“We think the likely outlook for the next few months is that inflation will rise modestly,” two Biden’s Council of Economic Advisers officials, Jared Bernstein and Ernie Tedeschi, wrote in a blog post on Monday outlining some of the government’s thinking is. “However, we will be keeping a close eye on real price changes and inflation expectations for signs of unexpected price pressures that could arise if America leaves the pandemic behind and begins the next economic expansion.”
Some Republicans call the attitude dangerous. Florida Senator Rick Scott, chairman of his party’s 2022 midterm election campaign, has called on Mr. Biden and mr. Powell done to present plans to fight inflation now.
“The president’s refusal to address this critical issue has a direct negative impact on Florida and families in our country, and it does the most damage to low- and fixed-income Americans,” Scott said in a news release last week. said. ‘It’s time for Biden to wake up from his liberal dream and realize that reckless spending is having consequences, inflation is real and America’s debt crisis is growing. Inflation is rising and Americans now deserve answers from Biden. ”
Economic teams in recent administrations have spent little time worrying about inflation, as inflationary pressures have been tame for decades. It has fallen from the Fed’s average target of 2 percent to 10 percent over the past twelve years, and it was 2.5 percent amid the longest economic expansion in history.
Shortly before the pandemic recession hit the United States in 2020, President Donald J. Trump’s economic team wrote that ‘price inflation remains low and stable’, even with unemployment below 4 percent. While the economy struggled to emerge from the 2008 financial crisis under President Barack Obama, White House assistants feared prices could fall instead of rise.
“Given the economic crisis, we were concerned about preventing deflation rather than inflation,” Austan Goolsbee, chairman of the Economic Advisers’ Council, said during Obama’s first term.
The conversation has changed, given the large sums of money the federal government is channeling into the economy, first under Mr. Trump and now under Mr. Biden. Since the pandemic took hold, Congress has spent more than $ 50 billion, including direct controls on individuals.