US President Joe Biden speaks on the bipartisan infrastructure agreement at the Port of Baltimore, Baltimore, Maryland on Wednesday, November 10, 2021.
Samuel Kunlun | Bloomberg | Getty Images
As government economists struggled to find ways to combat soaring inflation and ease supply chain disruptions, President Joe Biden relied on his ability to sympathize with the economic concerns of ordinary Americans.
“Have you ever thought you would spend so much money on a gallon of gasoline?” Biden asked the crowd during a speech in Baltimore on Wednesday. “In some areas of California, they pay $4.50 per gallon,” he said in disbelief.
Biden’s official speech was about how the Port of Baltimore will benefit from the infrastructure bill that Biden plans to sign into law on Monday. However, from the beginning, it was clear that the content of the speech was much more than cargo ships.
Biden said at the beginning of his speech: “Today, I am here to talk about one of the most foresighted economic concerns of the American people…that is the price drop, first.” “Second, ensure that our stores have sufficient inventory. Third, Let many people return to work, while tracking and solving the above two challenges.”
Inflation and supply chain issues have been plagued the US economy for several months, but the new developments this week have brought a new sense of urgency to Biden’s remarks.
The latest inflation data released on Wednesday morning showed that prices last month rose at the fastest rate in more than 30 years, up 6.2% from October 2020. The news made Wall Street shudder.
As consumers started shopping for the holidays, new data on billions of goods “out of stock” online were released on Tuesday, followed by an inflation report.
Biden said in Baltimore: “Too many people are upset about the economy, and we all know why.” “They see higher prices. They go to the store or go online, they can’t find what they’ve always wanted, and they can’t find it. When they want. We are tracking these issues and trying to figure out how to solve them head-on.”
For consumers, this “one or two punch” is more complicated. Other economic indicators show that the country is in a stronger-than-expected recovery.
Employment growth in October exceeded expectations by about 80,000, and the unemployment rate fell to 4.6%, the low during the pandemic. Wages are up 4.9% from a year ago.
But even though the economic recovery looks strong, Biden warned on Wednesday that for the average American, the recovery does not appear to be that strong.
“Everything from a gallon of gasoline to a loaf of bread is more expensive, and even rising wages are worrisome,” he said. “We still face challenges, and we have to deal with them,” he said.
In reality, however, economists say that neither Biden nor any president can do anything to stop inflation. The root causes of current price increases are pent-up demand after the pandemic and global manufacturing issues.
Nonetheless, Republicans are still eager to link the current pandemic-related inflation and supply chain dilemmas with Biden’s broader economic agenda—especially his two major bills on infrastructure and social spending.
“Our early attention to runaway inflation and the growing supply chain crisis is hitting voters,” Republican Representative Jim Banks of Indiana wrote in a recent memo to fellow Republicans. “We need to keep working hard,” said Banks, the chairman of the influential Republican Research Committee.
With few specific options for addressing inflation, the White House focused most of its energy on resolving major port delays and other tangible supply chain issues.
On Tuesday, the government took a series of measures to solve the cargo backlog in major ports, including the construction of US$4 billion worth of coastal ports and inland waterways. This work plan, led by the US Army Corps of Engineers, will begin within 60 days.
Increasing the supply of goods on American shelves is also expected to ease some price pressures.
In the long run, Biden believes that his “rebuild better” agenda will reduce inflationary pressures by increasing labor force participation and overall productivity. But these long-term effects will take years to affect the economy.
However, for now, the future impact of the Biden agenda does not seem to matter to voters who are struggling to cope with soaring food and fuel prices.
In the NBC News poll at the end of October, only 42% of Americans recognized Biden’s work performance. The same poll showed that 71% of voters believe that the country is heading in the wrong direction.
However, Biden insisted on Wednesday that the short-term impact of his government policy will pay off soon.
“Because of these measures we are taking, soon we will see the supply chain start to catch up with demand,” he said. “So, not only will we see more record job growth, we will also see lower prices and faster deliveries.”
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