The White House expects further economic problems and a tough mid-term battle


WASHINGTON – White House officials, now believing parts of the economy will continue to struggle in the coming months, are looking for ways to stave off a potential threat to the democratic outlook in the 2022 election.

While the economy has improved significantly since President Joe Biden’s early days in office, the president and senior administrators last week for a second month of slower-than-expected attitudes resulted in the recovery not moving as fast as they’d like and that inflation and labor shortages could continue for months.

That leaves the White House considering the prospect of a slowing economic recovery for the remainder of Biden’s first year – and through 2022. To communicate in the coming months, administrative officials plan to highlight any bright spots they can find, such as rising wages and the pace of economic growth, and use the weaknesses to bolster their opinion on why Congress passed a proposed 3 spending bill . To say goodbye to $ 5 trillion, according to someone close to the White House.

The latest numbers leave the White House on the prospect of a slowdown in the economic recovery for the remainder of President Joe Biden’s first year.Matthew Hatcher / Bloomberg via Getty Images

White House officials also plan to continue their vaccination efforts in hopes that more workplace mandates will encourage people to return to work in the coming months, the person said. To show he’s working to fix product bottlenecks, some of which are caused by bottlenecks in major shipping ports, Biden will meet with ship managers and officials from Walmart, UPS and Home Depot on Wednesday.

The prospect of a sluggish economy through 2022 is causing Democratic strategists to prepare for what that could mean for their prospects in the mid-term elections. Republicans say they plan to capitalize on the weaknesses of the economy in hopes of linking inflation and labor shortages to Biden’s policies as part of their pitch in front of the electorate.

“When people are paying more for everything and prices are skyrocketing than wages, that’s a strong campaign message for Republicans at halftime,” said a Republican chief of staff in the House of Representatives. “If the average American pays more for gas and groceries under a Democratic-controlled government, Republicans can live with it.”

The latest economic figures add to the list of setbacks the president has suffered in recent months. Biden stepped into August after the United States created nearly a million jobs in July, Covid-19 deaths near their lowest point, and the Senate on the verge of reaching an agreement on a $ 550 billion infrastructure package. But two months later, the nation is only adding a fraction of that number of jobs, nearly 2,000 mostly unvaccinated people die from Covid every day, and the infrastructure bill is bogged down in Congress.

Amid domestic problems, Biden has also been criticized in the past two months for his handling of the withdrawal of US troops from Afghanistan and the response to a flood of migrants on the southern border.

These issues seem to weigh on his polling results. Only 38 percent of people agreed with the work Biden did, the lowest score he has received since he took office, according to a Quinnipiac poll released last week. In terms of the economy, only 2 percent of respondents said the economy was “excellent” and 27 percent said it was “good,” while 69 percent said the economy was “not that good” or “bad,” as the survey found.

White House officials believe the passage of two spending bills – the $ 550 billion infrastructure bill and the proposed $ 3.5 trillion social safety net bill – will provide Democrats with a pivotal platform for 2022 will, despite all the economic headwinds for the next year, a person familiar with it said the White House strategy.

The White House believes the bills could also address some of the short-term problems in the economy, such as the provision of childcare and elderly care help to get people back into the job market, the person said. However, both laws stalled in Congress as Democrats argue over which programs should be included, how they should be paid for, and what the price should be.

“The economy is a huge pain point for the White House,” said a democratic strategist close to the government. “I think that’s why they rely so heavily on this infrastructure bill, they think the investment will be good for the economy, and I think that’s why they were so optimistic about the spending.”

The White House tried last week to highlight the bright spots in the September job report released Friday, which showed the US created 194,000 jobs that month, compared to the Dow Jones estimate of 500,000.

In remarks following the publication of the job numbers, Biden referred to a decline in the unemployment rate, an increase in wages and the rate of growth over the course of his presidency. He also tried to highlight the nearly 5 million jobs that have been created since he took office.

But while the White House has been talking about economic advances, it has also used the flaws to argue why Congress needs to pass Biden’s spending laws. Following last week’s job report, Biden argued the economy was on a steady path, but admitted that it was not recovering as quickly as he would like.

“We’re actually making real progress,” he said. “Maybe it doesn’t seem fast enough, I would like to see it faster and we’ll do it faster, maybe it doesn’t seem dramatic enough. But, as I said, I too want to make faster progress. However, we are making steady progress. “

Senior government officials, including Treasury Secretary Janet Yellen, have predicted that consumers could continue to see higher prices and product shortages for the remainder of the year as the market continues to function amid supply chain bottlenecks and labor shortages. Inflation is 3.6 percent year-over-year, a 30-year high on the Federal Reserve’s preferred inflation measure.

“There have been supply shortages that have caused inflation,” she said in an interview with CNBC last week. “I think they are temporary, but that doesn’t mean they will go away in the next few months.”

White House officials said they believe a key factor in helping Americans return to work and addressing corporate labor shortages is increasing vaccination rates. Officials said they hope an upcoming requirement from the Department of Labor for large companies to ensure their workers are vaccinated or regularly tested will further spur it on, but that requirement from the employer will likely be weeks away from implementation, according to one with the Process trusted person.

Another factor that could change the course of the economy in the coming months is whether the Federal Reserve decides to withdraw aid from the central bank, which would result in higher interest rates. Federal Reserve Chairman Jerome Powell has announced that it will do so before the end of the year, although Friday’s lower-than-expected employment numbers could affect that decision.

Meanwhile, Republicans plan to keep an eye out for weaknesses in the economy as they campaign for the 2022 midterm election.

“There are a number of issues that voters care about entering the voting booth, the economy is always number one,” said Dan Eberhart, a major Republican financier and CEO of energy companies. “Biden tries to blame the Republicans for the downward spiral in the economy, but it’s not going to fly.”

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