By Trevor Hunnicutt
WASHINGTON — President Joe Biden’s administration increasingly feels it has little control over near-term inflation, officials say, and is looking at ways to offset the political risk of price hikes in the months leading up to the November election.
Last week’s data showed inflation remaining at a 40-year high but slightly below a previous peak.
The economy and Biden’s leadership are big issues for voters, and cutting the cost of meat, gas and other staples is a key way Democrats can defend control of Congress in November’s midterm elections, strategists say.
But a US president’s ability to cut prices in world markets, from oil to grains, in the short term is limited, White House advisers say.
Impact on supply chain bottlenecks related to China’s COVID-19 lockdowns and Russia’s invasion of Ukraine, which are driving up prices, remain out of reach, they say.
The government expects inflation to slow from its breakneck pace later in the year, advisers said, but not to levels considered acceptable.
In response, the White House, which until recently described rising inflation as temporary, has adopted a three-pronged strategy: Reacting as aggressively as possible to prices it believes could impact margins, the role of Russian President Vladimir Putin and the pandemic underscore and criticize Republicans and suggest their economic policies would be worse.
The change in message comes after some Democrats told the White House it was slow to respond to the policy issue of inflation. Democrats say it’s too early to tell if the new message will impact voters.
“There was overpromising and underdelivering,” said Jason Furman, an economics professor at Harvard University and a former senior adviser to President Barack Obama. “Now the messages are more realistic.”
Political strategists say it’s important for Biden to communicate empathy and action even when good options don’t exist as a divided GOP bands together to attack the president over “Biden inflation.”
Republicans blame Biden’s $1.9 trillion bailout and other measures for fueling inflation, even though prices started to rise even before he took office and the phenomenon was global.
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For its part, the Biden White House has criticized companies for taking home record profits and buying back shares while charging high prices.
It has also sought to increase competition in sectors such as meat, partnered with retailers to take pressure off supply chains at ports and railroads, and released oil from strategic reserves to try to drive down prices.
The White House’s strategy ahead of the Nov. 8 election is to identify and apply as many executive orders as possible to ease the burden on Americans who are struggling with high costs.
Future measures could range from student loan relief to temporary suspensions of holiday gas taxes and health care grants.
Other possible measures, notably lowering import tariffs, would reduce costs somewhat but come with their own political risks and may not materially change the underlying inflation dynamics, officials said.
What’s not on the menu? immigration reform. Biden proposed a sweeping package of reforms in 2021 that would have allowed more workers to fill a national labor shortage that has pushed up wages and prices, but legislation has failed to advance in Congress.
Biden maintained the restrictive immigration policies passed under the previous administration, including COVID-19 restrictions.
The policy changes prevented about 3.4 million more immigrants from entering the United States between 2016 and 2021, according to the Federal Reserve Bank of Kansas City, contributing to a shortage of workers.
Biden will continue to emphasize the Fed’s role in price control, officials said. He will also underscore his support for the central bank’s move to raise interest rates sharply.
In addition, he plans to highlight the inflationary effects of Russia’s blockade of Ukrainian grain exports and what he believes are the necessary costs of isolating Putin with measures like restricting the use of Russian oil, even if prices rise.
Meanwhile, Democrats will continue to tell voters that Republicans have no serious policy plans.
Republicans have not approved detailed recommendations to fight inflation, but support cutting taxes and budget deficits and relaxing regulations for oil and gas producers.