“We also know that as our economy has picked up steam, we’ve seen price increases. Some people have expressed concerns that could be a sign of persistent inflation. But that’s not our point of view, ”Biden said, speaking from the White House. .
The president said his administration was doing everything possible to cope with the price increases and assured Americans that the disruptions were temporary.
“The reality is, you can’t rekindle the global economic light and expect it to happen. As demand returns, there will be challenges in the global supply chain, ”Biden said. He pointed to high car prices and supply chain issues with semiconductors, calling it a “real challenge”.
The President said: “I want to be clear: my administration understands that if we were to experience uncontrolled inflation in the long run, it would pose a real challenge to our economy. So even though we are convinced that this is not what we ‘Seeing today, we will remain vigilant as to any necessary response. “
The comments come at a critical time as Capitol Hill lawmakers continue to work out the details of his two plans – one focused on ‘hard’ infrastructure like roads and bridges and the other on what Biden calls ” human infrastructure ”, which includes the paid family. leave, education and childcare.
The president said the economic recovery of the United States depends on bringing the coronavirus pandemic under control and urged those who have not been vaccinated to get vaccinated.
“Please get vaccinated. Get vaccinated now. It works. It’s certain. It’s free. It is convenient. You know, this virus doesn’t have to hold you back anymore. It no longer has to curb our economy, ”Biden said.
The president said his detractors – namely former President Donald Trump, whose name he did not mention but alluded to in his remarks – predicted that his presidency would “end capitalism,” adding : “I never understood that one. . “
“It turns out that capitalism is alive and well. We’re making serious progress to make sure it works the way it’s supposed to work: for the good of the American people, ”Biden said.
The president also touted his recent executive order to promote competition in the US economy, which he said would also lower prices. The sweeping order he signed earlier this month aims to cut prescription drug prices, ban or limit non-compete agreements that the White House says hamper economic mobility and crack down on Big Tech and Internet service providers, among other provisions.
Biden has used his scheduled economic remarks to tout a recovery that has seen an explosion in growth and more than 3 million new jobs since taking office, as the country continues to recover from an economic shock caused by a pandemic that pushed the US economy to the brink.
The United States is forecast to achieve growth rates that have not been seen in decades – a point the White House attributes to the intertwined $ 1.9 trillion Covid relief law and an effort distribution of vaccines that led to the complete immunizations of more than 160 million Americans.
But Biden also took the opportunity to try to disarm a line of attack that has resonated in recent weeks as inflation hits its highest level in 12 years and the US economy continues to emerge from what was essentially a total freeze as the pandemic swept across the country.
Beyond the benefits the White House sees in the plans themselves from a direct political perspective, Biden argued that his proposals are designed to increase the capacity of the economy and thereby reduce prices over time. time, an opinion that has led to the prospect inside the White House that rising prices should have no effect on changing their legislative course.
It’s, in a sense, an effort to reverse the GOP’s argument against its proposals – and directly counter an issue that Democrats on both sides of Pennsylvania Avenue say could threaten Biden’s legislative goals.
For the president, these remarks come at a critical time for his $ 4 trillion economic program on Capitol Hill. The bipartisan group that helped craft the infrastructure framework worked urgently over the past few days to reach a final deal ahead of a likely procedural Senate vote on July 21.
Senate Majority Leader Chuck Schumer, a Democrat from New York, also set a deadline for his members to come together around a second Democratic-only proposal that forms the backbone of the spending proposal and d most aggressive investment in a generation.
But legislative deadlines are coming as there is evidence of growing concern in the country over inflation and a clear effort by Republicans to use price increases as a weapon to try and derail Biden’s push for his agenda. .
The Congressional Republican National Committee, the campaign arm of the House GOP, has launched efforts to target frontline Democrats on the issue on the political front, as senior Republicans attacked the impending proposal by only Democrats like totally unnecessary for an economy that has already been on the receiving end of trillions in emergency spending over the past 15 months.
“Our colleagues need to take this summer and think very carefully about what they are discussing,” Senate Minority Leader Mitch McConnell, a Republican from Kentucky, said last week. “It would be difficult to imagine a proposal less suited to the conditions of our country at this stage. ”
It comes as economists on both sides have signaled that the data serves as a flashing warning sign on inflation, and as a Marist poll last month for NPR and PBS NewsHour showed that inflation has exceeded wages. and unemployment as the main public concern about the United States. economy.
The White House economics team has been monitoring the numbers closely and officials say they still firmly believe the data is both transient and more a result of the uneven emergence of the economy following a single supply shock – a shock that has created a series of supply chain bottlenecks and supply-demand mismatches that persist.
“The overwhelming consensus is that it’s going to pop up a bit and then come back down,” Biden said last month.
Yet White House officials admit that while they think the increases are a short-term problem, it’s still a problem that will likely be present for months, if not longer. The 5.4% increase in the consumer price index in June – the largest year-over-year increase since 2008 – only underscored this point.
This is one of the main reasons for Biden’s efforts on Monday to detail how White House economics officials believed his program would fit into this data if passed.
The president said the scale of the two proposals – nearly $ 600 billion in new infrastructure spending and an emerging $ 3.5 trillion proposal designed to include significant investments in education, home care and paid time off – would serve to create an environment to keep prices low and stable.
Biden described the investments as longer term and designed to allow a combination of more opportunities for Americans to enter the workforce, which in turn would increase the supply of goods, while also building resilience. supply chains in a concerted effort to reduce production costs and the ability to get goods to market.
This story was updated with additional developments on Monday.