Biden vows to fight inflation as prices continue to climb | National Policy
By CHRIS MEGERIAN and JOSH BOAK – Associated Press
LOS ANGELES (AP) — According to President Joe Biden’s estimate, the United States is in a strong position to ride out the worst inflation in more than 40 years. But so far, inflation keeps getting the better of the US economy and the Biden administration.
The president’s policies, deals with the private sector, regulatory actions and public majesty have so far failed to keep prices from rising.
Biden pledged on Friday to continue to fight inflation during his visit to the Port of Los Angeles, the busiest port in the United States and a place that the White House said last October would be essential for reduce price pressures.
“My administration will continue to do everything in its power to bring down prices for the American people,” the president said after a decidedly grim new report on consumer prices.
The Labor Department reported Friday that consumer prices rose 8.6% in May from a year ago. It’s the worst reading since December 1981 and a worrying sign for the economy as rate hikes by the Federal Reserve have yet to stave off inflation as gasoline prices rise higher . Rising prices jeopardize the US economy as well as Democratic control of the House and Senate, putting Biden on the defensive.
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AAA separately reported that average gas prices in the United States hit a record high of $4.99 a gallon, an increase that exceeded the president’s previous efforts to reduce headline inflation. The pain at the pump is hurting Biden’s public approval ahead of the midterm elections.
On Friday, the president also blamed corporate profits for inflation, saying some companies – including shipping companies and the oil industry – are focused on maximizing profits. Biden specifically targeted ExxonMobil for not doing more to increase oil production.
“Exxon has made more money than God this year,” he said.
ExxonMobil responded to Biden’s comment by saying it was producing more oil.
“We have been in regular contact with the administration, advising them of our planned investments to increase production and expand refining capacity in the United States,” Casey Norton, a company spokesman, said in an email. mail. “We have increased production in the Permian Basin by 70%, or 190,000 barrels per day, between 2019 and 2021. We expect to increase production from the Permian by another 25% this year.
The Port of Los Angeles moved to 24-hour operations last October under an agreement the White House helped manage. The aim was to clear the backlog of ships waiting to dock and containers waiting to enter the country, a blockage that was driving up prices as the world began to recover from the coronavirus pandemic.
The port is currently taking out a record 200,000 containers on a 30-day moving average. But the drivers of inflation have largely shifted to rising energy and food costs following The Russian invasion of Ukraine. There has also been a broader price increase that goes beyond supply chain issues. Spending on housing, airfare and medical services increased significantly in May.
Gene Seroka, executive director of the Port of Los Angeles, said many levers are driving improved performance in terms of getting goods to consumers and businesses faster. But he specifically credited the “federal government’s convening powers to bring people to the table” and the Biden administration’s focus on the supply chain.
“We have reduced the number of ships waiting to enter port by 75% this year,” Seroka said. “These guys are really working because we still have strong consumer demand.”
The Biden administration is seeking to cut shipping prices further with a bipartisan bill the House could pass as soon as next week. The bill would give the Federal Maritime Commission tools to make maritime trade more efficient and price-competitive, thereby improving the flow of exports and imports.
“What I’ve found here in California is that they want us to do everything we can to fix the inflation problem – and that’s clearly a big part of the problem,” said the Representative John Garamendi, D-California, a sponsor of the bill.
Rep. Dusty Johnson, RS.D., said he saw the need for the extra tools in part after a cheese processor in his state had two million pounds of lactose rot because no carrier would take the product even if 60% of the shipping containers were returned to Asia empty.
“It’s not a magic bullet when it comes to inflation,” said Johnson, who sponsored the bill. But he noted that as the provisions are implemented, “it will absolutely have an impact on inflation.”
Strong consumer demand has been a mixed blessing for Biden. It reflects the robust employment growth and the strength of household balance sheets that followed the $1.9 trillion coronavirus relief package passed last year. But demand has consistently exceeded supply, pushing prices to levels that are forcing the Federal Reserve to try to slow growth and risk a recession.
The White House argues that the United States can fight inflation without stumbling into a downturn because the economy is so strong with its 3.6% unemployment rate that it can weather a downturn.
Biden is also trying to portray inflation as a global challenge, triggered first by the pandemic and then by Russia’s invasion of Ukraine. The president is trying to refute criticism from Republican lawmakers that inflation is the result of overly generous government aid and its overly onerous restrictions on U.S. oil production.
Biden has tried to slow inflation by improving port operations and twice releasing oil from the U.S. strategic reserve, in addition to other regulatory initiatives and a national program that includes reducing the budget deficit and would require the Congressional approval.
Port visit comes as Biden hosted the Summit of the Americas in Los Angeles. On Friday, he will also announce a statement on migration and host a working lunch with heads of government and state attending the conference of nations in the Western Hemisphere.
And mindful of the campaign season, Biden will attend two fundraising receptions for the Democratic National Committee on Friday.
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