Strong economy, declining gas prices have escaped notice, White House says
After making a fight against inflation its “top priority,” the Biden administration says aspects of the economy are robust, even if headlines haven’t reflected that.
Senior administration officials promoted Biden’s economic record on a call with local reporters Wednesday on positive economic indicators — mainly low unemployment and falling gas prices — ahead of a quarterly GDP report to be released Thursday that could show the country is entering a recession.
The White House has appeared frustrated in recent weeks that the decline in gas prices has not received the same news coverage as the precipitous climb earlier this year.
Nearly half of states have unemployment rates of less than 3%, the economy has added 375,000 jobs per month over the last three months, supply-chain issues are resolving and the nationwide average price of gas is 70 cents below its peak six weeks ago, administration officials said Wednesday.
But that news hasn’t penetrated the way the rise to record-high gas prices — which the administration blamed on the disruption to global markets caused by Russian President Vladimir Putin’s invasion of Ukraine — did earlier this summer, the White House has complained.
“While the rise in gas prices last month due to Putin’s Price Hike was met by wall-to-wall media coverage, the fall in gas prices has not earned the same reception,” White House Communications Director Kate Bedingfield said in a memo this month.
Gas price increases
A variety of factors led to the spike in gas prices, experts say.
Prices have risen consistently during Biden’s presidency, from a national average of $2.42 a gallon in January 2021 when Biden was inaugurated, to $3.41 a gallon a year later, the month before Russia launched its attack, according to the U.S. Energy Information Administration.
An administration official said Wednesday Biden’s decision to release 125 million barrels of oil from the Strategic Petroleum Reserve — a complex of underground storage caverns along the Texas and Louisiana coasts — was partly responsible for falling gas prices.
The average price of gas Wednesday was $4.30 a gallon, according to AAA. The automotive group pegged the highest-ever average at $5.02 on June 14. The White House expects prices to continue to fall to about $4 per gallon, an official said.
The rise in gas prices has led an overall spike in consumer prices, which rose 9.1% in June over 2021 levels.
The economy is in a period of recovery from the pandemic, officials said, and the administration is making efforts to transition from “running at this sprint to recover from the pandemic, get out of that deep hole” to “strong, stable, shared growth that we want to see month-over-month, quarter-over-quarter, year-over-year.”
The officials contrasted Biden’s vision of economic growth with what they said was the pre-pandemic norm of uneven and generally low gains in wages. They said they are also working to lower prices across the economy.
The pandemic’s stay-at-home phase shut down much of the economy and upset normal supply-and-demand dynamics. The supply chain has been slow to recover, leading to product shortages, but has “unsnarled, to some degree,” an official said Wednesday.
“We really do need to keep focused on what is going to benefit American families, maintaining this strong recovery — and at a stable pace that we can handle over time — and getting prices down,” a senior official said. “And we are transitioning to that kind of economy.”
Biden is focused on bills now in Congress that could further reduce costs to consumers, the officials said.
Biden on Wednesday night issued a statement in support of a reconciliation bill also endorsed by West Virginia Democratic Sen. Joe Manchin III and Senate Democratic leadership that would allow Medicare to negotiate with drug companies over the price of some prescriptions, lower health insurance costs and reduce inflation, among other things.
This story was republished from the Ohio Capital Journal under a Creative Commons license.