreign ocean freight companies charge to move products.” He also touted policies to make housing more affordable and called on Congress to work on reducing the price of prescription drugs and lowering the cost of child and elder care.
Biden’s meeting with Powell on Tuesday indicates he has directed his attention to high inflation, including the high cost of gas and other goods, which has plagued the president’s approval rating and is a challenge for Democrats going into the upcoming midterm elections. The meeting is the first between Biden and Powell since November.
The third part of the president’s plan involved reducing the federal deficit through “common-sense reforms to the tax code.”
“We should level the international taxation playing field so companies no longer have an incentive to shift jobs and profits overseas. And we should end the outrageous unfairness in the tax code that allows a billionaire to pay lower rates than a teacher or firefighter,” he said.
Biden also noted that the Congressional Budget Office projected that the deficit will fall by $1.7 trillion this year, which would be the largest reduction in history.
“With the right policies, the U.S. can transition from recovery to stable, steady growth and bring down inflation without giving up all these historic gains,” he said.
The president said he welcomes debate on his three-part plan and took a stab at Sen. Rick Scott’s (R-Fla.) tax plan, which the White House has tied congressional Republicans to although other lawmakers have either distanced themselves from or declined to embrace it.
“The economic policy choices we make today will determine whether a sustained recovery that benefits all Americans is possible. I will work with anyone—Democrat, Republican, or independent—willing to have an open and honest discussion that delivers real solutions for the American people,” he said.
Biden also said that “growth will look different” during the transition to bring down inflation, noting that there will be lower job creation numbers. Additionally, the president touted elements of the economy that have recovered since the COVID-19 pandemic, including a decline in unemployment and American families increasing their savings and decreasing their debt.
“The U.S. is in a better economic position than almost any other country,” he said.