Today, Treasury Secretary Janet Yellen appears on the op-ed page of the Wall Street Journal to declare, “Biden Has the Economy Back on Track.” The word “inflation” appears three times in the 844-word op-ed. Yellen writes:
The Biden administration’s top economic priority is to tackle inflation. The Federal Reserve has the primary responsibility, but we are taking complementary actions to expand supply and provide cost relief. While the future path of the economy remains uncertain, there are signs that the supply-demand imbalances that have been boosting inflation are now easing in many sectors of the economy.
Eh, easing from the worst in 40 years, yes, to a level that is slightly lower than the worst in 40 years. An inflation rate of 7.1 percent looks good compared to June’s figure of 9.1 percent, but it looks lousy compared to any rate from December 2011 to April 2021, when it was under 3 percent.
Yellin later adds, “thanks to the Inflation Reduction Act, millions of Americans will save on their energy, health-insurance and prescription-drug costs.”
If you look anywhere else in the financial pages, you’ll see the lingering impact of this past year and a half or so of high inflation. Salaries aren’t keeping up with inflation. Holiday retail sales are down. Federal Reserve chairman Jay Powell is warning interest rates are likely to go even higher in 2023, and warns we have a long way to go. And Powell isn’t exactly brimming with confidence over the near future: “I don’t think anyone knows whether we’re going to have a recession or not and if we do, whether it’s going to be a deep one or not.”
Treasury secretaries are always going to be cheerleaders for the president they serve, but the Biden administration’s bad habit of celebrating amidst bad economic news continues. Biden and his team latch onto any bit of good news and tout it as a miraculous game-changer. I wonder how many Americans hear this self-congratulatory rhetoric on the radio while driving to the grocery store, where they’ll pay more than ever before.