Many Within Biden's Own Administration Are 'Frustrated' by His Attempts to Tackle Inflation, Fear He Could Make Things Worse: Report
Progressives in the Democratic Party and the Biden administration are wary of President Joe Biden’s attempts to focus and reign in on the record-high inflation plaguing his administration.
The progressives fear that this focus on fighting inflation would undermine their political agenda for the country, Politico reported Thursday citing sources.
They are concerned that Biden’s backing of the Federal Reserve’s recent attempts to combat inflation, could hurt the labor market, and harm government spending plans on areas such as child-care and prescription drugs, according to the outlet.
In recent months, rising consumer and gas prices have hurt Biden’s approval ratings with the nation’s financial troubles becoming a top concern for voters.
According to a Monmouth University poll released Tuesday, Biden’s approval stood at 36 percent with an overwhelming majority of Americans disapproving of the job he is doing as the nation’s commander-in-chief.
“Nearly half of the public names either inflation (33 percent) or gas prices (15 percent) as the biggest concern facing their family right now. The economy in general (9 percent) and paying everyday bills (6 percent) are among other financial concerns mentioned,” the university said in its news release.
A June 5 ABC/Ipsos poll found that a majority of Americans saw the economy, gas prices and inflation as major issues affecting how they would vote in the November midterm elections.
Inflation and the economy had the largest share of respondents describing them as the single most important issue affecting their vote in the midterms, the poll showed.
Biden in late May said when meeting with Federal Reserve Chair Jerome Powell that he had a “laser focus on addressing inflation” just like the central banking system, Barron reported.
The Federal Reserve would go on to announce its largest interest rate increase in 28 years on June 15, with Powell announcing that the central banking system would lift the target range for the federal funds rate to between 1.5 percent and 1.75 percent, in a move expected to trigger unemployment.
Because Biden was willing to back moves to clamp down on inflation even if it hurt the labor market upset many progressives in the Democratic Party, Politico reported.
“A lot of people were frustrated by [the rollout] and by the idea that we were going to try to Paul Volcker our way out of this problem,” one senior official told Politico, making a reference to the 12th chair of the Federal Reserve, who helped reign in on high inflation during the 1970s and early 1980s at the cost of contributing to two recessions.
Despite inflation being a major concern for voters and moderate Democrats calling for fighting inflation as quickly as possible to boost the likelihood of Democrat political successes, a lot of progressives hold the view that “inflation is likely to ease on its own without severe rate hikes,” the Politico report said.
They, according to the outlet, view Biden’s narrowing down on fighting inflation as backtracking on the liberal plan of expanding the government’s role in decreasing income inequality, ensuring women and racial minorities have greater access and progress in labor markets, and transitioning national infrastructure towards clean-energy reliance.
Bharat Ramamurti, National Economic Council Deputy Director and former aide to Democratic Sen. Elizabeth Warren of Massachusetts, was one official notable for suggesting that in order to secure gains for Democrats in wages and the job market, the economy must be allowed to continue its course for a while.
“Bharat likes the alternate macroeconomic theory that says you can let the economy run hot,” a Democratic insider told Politico. “He gets quite irritated that the theory is not being tried out.”
The fight over inflation is but part of ongoing internal policy debates between the Democratic Party’s traditional and progressive wings. Another area where the two factions have been at odds with each other is ending tariffs against China.
While progressives support lifting some of the tariffs, the party’s moderate wing opposes lifting tariffs due to fear of Big Labor’s affinity for tariffs, Politico reported. Big Labor sees tariffs as protecting local workers.
“It’s a policy that would get you very little and make a lot of people very mad,” a Biden administration official said.
The internal debates in the Democratic Party are “mostly respectful but may not stay that way.”
“It’s not like people are storming out of meetings or Zoom calls or yelling at each other all the time,” one senior Biden administration said. “But sometimes there is just not a good answer or one that will satisfy everyone. And obviously, that can be frustrating.”
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