The 58-page “Biden-Harris Economic Blueprint” comes two months after the United States met the rule-of-thumb definition of a recession — two consecutive quarters of negative growth — as the economy shrank at a 1.6% annualized rate in the first quarter and contracted at a 0.6% pace in the second quarter. The document, however, outlines the administration’s legislative victories and claims that they are responsible for a purported economic recovery.
“President Biden’s agenda has contributed to the strongest and most equitable economic and labor market recovery in modern history, and catalyzed a resurgence in public investment that will help ensure a strong, innovative, clean energy future that is made in America,” the report claimed. “Together with generational investments in infrastructure, clean energy, and advanced manufacturing, the Biden economic agenda has coupled historic job creation with a long-term strategy to ensure that good jobs of today and tomorrow are created in America.”
The report describes several tenets of the White House’s economic agenda — including greater unionization, government childcare and health programs, and progressive tax policy — before claiming that such policies are responsible for the labor market and other relative bright spots in the economy. Reports nevertheless indicate that the $1.9 trillion American Rescue Plan worsened labor shortages and contributed to other phenomena behind rising price levels.
The document also pinned inflation and elevated gas prices on the Russian invasion of Ukraine. “President Biden is committed to tackling these immediate challenges, without giving up the substantial economic and labor market gains our economy has achieved,” the report said. “And we are seeing significant progress on that front, with a decline of more than $1.20 in gas prices this summer and overall prices in the economy declining moderately in July.”
The report failed to mention, however, that the national average price of gasoline was $2.38 per gallon when Biden assumed office and increased to $3.53 per gallon by the start of the Russian invasion. Prices surpassed $5.00 per gallon in early June before subsiding to $3.74 per gallon as of Friday, according to data from AAA.
Indeed, top officials in the Biden administration have similarly deflected the notion that Biden is partially responsible for persisting economic bottlenecks. Treasury Secretary Janet Yellen, for example, contended in a Thursday speech that the nation has witnessed “one of the quickest economic recoveries in our modern history” under Biden.
“Our plan has worked,” she commented. “The United States experienced the fastest pace of job creation in our history. Household balance sheets are strong. Businesses continue to invest. Our broad and inclusive recovery has outpaced that of many other large economies. And measured by gross domestic income, our economy continues to expand and is operating above levels that would have been predicted pre-pandemic.”
Meanwhile, the personal saving rate — the share of disposable income Americans devote to savings — was a mere 5% in August, according to data from the Bureau of Economic Analysis, reflecting a level significantly below the 7% or more Americans typically saved through much of the last decade.
“It’s fair to say: by any traditional metric, we have experienced one of the quickest economic recoveries in our modern history,” Yellen added.