This week’s inflation report demonstrates that what President Biden is now calling “Bidenomics” (and why shouldn’t he?) is working for the economy, including for its working class. Next to the extraordinary excesses to which the GOP is now reverting, including its astonishing assault on women, this is the most important news that should be the nation’s focus now.
Jaime Harrison, chair of the Democratic National Committee, issued a statement hailing the good inflation news, saying, “Today’s report is yet another reminder that Bidenomics is working. For the 12th straight month, annual inflation has fallen and is now down three percent – the lowest it has been in over two years. Under President Biden and Vice President Harris, unemployment remains near historic lows, wages are up, and we’ve had the strongest pandemic recovery of any leading economy. This progress isn’t a coincidence, it is a direct result of President Biden’s agenda of growing the economy from the bottom up and the middle out – not the top down.”
Meanwhile, in Manhattan, yet another pro-Biden talented woman, Lael Brainard, chair of the National Economic Council, spoke to the Economic Club of New York, saying that “recent data suggest the current outlook for the U.S. economy is upbeat.”
“From the data alone, it would be hard to find clues that the U.S. economy was in the midst of a protracted global pandemic just two years ago and a war-driven shock to energy and food prices just one year ago,” she said.
Brainard elaborated thusly: “Despite repeated forecasts that recession is just around the corner, the U.S. recovery is solid, and inflation is down. Unemployment has fluctuated in a narrow band below four percent for 17 months in a row—the longest stretch in 50 years. Labor market outcomes have been unusually good for the groups of Americans that faced challenges in past recoveries. The share of working age Americans who are employed has risen to highs not seen in twenty years—up from lows not seen in 45 years. Real wages are now higher than they were before the pandemic, and this is particularly true for production and nonsupervisory workers who make up roughly 80 percent of the workforce.
“In an important development, the labor market is now in much better balance than it was even six months ago. American workers have defied predictions that many would not return to the labor force following the pandemic. Recent months have seen labor force participation by prime age workers rise above pre-pandemic levels, and the participation rate for the overall workforce is now above its pre-pandemic trend. This has occurred as vacancies and payrolls have moderated.
“The economy is defying predictions that inflation would not fall absent significant job destruction. Just today, we saw new and encouraging evidence that the U.S. economy is on the path to moderate inflation accompanied by a resilient jobs market. Annual CPI inflation is 3.0 percent—close to the 2.9 percent average level that prevailed in the nearly two decades leading up to the financial crisis. Annual inflation has now declined every month for 12 months in a row. And inflation in the United States is now the lowest among G-7 nations – for both headline and core inflation – even as our economic recovery from the pandemic has been the strongest.
“While declines in energy and food prices have been important in bringing overall inflation back down, core inflation is also declining. Annual core CPI inflation has now fallen and is projected to decline further as rents decelerate. The closely watched category of core non-housing services CPI has run at an annualized rate of 3.3 percent over the last six months, close to the 3.2 percent average from the three decades before the pandemic and excluding the financial crisis. It will be important for corporations to continue to bring their markups back down after having raised them to unusually elevated levels over the past two years, which would help in reducing inflation. The markups associated with price-price spirals– with final goods prices going up by more than input prices – should unwind if customers become more pric
This week’s inflation report demonstrates that what President Biden is now calling “Bidenomics” (and why shouldn’t he?) is working for the economy, including for its working class. Next to the extraordinary excesses to which the GOP is now reverting, including its astonishing assault on women, this is the most important news that should be the nation’s focus now.
Jaime Harrison, chair of the Democratic National Committee, issued a statement hailing the good inflation news, saying, “Today’s report is yet another reminder that Bidenomics is working. For the 12th straight month, annual inflation has fallen and is now down three percent – the lowest it has been in over two years. Under President Biden and Vice President Harris, unemployment remains near historic lows, wages are up, and we’ve had the strongest pandemic recovery of any leading economy. This progress isn’t a coincidence, it is a direct result of President Biden’s agenda of growing the economy from the bottom up and the middle out – not the top down.”
Meanwhile, in Manhattan, yet another pro-Biden talented woman, Lael Brainard, chair of the National Economic Council, spoke to the Economic Club of New York, saying that “recent data suggest the current outlook for the U.S. economy is upbeat.”
“From the data alone, it would be hard to find clues that the U.S. economy was in the midst of a protracted global pandemic just two years ago and a war-driven shock to energy and food prices just one year ago,” she said.
Brainard elaborated thusly: “Despite repeated forecasts that recession is just around the corner, the U.S. recovery is solid, and inflation is down. Unemployment has fluctuated in a narrow band below four percent for 17 months in a row—the longest stretch in 50 years. Labor market outcomes have been unusually good for the groups of Americans that faced challenges in past recoveries. The share of working age Americans who are employed has risen to highs not seen in twenty years—up from lows not seen in 45 years. Real wages are now higher than they were before the pandemic, and this is particularly true for production and nonsupervisory workers who make up roughly 80 percent of the workforce.
“In an important development, the labor market is now in much better balance than it was even six months ago. American workers have defied predictions that many would not return to the labor force following the pandemic. Recent months have seen labor force participation by prime age workers rise above pre-pandemic levels, and the participation rate for the overall workforce is now above its pre-pandemic trend. This has occurred as vacancies and payrolls have moderated.
“The economy is defying predictions that inflation would not fall absent significant job destruction. Just today, we saw new and encouraging evidence that the U.S. economy is on the path to moderate inflation accompanied by a resilient jobs market. Annual CPI inflation is 3.0 percent—close to the 2.9 percent average level that prevailed in the nearly two decades leading up to the financial crisis. Annual inflation has now declined every month for 12 months in a row. And inflation in the United States is now the lowest among G-7 nations – for both headline and core inflation – even as our economic recovery from the pandemic has been the strongest.
“While declines in energy and food prices have been important in bringing overall inflation back down, core inflation is also declining. Annual core CPI inflation has now fallen and is projected to decline further as rents decelerate. The closely watched category of core non-housing services CPI has run at an annualized rate of 3.3 percent over the last six months, close to the 3.2 percent average from the three decades before the pandemic and excluding the financial crisis. It will be important for corporations to continue to bring their markups back down after having raised them to unusually elevated levels over the past two years, which would help in reducing inflation. The markups associated with price-price spirals– with final goods prices going up by more than input prices – should unwind if customers become more price-sensitive and firms compete more intensely for customers.”
