Former Treasury Secretary Larry Summers on Monday defended the Biden administration during his feud with Amazon founder Jeff Bezos – who argued with the White House on Twitter that the president’s policies contributed to inflation.
Summers, who has been critical of the administration’s handling of the inflation crisis on several occasions, nevertheless argued that Bezos was wrong to dismiss Biden’s claim that raising corporate taxes would reduce inflation.
“I think @JeffBezos is mostly wrong in his recent attack on the @JoeBiden admin,” Summers tweeted. “It is completely reasonable to believe, as I do and @POTUS claim, that we should increase taxes to reduce demand to control inflation and that growth should be as progressive as possible.”
“I say this even though I have strongly argued that the overly expansionary macro policy of @federalreserve and the government has contributed to inflation,” Summers said. “I dismiss the rhetoric about inflation due to corporate goings as absurd.”
Inflation in April remained near a four-decade high, rising to 8.3% even after the Federal Reserve implemented its plan to cool the economy through raising interest rates.
The alarming figures escalated criticism of Biden from those who argue his huge social spending proposals will make the problem worse.
Bezos, one of the world’s richest men, made a sweeping debut at Biden last Friday, accusing the administration of “misdirecting” the administration after the president’s official account tweeted that “the wealthiest corporations should be given their dues.” Paying the share” will bring down inflation.
The Amazon founder expanded on his criticism by responding to a tweet in which Biden claimed to be underreporting the federal deficit – a claim that garnered significant backlash from fact checkers.
“Indeed, the administration tried to deliver even more stimulus to an already hot, inflationary economy and only Munchkin saved him from himself,” Bezos tweeted. “Inflation is a regressive tax that hurts the least affluent the most. The wrong direction doesn’t help the country.”
“It doesn’t take a huge leap to find out,” the White House said in a statement after Bezos opposed Biden’s plan to raise taxes on corporations and wealthy Americans.
That response sparked yet another scathing rebuke from Bezos, who accused the White House of more misdirection on the subject of inflation.
“Look, a squirrel! This is the White House statement about my recent tweets. They definitely want to spoil the topic,” Bezos said.
They know that inflation hurts the most needy. But unions are not creating inflation and neither are rich people. Remember that the administration did its best to add another $3.5 trillion to federal spending. They failed, but if they succeed, inflation will be even higher than it is today, and inflation is at a 40-year high today,” Bezos said.
Summer, who headed the National Economic Council during the Obama administration, defended the White House last November despite claiming that Biden was “behind the curve” in combating inflation.
Summers has also argued that a Biden-backed plan to reduce inflation by cracking down on antitrust violations could worsen the crisis rather than improve it.