A chairman of the White House Bureau of Economic Analysis named Jared Bernstein acknowledged inflation may not yet be at its greatest point.
Bernstein was questioned about the inflationary issue in a discussion with Saleha Mohsin, senior Washington reporter for Bloomberg News.
“I have heard many claims that the peak is over now.” According to a tweet from Mohsin on August 30, Bernstein responded, “I’m simply going to be a lot less careful than that.”
“I definitely see where they’re going from in terms of logic. There are still unanswered questions.”
A few weeks ago, Bernstein told the press with CNN that American families “typically have quite solid balance sheet” and are “out there spending at a decent rate,” despite their worries about the economy and rising costs.
Additionally, he maintained many Americans equate massive inflation with an economic downturn.
— AFP News Agency (@AFP) August 31, 2022
In a July interview with Fox News, Bernstein acknowledged inflation was “alarmingly high.” President Biden claimed over a year ago no credible economist believed the US would experience unchecked inflation.
When asked why the White House mishandled the situation, Bernstein cited “some unanticipated factors,” notably the turmoil in Ukraine.
“Both Russia and Ukraine are the world’s largest breadbasket and oil sources. These have significantly pushed prices upward,” he added.
However, inflation has been a major issue well before the Russia–Ukraine war.
The Issue of Inflation
The 12-month Consumer Price Index, which gauges average increase, was barely 1.4 percent in January 2021, when Biden was elected president, according to data from the U.S. Bureau of Labor Statistics.
By year’s end in 2021, CPI had increased five times every single year, reaching seven percent. CPI was 7.9 percent when Russia attacked Ukraine in late February.
Then, it reached a high of 9.1% in June; by July, it had decreased to 8.5 percent.
Inflation is how democracies die.
— Naval (@naval) August 30, 2022
The CPI increased by 7.1 percentage points between January 2021 and July 2022, of which the 6.5 percent range occurred prior to Russia’s conflict with Ukraine.
Steve Hanke, a lecturer of economics at Johns Hopkins University, noted the “extraordinary rise” in the supply of money that started when COVID-19 got underway two years ago is the reason why inflation will continue to be high in an interview with CNBC.
He believes the inflation problem will last through 2023 and perhaps into 2024. This is very much in line with the inflation predictions made by other economists during the Biden administration’s time in the White House.
Hanke stated, “The issue we have now is that [Federal Reserve Chair Jerome Powell] does not really now comprehend what the drivers of inflation are today and were before.”
He continues to talk about supply-side issues. He neglected to mention that excessive money supply expansion, which activates the printing presses, is a constant source of inflation.