Thursday, October 21, 2021

Biden and the Fed say the economic recovery is on the right track, but critics are skeptical.

McDonald’s, Chipotle and Amazon are all raising salaries as companies try to fill jobs faster than they find workers. Airplane tickets and hotel rooms are becoming more expensive due to the new comprehensive vaccination. Lack of supplies is making it difficult to buy a house or a new car.

Republicans look at the economy and see a political obligation for the Biden administration. Inflation is fading away, they warn, and labor shortages are threatening the viability of long-suffering small businesses.

President Biden and his advisors assess similar situations and come to a very different conclusion. They say the dislocations that cause prices to rise rapidly are likely to be temporary. And while both the pace of the economic snapback and the power given to workers have come as a surprise, White House economic officials have little interest in the evolving trends.

The Federal Reserve similarly views its policies – rock-bottom interest rates and monthly purchases of government-backed debt that are boosting borrowing and spending – as helping to recover the labor market and the overall economy. Its top officials have said that the expected period of high inflation this year will be temporary.

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Critics, including some liberal economists, see the confidence coming from the White House and the Fed and see a risk: policymakers will be too slow to change course in the face of a rapidly changing backdrop. If companies continue to struggle to find workers and prices go up even more, they warn, the economy may heat up, harming businesses and consumers and perhaps even causing another recession .

Republicans are also blaming the White House for not eliminating more liberal unemployment benefits, which they say put workers on edge, citing anecdotes from business leaders around the country. At least 21 Republican-led states have already announced that they will stop offering the $ 300 supplement.

Nation World News Desk
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