President Joe Biden said Friday that much of what the Democrats have done in regard to the economy will kick in with a lag, reinforcing GOP claims that inflation will get worse as some of the inflationary impacts of the administration’s big spending bills have not yet fully filtered into the economy.
Biden made the remarks in a sit-down interview with MSNBC’s Jonathan Capehart in at Delaware State University after being asked to comment on polls showing Americans trusting Republicans over Democrats on economic matters.
“A lot of what we’ve done and we’ve passed has not kicked in yet. For example, we have all this money to rebuild the highways, bridges, Internet, etc., but it’s going to take time,” Biden said. “It’s not all happening overnight.”
A recent CNBC poll gave Republicans double-digit leads over Democrats on key economic issues as the midterm elections loom. The biggest difference was on inflation, with 42 percent saying the GOP would do a better job of bringing down inflation, compared to 27 percent indicating Democrats, a 15-point difference.
Republicans have said that the Democrats’ big spending packages would fuel inflation, with some of the effects still to be felt.
‘Only a Fraction Has Actually Been Spent’
New Hampshire Gov. Chris Sununu recently warned that inflation is going to stay high for years due to lagged impact of government spending.
“Everyone talks about the $5 trillion into the economy that has driven inflation, that’s absolutely true, there’s no doubt,” Sununu said.
“What a lot of people don’t realize, I think governors and a few of us who are actually in charge of allocating those dollars and spending them, only a fraction has actually been spent. It’s all been allocated. But the actual number of checks that have been cut is very minimal,” the governor continued.
“ARPA [American Rescue Plan Act] funds—all of this—that’s all designed—infrastructure, all designed to be spent into 2024, 2025, and 2026. And so, inflation is going to be very exacerbated for the next few years, and the recession is going to be very real,” he added.
After government data showed inflation in September came in at 8.2 percent in annual terms, Rep. Jason Smith (R-Mo.), the top Republican on the House Budget Committee, pointed to the American Rescue Plan as one of the reasons Americans “are feeling the sticker shock of rising prices every time they visit the grocery store or the gas station.”
Smith said that under Biden, spending has increased by around $10 trillion.
“Americans are fed up with paying the price for one-party Democrat rule in Washington. In two years, Democrats have added $10 trillion in new spending and left taxpayers holding the bag,” he said in a statement.
Smith’s breakdown for the spending tally includes over $1 trillion on Biden’s executive actions and $745 billion on the so-called Inflation Reduction Act.
It’s not just Republicans that have said that the Biden administration’s and congressional Democrats’ policies have fueled inflation. House Speaker Nancy Pelosi (D-Calif.) said recently that part of what’s behind the sky-high inflation gripping American households is due to Biden’s policies on job creation.
Pelosi said during an Oct. 18 broadcast of MSNBC’s “Andrea Mitchell Reports” that “some” of the inflation in the United States came from “the fact that this president created” millions of jobs.
“Of course, we want to fight inflation. It’s a global issue,” Pelosi said responding to a question about the cost-of-living crunch squeezing American households.
“But some of the inflation in our country sprang from the fact that this president created nearly 10 million—at least 9 million jobs working with the private sector,” she added.
A poll from The Economist/YouGov taken between Oct. 16–18 (pdf) found that 53 percent of Americans disapprove of the job Biden is doing on the economy, while 38 percent approve.
The poll also found that 66 percent of Americans think that, over the next six months, inflation will stay stuck at the current elevated level of 8.2 percent or get even worse.
Half of the respondents said they’ve felt the impact of high inflation on their lives “a lot.”