It ‘Absolutely’ Boosted Demand, But It Helped the Labor Market – There Were Supply Problems

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On Friday’s broadcast of MSNBC’s “The Last Word,” White House Council of Economic Advisors member Jared Bernstein responded to a question about whether spending by the Biden administration contributed to inflation, saying there were supply issues and Federal Reserve policy and government spending “absolutely” created more demand, that demand helped create a stronger labor market.

Bernstein said, “Inflation is a global phenomenon, and Joe Biden is not the president of the world. If you ask yourself, what has happened in every country over the years, and of course, the answer is COVID-19. And, as you mentioned, it wreaked havoc on supply chains around the world, especially during a period when we were importing a lot of manufactured goods, which helped contribute to the inflation problem.”

Later, host Ali Welshi asked, “What do you say to people who say you all caused some of this inflationary thing by giving everyone money when they came into office?”

Bernstein responded, “I think when you look at some of the supply concerns that we mentioned earlier, it’s very much related to inflation. Look, I think fiscal policy and monetary policy, the Federal Reserve’s fiscal officer What they were doing was trying very hard to fight the deepest recession we’ve seen since the Great Depression. And it was a real breakthrough under the US rescue plan. We didn’t get a chance to talk about that today, but Today we found out that there are now 22 states where the unemployment rate is less than 3%. This is a record when those data start in the mid 70s. It’s directly related to arms and checks in pockets that This president did when we came here. So, did we help create more demand? Absolutely. Did that demand help build the strongest labor market we’ve had in generations? There’s no question. ”

Follow Ian Hanchett on Twitter @IanHanchett

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