Former Obama economic adviser Steven Rattner did not shy away from his critical New York Times op-ed taking President Biden to task for getting inflation “so wrong,” particularly after he said he “warned” the administration about it.
In a “Morning Joe” interview Monday, Rattner doubled down on his critique, saying Biden’s Build Back Better plan, a $1.75 trillion social spending and climate package, will very likely “add to the deficit.” His prediction squares with new analysis from the Congressional Budget Office that concluded the bill will add about $367 billion to the deficit.
Rattner argued it started with the $1.9-trillion coronavirus relief package Biden signed this year.
“The original sin was the $1.9 trillion American Rescue Plan, passed in March. The bill — almost completely unfunded — sought to counter the effects of the Covid pandemic by focusing on demand-side stimulus rather than on investment,” he wrote. “That has contributed materially to today’s inflation levels.”
He continued to say on MSNBC he and other economists “warned” Biden that “shoveling an unprecedented amount of spending into an economy already on the road to recovery would mean too much money chasing too few goods.”
Rattner said it would be “irresponsible” of him to suggest “massive” inflation would arise with Build Back Better due to the size of the U.S. economy, but still sounded the alarm on its impact on the deficit, particularly with the frontloaded spending included in the bill.
“I’m simply suggesting that inflationary pressure, as we well do, and as everyone can see, the last thing you want to do is add to it,” he said. “If you’re basically promising the American people a balanced program that we are not going to add to the deficit, and this has been one of the administration’s biggest selling points, that it’s not going to add to the deficit, then you have to have a program that reasonable people could look at and say it’s not going to add to the deficit.”
U.S. President Joe Biden announces the nomination of Federal Reserve Chair Jerome Powell for a second four-year term, in the Eisenhower Executive Office Building’s South Court Auditorium at the White House in Washington, U.S., November 22, 2021. REUTERS/Kevin Lamarque (REUTERS/Kevin Lamarque)
“We’re setting the stage essentially for trillions of dollars of more government deficit and debt,” he said in conclusion.
U.S. President Joe Biden delivers remarks about his Build Back Better agenda and the bipartisan infrastructure deal as Vice President Kamala Harris stands by in the East Room of the White House in Washington, U.S., October 28, 2021. (REUTERS/Jonathan Ernst)
The inflation crisis has repeatedly been one of Americans’ top concerns this year, and it’s spilled over to the holiday season.
“Inflation Rate Set to Spoil Holiday Season for Struggling Families,” Bloomberg News reported.
“Inflation means Thanksgiving dinner will cost extra this year,” a CNBC headline read.
"Thanksgiving 2021 could be the most expensive meal in the history of the holiday," The New York Times reported. (iStock)
“This Year’s Thanksgiving Feast Will Wallop the Wallet,” the New York Times wrote.