The US president’s appeal came during a visit to the industrial city of Cleveland, Ohio, as he prepared to unveil a $ 6 billion annual White House budget on Friday that includes ambitious plans for large-scale government investments.
Biden made the trip to defend the administration’s economic record and refute Republican criticism that rising prices and labor shortages due to strong budget support were overheating the economy and stalling recovery .
“You can’t restart a global economy like flipping a light switch. There will be ups and downs in jobs and economic reports. There will be supply chain issues and price distortion on the way back to stable and steady growth, ”Biden said. “But it’s already clear: we are on the right track.”
The White House sees wage increases as a solution to the current misalignments in the labor market – with some companies struggling to fill vacancies despite millions of people still out of work – as well as a way to help them. low-wage households inflation.
“The rise in wages is not a bug, it is a characteristic. . . Instead of workers competing for scarce jobs, we want employers to compete for workers, ”Biden said.
“Corporate profits are the highest in decades and workers’ wages are the lowest in 70 years. We have more than enough leeway to increase workers’ wages without increasing customer prices, ”he added.
The Biden administration’s confidence in its economic strategy has been called into question in recent weeks by data showing an unexpected spike in consumer prices in April, coupled with unusually slow job growth.
This sparked a wave of criticism from Republicans that overspending was pushing the United States back into the stagflation era of the 1970s. Many businesses – and Republican lawmakers – believe that too generous budget support for households is to blame for preventing workers from re-entering the workforce as inflation threatens to spiral out of control.
Senior administration officials retorted that the price disruptions could be resolved fairly quickly.
“The recent inflation that we have seen will be temporary, it is not something endemic,” Janet Yellen, Secretary of the Treasury, told members of the House of Representatives’ appropriations committee on Thursday. “I expect this will last for several more months and high annual inflation rates will go through [to] the end of this year.
Biden also suggested that the White House would soon take additional steps to try to alleviate some of the supply chain woes that were pushing prices up amid rising demand, “starting with building materials and bottlenecks. ‘transport throttling, building on the work we do on computer chips’.
After this year’s surge in economic activity, the Biden administration continues its plans for additional investments worth $ 4 billion over a decade – both in physical infrastructure and social spending – in addition nearly $ 2 billion in short-term stimulus to fuel the long-term and correct what she sees as major structural flaws in the US economy.
Those plans are expected to be presented in Friday’s budget, along with tax increases on businesses and wealthy Americans proposed to fund the plans.
But Biden’s hope of implementing those plans hangs on delicate negotiations with Republicans and Democrats on Capitol Hill.
Whether Biden’s economic policies are seen as a success or a failure could be crucial for Democratic hopes to maintain or expand their majority in Congress in next year’s midterm elections. In a note Thursday, Mike Donilon, a White House adviser, said based on polls he believed the public supported many of the president’s proposals, even in the face of growing Republican opposition.
“When Republicans criticize the president’s plan to rebuild our economy with long overdue investments in infrastructure in our country, they are criticizing what their own constituents have been calling for decades,” he wrote. “When they attack the president’s plan to get the rich to finally pay their share of taxes, they attack the fundamental sense of fairness of the American people.