Over the next decade, US President Biden is set to present a $ 6 billion budget proposal, doubling his plans to invest heavily in the economy, with a bet that inflation will ease after this year.
The White House budget is expected to be released on Friday after the US president travels to Ohio on Thursday to defend the administration’s economic record and refute Republican criticism that high prices and labor shortages are already hampering recovery.
“In the conditions of the epidemic retreat, our economy is moving. “500,000 new jobs are being created every month, new unemployment claims are falling by almost half, a record rise ahead of us,” said Mike Donilon, one of Biden’s top aides, in a memo to the Ohio Guide Thursday morning.
The Biden administration’s confidence in its economic strategy has been challenged in recent weeks by data an unexpected wave in April along with consumer prices, coupled with slow job growth due to inconsistency in recovery labor market“This has provoked a barrage of criticism Republicans that overspending brought America back to the height of the stagnation of the 1970s.
But senior administration officials have argued that price and job disruptions were a function of a rapidly reopening economy that would be resolved relatively soon.
“The inflation we have seen recently will be temporary, it is not endemic,” Treasury Secretary Annette Yellen told members of the House Appropriations Committee on Thursday. “I expect that in a few months, I will see high annual inflation rates by the end of this year.”
Following this year’s boom in economic activity, the Biden administration plans to plan additional investments within a decade, both in physical infrastructure and social spending, in addition to a short-term stimulus of less than $ 2t, to correct what it considers to be the US economy. major structural defects.
But those hopes depend on tact negotiations On Capitol Hill with both Republicans and Democrats. At the same time, the White House hopes that higher inflation will help improve wages for many workers as businesses try to attract better-paid workers, especially to low-income households.
Whether Biden’s economic policies are successful or unsuccessful is crucial to their hopes of maintaining or expanding their majority in Congress in next year’s midterm elections. In a memorandum on Thursday, Donilon said that based on a poll, he still believes that the public supports many of the president’s proposals, even as the Republican opposition grows.
“When Republicans criticize the President’s plan to rebuild our economy through long-term investment in our country’s infrastructure, they criticize what their constituents have been claiming for decades,” he wrote. “When they attack the president’s plan for the rich to finally pay their taxes, they are attacking the basic American sense of justice.”