Well, one plausible argument I could see would be that the fed should have raised interest rates earlier. Not sure if I agree or not, but that seems a plausible argument.
Only plausible if the major driver of inflation has been too much demand, which is not clear at all.
I would argue, without the stats to back it up, that IMHO pent up demand from the pandemic slowdown exploded into the teeth of the supply chain issues, also created by the pandemic. We have yet to solve the supply chain sufficiently, and we have NOT slowed down demand. Even the obscene profits of the corporate world hasn't affected our frenzied desire to buy, buy, buy! Until we can tamp down demand, and/or, satisfy the demand with product at proper pricing, we're cooked. Fed action is one way, and should be substantial. Excess profit shaming or, even better, taxes, is another.
The U.S. Treasury Secretary -- the Cabinet member second in line to succeed the President, after the VP --admitted she was wrong about inflation.
Isn't a major administration figure, being wrong about a major issue, a legitimate basis for disapproval? Or is such disapproval "clueless"?
I don't know about you, but I prefer my administration officials to be right about stuff.
it's always better to be right. But as Yogi once said, predictions are hard, especially about the future. Lots of well-informed people expected inflation to subside earlier than it did. Probably few of them expected corporate profit-taking to be a factor. And even fewer expected Russia to invade Ukraine this year.
and not for nothing but many of people who were freaking out most over inflation were a lot of the same people who have been wrongly predicting runaway inflation for the past 20 years. It was hard to give them credibility after they cried wolf for so long.
and also not for nothing, but if inflation starts to moderate over the next few months (and there's at least a bit of evidence it might), how wrong were those people. Does "transitory" have a firm definition of a fixed number of months? If the worst of the inflation lasted for a year, and starts to recede, were the economists and administration officials really completely wrong?
I would argue, without the stats to back it up, that IMHO pent up demand from the pandemic slowdown exploded into the teeth of the supply chain issues, also created by the pandemic. We have yet to solve the supply chain sufficiently, and we have NOT slowed down demand. Even the obscene profits of the corporate world hasn't affected our frenzied desire to buy, buy, buy! Until we can tamp down demand, and/or, satisfy the demand with product at proper pricing, we're cooked. Fed action is one way, and should be substantial. Excess profit shaming or, even better, taxes, is another.
Agreed on all counts.
The extent it is not clear, but what is clear is that there was/is too much demand *given available supply*
We don't have a lot of useable tools to reduce demand, save Fed action. I think that corporations are relatively shameless, but a windfall profits tax on oil is not unprecedented and could get some Republican support.
and also not for nothing, but if inflation starts to moderate over the next few months (and there's at least a bit of evidence it might), how wrong were those people. Does "transitory" have a firm definition of a fixed number of months? If the worst of the inflation lasted for a year, and starts to recede, were the economists and administration officials really completely wrong?
Inflation probably will start to moderate, largely bc the Fed has turned pretty hawkish (finally) and there's a slope of rate increases ahead. But there's no unringing the bell of the administration being wrong on this issue last year.
And if inflation is considerably lower by the fall, I suspect it wouldn't go over very well if the administration tried to parse words and said they were right all along. That would be something Trump would do.
Inflation probably will start to moderate, largely bc the Fed has turned pretty hawkish (finally) and there's a slope of rate increases ahead. But there's no unringing the bell of the administration being wrong on this issue last year.
And if inflation is considerably lower by the fall, I suspect it wouldn't go over very well if the administration tried to parse words and said they were right all along. That would be something Trump would do.
if Biden was telling the country that inflation was a terrible problem that was going to persist for a year, would that have been a good thing? I don't see how it would have changed anything, or made the circumstances better. Do you think the Fed, which is supposed to be apolitical, would have ignored their own forecasts and started raising rates because Biden demanded it?
I just don't see what you expected Biden or anyone else in the cabinet to do a year ago, that would have changed history. I guess Biden could say "I told you so." Which probably wouldn't make much difference anyway to people who want to blame the president for the price of gas.
I'm still not sure how raising interest rates is going to moderate inflation in this environment, short of just throwing us into a full blown recession. How does higher borrowing costs lower the price of gas and food, the two biggest areas of concern? And won't higher borrowing costs just add more cost pressure on households?
Inflation probably will start to moderate, largely bc the Fed has turned pretty hawkish (finally) and there's a slope of rate increases ahead. But there's no unringing the bell of the administration being wrong on this issue last year.
And if inflation is considerably lower by the fall, I suspect it wouldn't go over very well if the administration tried to parse words and said they were right all along. That would be something Trump would do.
if Biden was telling the country that inflation was a terrible problem that was going to persist for a year, would that have been a good thing? I don't see how it would have changed anything, or made the circumstances better. Do you think the Fed, which is supposed to be apolitical, would have ignored their own forecasts and started raising rates because Biden demanded it?
I just don't see what you expected Biden or anyone else in the cabinet to do a year ago, that would have changed history. I guess Biden could say "I told you so." Which probably wouldn't make much difference anyway to people who want to blame the president for the price of gas.
so if a pollster called you and asked whether you approve/ disapprove Biden's handling of inflation, you'd say approve? If so, what specifically do you approve of?
or would you decline to answer, like db apparently, and instead lecture the pollster on the error of their ways for asking the question?
Inflation probably will start to moderate, largely bc the Fed has turned pretty hawkish (finally) and there's a slope of rate increases ahead. But there's no unringing the bell of the administration being wrong on this issue last year.
And if inflation is considerably lower by the fall, I suspect it wouldn't go over very well if the administration tried to parse words and said they were right all along. That would be something Trump would do.
if Biden was telling the country that inflation was a terrible problem that was going to persist for a year, would that have been a good thing? I don't see how it would have changed anything, or made the circumstances better. Do you think the Fed, which is supposed to be apolitical, would have ignored their own forecasts and started raising rates because Biden demanded it?
I just don't see what you expected Biden or anyone else in the cabinet to do a year ago, that would have changed history. I guess Biden could say "I told you so." Which probably wouldn't make much difference anyway to people who want to blame the president for the price of gas.
so if a pollster called you and asked whether you approve/ disapprove Biden's handling of inflation, you'd say approve? If so, what specifically do you approve of?
or would you decline to answer, like db apparently, and instead lecture the pollster on the error of their ways for asking the question?
From the summary, it appears the survey asked about Biden's handling of issues as simple approve/disapprove. So if that is the case, I would probably have bailed out on the survey because forcing respondents into that binary choice is bad question writing. My honest answer on Biden and inflation is that I neither approve nor disapprove. I don't see how he could have realistically done anything that would have changed the course of inflation. So what's to approve of? Or disapprove of?
and fwiw conducting surveys has actually been a big part of my professional career. So I know what I'm talking about when I tell you that asking questions in the way Ipsos seems to have asked about Biden makes for a crappy survey.
From the summary, it appears the survey asked about Biden's handling of issues as simple approve/disapprove. So if that is the case, I would probably have bailed out on the survey because forcing respondents into that binary choice is bad question writing. My honest answer on Biden and inflation is that I neither approve nor disapprove. I don't see how he could have realistically done anything that would have changed the course of inflation. So what's to approve of? Or disapprove of?
and fwiw conducting surveys has actually been a big part of my professional career. So I know what I'm talking about when I tell you that asking questions in the way Ipsos seems to have asked about Biden makes for a crappy survey.
It's not that it's crappy, it's that simple questions like that leave a lot of room for misinterpretation when only headline numbers are reported. (OTOH, maybe that is crappy.) The inflation question tells us nothing about Biden's actions on inflation. Rather, it tells us the psyche of the voters, which is not unimportant, but people like smedley don't see it that way. They think that Biden's policies must be wrong because (largely uninformed) people are dissatisfied. And I think most people view it that way, which sort of creates a feedback loop, making even more people feel dissatisfied, because they see a poll like this and assume Biden must be doing a bad job on inflation.
NEW POLL: An overwhelming & growing majority of Americans blame "corporations being greedy and raising prices to make record profits" as a cause of inflation.
Overall, 81% blame corporate greed for inflation, up 8 points since January w/ a 13 pt increase among independents. pic.twitter.com/mzXUqnPlMg
— Navigator Research (@NavigatorSurvey) June 1, 2022
It's not that it's crappy, it's that simple questions like that leave a lot of room for misinterpretation when only headline numbers are reported. (OTOH, maybe that is crappy.) The inflation question tells us nothing about Biden's actions on inflation. Rather, it tells us the psyche of the voters, which is not unimportant, but people like smedley don't see it that way. They think that Biden's policies must be wrong because (largely uninformed) people are dissatisfied. And I think most people view it that way, which sort of creates a feedback loop, making even more people feel dissatisfied, because they see a poll like this and assume Biden must be doing a bad job on inflation.
This topic on polls should be given its own category, because it's always the same discussion, no matter which thread it's in.
NEW POLL: An overwhelming & growing majority of Americans blame "corporations being greedy and raising prices to make record profits" as a cause of inflation.
Overall, 81% blame corporate greed for inflation, up 8 points since January w/ a 13 pt increase among independents. pic.twitter.com/mzXUqnPlMg
— Navigator Research (@NavigatorSurvey) June 1, 2022
Don't you know? Its those damn workers.
In a press conference on May 4, Powell announced that the Fed would be raising interest rates by half a percentage and implementing policies aimed at reducing inflation in the United States, which is at its highest level in 40 years.
He's a Republican so its expected that blame is heaped on employees.
So, thank you Biden for reappointing him. You can be sure a Republican president would never reappoint a Democrat holdover. Any still wondering why the republicans seem to be winning?
He's a Republican so its expected that blame is heaped on employees.
So, thank you Biden for reappointing him. You can be sure a Republican president would never reappoint a Democrat holdover. Any still wondering why the republicans seem to be winning?
Six years before he became chair, Powell was appointed to the Fed’s board of governors by Obama.
He's a Republican so its expected that blame is heaped on employees.
So, thank you Biden for reappointing him. You can be sure a Republican president would never reappoint a Democrat holdover. Any still wondering why the republicans seem to be winning?
Six years before he became chair, Powell was appointed to the Fed’s board of governors by Obama.
Meh. Republican, Democrat probably doesn't matter too much at this level. You've got to be pretty orthodox to be appointed Fed Chair. The Fed has one tool for fighting inflation and even if Yellen was still Chair, she probably would have taken the same action. She might not have focused on labor costs in public announcements, but the policy effect would still be the same.
"Powell blamed this inflation crisis, which is global, not on the proxy war in Ukraine"? From the transcript:
"The surge in prices of crude oil and other commodities that resulted from Russia’s invasion of Ukraine is creating additional upward pressure on inflation. And COVID-related lockdowns in China are likely to further exacerbate supply chain disruptions as well. ... In addition to the effects on inflation, the invasion and related events are likely to restrain economic activity abroad and further disrupt supply chains, creating spillovers to the U.S. economy through trade and other channels."
He's a Republican so its expected that blame is heaped on employees.
So, thank you Biden for reappointing him. You can be sure a Republican president would never reappoint a Democrat holdover. Any still wondering why the republicans seem to be winning?
Six years before he became chair, Powell was appointed to the Fed’s board of governors by Obama.
It's not that it's crappy, it's that simple questions like that leave a lot of room for misinterpretation when only headline numbers are reported. (OTOH, maybe that is crappy.) The inflation question tells us nothing about Biden's actions on inflation. Rather, it tells us the psyche of the voters, which is not unimportant, but people like smedley don't see it that way. They think that Biden's policies must be wrong because (largely uninformed) people are dissatisfied. And I think most people view it that way, which sort of creates a feedback loop, making even more people feel dissatisfied, because they see a poll like this and assume Biden must be doing a bad job on inflation.
I probably should have explained why I think a simple approve/disapprove question is crappy design. Again, the link with the summary showed only two alternatives (plus the % who didn't answer), so maybe the actual questionnaire had more gradation. But even if it had "somewhat" approve or disapprove, it couldn't have had a response for "neither" or "don't know," because the approve and disapprove %s added to nearly 100%.
Some pollsters like to force respondents to one side or the other on a question by leaving out a midpoint. But in my professional opinion, forcing responses is bad policy because usually neither/nor is a valid response that represents the person's real opinion. Other times "don't know" would be a valid response.
In this case I'm actually surprised even 28% approve of Biden on inflation if the choice is only agree or disagree. Pretty much all of us know inflation is bad. So if you don't "approve" of Biden on this issue, "disapprove" is your only other choice. Even if you neither approve or disapprove, or don't know enough to have an opinion.
If you ask people a question they generally will give an answer (which is why the Ipsos questions had so few non responses). But just because people give you answers doesn't mean those answers are particularly valuable.
and with regard to whether or not media have "scaremongered" on inflation, I'd be more inclined to say inflation has been hyped to the exclusion of other economic metrics that put it in context. Job creation has been strong, and last month people who had left the work force started coming back. Jobs aren't back to pre-pandemic levels, but they may not get there for a while because some people decided not to go back so they could retire or stay home with kids (and that might not be a bad thing). Also, part of the cause of inflation is wage increases, especially to people toward the bottom of the income distribution like hospitality workers. Also not a bad thing.
And finally if we are going to depend on surveys for "truth" on the economy, when people are surveyed about their own economic well-being, they are very optimistic. And they also don't expect inflation to persist long term.
Yes people are annoyed when the price of gas doubles or the price of food goes up. But when they are asked about their own economic prospects, people are pretty positive. Maybe the price of gas alone would be enough for voters to slam Democrats in November (after all as Americans we do have a God-given right to cheap gas, don't we?). But maybe the politics of the economy would be different if the good news got equal play with inflation.
and with regard to whether or not media have "scaremongered" on inflation, I'd be more inclined to say inflation has been hyped to the exclusion of other economic metrics that put it in context. Job creation has been strong, and last month people who had left the work force started coming back. Jobs aren't back to pre-pandemic levels, but they may not get there for a while because some people decided not to go back so they could retire or stay home with kids (and that might not be a bad thing). Also, part of the cause of inflation is wage increases, especially to people toward the bottom of the income distribution like hospitality workers. Also not a bad thing.
And finally if we are going to depend on surveys for "truth" on the economy, when people are surveyed about their own economic well-being, they are very optimistic. And they also don't expect inflation to persist long term.
Yes people are annoyed when the price of gas doubles or the price of food goes up. But when they are asked about their own economic prospects, people are pretty positive. Maybe the price of gas alone would be enough for voters to slam Democrats in November (after all as Americans we do have a God-given right to cheap gas, don't we?). But maybe the politics of the economy would be different if the good news got equal play with inflation.
This post is along the lines of my and PVW's prior posts that the inflation we are experiencing has been "worth it."
The problem with that outlook is that most people didn't lose their jobs and we all know that Republicans don't care about the poor, or anyone else for that matter.
Inflation probably will start to moderate, largely bc the Fed has turned pretty hawkish (finally) and there's a slope of rate increases ahead. But there's no unringing the bell of the administration being wrong on this issue last year.
And if inflation is considerably lower by the fall, I suspect it wouldn't go over very well if the administration tried to parse words and said they were right all along. That would be something Trump would do.
if Biden was telling the country that inflation was a terrible problem that was going to persist for a year, would that have been a good thing? I don't see how it would have changed anything, or made the circumstances better. Do you think the Fed, which is supposed to be apolitical, would have ignored their own forecasts and started raising rates because Biden demanded it?
I just don't see what you expected Biden or anyone else in the cabinet to do a year ago, that would have changed history. I guess Biden could say "I told you so." Which probably wouldn't make much difference anyway to people who want to blame the president for the price of gas.
so if a pollster called you and asked whether you approve/ disapprove Biden's handling of inflation, you'd say approve? If so, what specifically do you approve of?
or would you decline to answer, like db apparently, and instead lecture the pollster on the error of their ways for asking the question?
From the summary, it appears the survey asked about Biden's handling of issues as simple approve/disapprove. So if that is the case, I would probably have bailed out on the survey because forcing respondents into that binary choice is bad question writing. My honest answer on Biden and inflation is that I neither approve nor disapprove. I don't see how he could have realistically done anything that would have changed the course of inflation. So what's to approve of? Or disapprove of?
and fwiw conducting surveys has actually been a big part of my professional career. So I know what I'm talking about when I tell you that asking questions in the way Ipsos seems to have asked about Biden makes for a crappy survey.
Well you must be very disappointed in Biden now. He's made clear, just in the past week, that fighting inflation is his top priority. But if (according to you) he couldn't have done anything to date that would have changed the course of inflation, what can he do now?
Seems like a lot of bandwidth to spend tilting at windmills, wouldn't you say?
Inflation probably will start to moderate, largely bc the Fed has turned pretty hawkish (finally) and there's a slope of rate increases ahead. But there's no unringing the bell of the administration being wrong on this issue last year.
And if inflation is considerably lower by the fall, I suspect it wouldn't go over very well if the administration tried to parse words and said they were right all along. That would be something Trump would do.
if Biden was telling the country that inflation was a terrible problem that was going to persist for a year, would that have been a good thing? I don't see how it would have changed anything, or made the circumstances better. Do you think the Fed, which is supposed to be apolitical, would have ignored their own forecasts and started raising rates because Biden demanded it?
I just don't see what you expected Biden or anyone else in the cabinet to do a year ago, that would have changed history. I guess Biden could say "I told you so." Which probably wouldn't make much difference anyway to people who want to blame the president for the price of gas.
so if a pollster called you and asked whether you approve/ disapprove Biden's handling of inflation, you'd say approve? If so, what specifically do you approve of?
or would you decline to answer, like db apparently, and instead lecture the pollster on the error of their ways for asking the question?
From the summary, it appears the survey asked about Biden's handling of issues as simple approve/disapprove. So if that is the case, I would probably have bailed out on the survey because forcing respondents into that binary choice is bad question writing. My honest answer on Biden and inflation is that I neither approve nor disapprove. I don't see how he could have realistically done anything that would have changed the course of inflation. So what's to approve of? Or disapprove of?
and fwiw conducting surveys has actually been a big part of my professional career. So I know what I'm talking about when I tell you that asking questions in the way Ipsos seems to have asked about Biden makes for a crappy survey.
Well you must be very disappointed in Biden now. He's made clear, just in the past week, that fighting inflation is his top priority. But if (according to you) he couldn't have done anything to date that would have changed the course of inflation, what can he do now?
Seems like a lot of bandwidth to spend tilting at windmills, wouldn't you say?
He can't do anything now. He is blustering. However, if inflation begins to moderate soon, he can take credit.
Inflation probably will start to moderate, largely bc the Fed has turned pretty hawkish (finally) and there's a slope of rate increases ahead. But there's no unringing the bell of the administration being wrong on this issue last year.
And if inflation is considerably lower by the fall, I suspect it wouldn't go over very well if the administration tried to parse words and said they were right all along. That would be something Trump would do.
if Biden was telling the country that inflation was a terrible problem that was going to persist for a year, would that have been a good thing? I don't see how it would have changed anything, or made the circumstances better. Do you think the Fed, which is supposed to be apolitical, would have ignored their own forecasts and started raising rates because Biden demanded it?
I just don't see what you expected Biden or anyone else in the cabinet to do a year ago, that would have changed history. I guess Biden could say "I told you so." Which probably wouldn't make much difference anyway to people who want to blame the president for the price of gas.
so if a pollster called you and asked whether you approve/ disapprove Biden's handling of inflation, you'd say approve? If so, what specifically do you approve of?
or would you decline to answer, like db apparently, and instead lecture the pollster on the error of their ways for asking the question?
From the summary, it appears the survey asked about Biden's handling of issues as simple approve/disapprove. So if that is the case, I would probably have bailed out on the survey because forcing respondents into that binary choice is bad question writing. My honest answer on Biden and inflation is that I neither approve nor disapprove. I don't see how he could have realistically done anything that would have changed the course of inflation. So what's to approve of? Or disapprove of?
and fwiw conducting surveys has actually been a big part of my professional career. So I know what I'm talking about when I tell you that asking questions in the way Ipsos seems to have asked about Biden makes for a crappy survey.
Well you must be very disappointed in Biden now. He's made clear, just in the past week, that fighting inflation is his top priority. But if (according to you) he couldn't have done anything to date that would have changed the course of inflation, what can he do now?
Seems like a lot of bandwidth to spend tilting at windmills, wouldn't you say?
I'm not disappointed in Biden. It's politics. He isn't speaking to me with any of that. He's speaking to the likes of you who think he's got a presidential magic wand to stop inflation. And he's got to do that for political reasons.
and with regard to whether or not media have "scaremongered" on inflation, I'd be more inclined to say inflation has been hyped to the exclusion of other economic metrics that put it in context. Job creation has been strong, and last month people who had left the work force started coming back. Jobs aren't back to pre-pandemic levels, but they may not get there for a while because some people decided not to go back so they could retire or stay home with kids (and that might not be a bad thing). Also, part of the cause of inflation is wage increases, especially to people toward the bottom of the income distribution like hospitality workers. Also not a bad thing.
And finally if we are going to depend on surveys for "truth" on the economy, when people are surveyed about their own economic well-being, they are very optimistic. And they also don't expect inflation to persist long term.
Yes people are annoyed when the price of gas doubles or the price of food goes up. But when they are asked about their own economic prospects, people are pretty positive. Maybe the price of gas alone would be enough for voters to slam Democrats in November (after all as Americans we do have a God-given right to cheap gas, don't we?). But maybe the politics of the economy would be different if the good news got equal play with inflation.
This post is along the lines of my and PVW's prior posts that the inflation we are experiencing has been "worth it."
The problem with that outlook is that most people didn't lose their jobs and we all know that Republicans don't care about the poor, or anyone else for that matter.
a lot of the hype is pure politics. And also most news outlets like news that is of course novel ("highest rate in 40 years!"), and they also have a bad news bias. The partisan hacks are having a field day with the headlines.
I thought it was interesting that a credible report said Yellen wanted to cut the March 2021 stimulus package due to inflation concerns. She has denied the report, but I suspect the report is true and the denial is just her being the good soldier and team player.
Of course there's no presidential magic wand on inflation, but at the same time, there are things and more things a president can do to fight inflation. And when the president is all about stimulus and waves off inflationary concerns for a very long time, and then inflation soars, the president was wrong on inflation.
So ultimately one can approve of how Biden is handling inflation for whatever reason(s), or abstain from answering due to the semantics of the question (kinda lame if you ask me, but w/e). But there are also valid reasons to disapprove of how Biden has handled inflation. If that disapproval is "irrational" or "uninformed", then I don't want to be rational or informed.
I thought it was interesting that a credible report said Yellen wanted to cut the March 2021 stimulus package due to inflation concerns. She has denied the report, but I suspect the report is true and the denial is just her being the good soldier and team player.
Of course there's no presidential magic wand on inflation, but at the same time, there are things and more things a president can do to fight inflation. And when the president is all about stimulus and waves off inflationary concerns for a very long time, and then inflation soars, the president was wrong on inflation.
So ultimately one can approve of how Biden is handling inflation for whatever reason(s), or abstain from answering due to the semantics of the question (kinda lame if you ask me, but w/e). But there are also valid reasons to disapprove of how Biden has handled inflation. If that disapproval is "irrational" or "uninformed", then I don't want to be rational or informed.
it's not completely thinking the issue through to just "disapprove" of how Biden (and Congress) "handled" inflation. As PVW and jimmurphy have also pointed out, we can't have it all when it comes to the economy. Less stimulus would have likely meant more unemployment, more poverty, more evictions (assuming that less stimulus also meant allowing evictions during the pandemic), and slower recovery. It probably would have also meant a lot more COVID deaths because more people would have continued to go to a workplace if they weren't receiving pandemic relief.
"Disapproving" of Biden's "handling" of inflation also means either ignoring the likely other effects of not having COVID relief funding, or not understanding how those factors work together.
I don't like high inflation any more than anyone else. But if there was less money spent on COVID relief, I really worry about what our country would look like today from an economic and human suffering standpoint. But maybe you are well-informed and rational, but you think somehow the economy would have been fine without COVID relief, and job growth would have been strong anyway. Or maybe you just don't care if it hadn't been.
Of course there's no presidential magic wand on inflation, but at the same time, there are things and more things a president can do to fight inflation. And when the president is all about stimulus and waves off inflationary concerns for a very long time, and then inflation soars, the president was wrong on inflation.
Whether the admin should be doing "things and more things" is a more interesting discussion than whether the admin said the right words, or how people responded to a poll.
FWIW, I agree with Ygelsias that the Biden admin should remove the Trump tariffs.
I would argue, without the stats to back it up, that IMHO pent up demand from the pandemic slowdown exploded into the teeth of the supply chain issues, also created by the pandemic. We have yet to solve the supply chain sufficiently, and we have NOT slowed down demand. Even the obscene profits of the corporate world hasn't affected our frenzied desire to buy, buy, buy! Until we can tamp down demand, and/or, satisfy the demand with product at proper pricing, we're cooked. Fed action is one way, and should be substantial. Excess profit shaming or, even better, taxes, is another.