The July report for consumer prices from the Bureau of Labor Statistics, which came out today, showed that prices rose less than 3% in the previous twelve months. Core inflation has fallen to its lowest rate since April 2021. For well over a year, wages have grown faster than inflation.
President Joe Biden cheered the news but added in a statement, “Prices are still too high. Large corporations are sitting on record profits and not doing enough to lower prices. That’s why we are taking on Big Pharma to lower prescription drug prices. We’re cutting red tape to build more homes while taking on corporate landlords that unfairly increase rent. And we’re taking on price gouging and junk fees to lower everyday costs from groceries to air travel.”
When a reporter asked Biden if the U.S. has beaten inflation, Biden answered: “Yes, Yes, Yes. I told you we were going to have a soft landing…. My policies are working. Start writing that way.”
Just yesterday, the administration announced $100 million worth of investments in new housing in the form of grants to state and local governments to spur the production of new housing. Kriston Capps of Bloomberg reports that “more housing units are under construction now than at any point in half a century—some 60,000 multifamily units were completed in June alone—and rents are stabilizing in some areas as a result.”
Single-family home construction is slower, and with Senate Republicans having blocked a $78 billion tax deal that would support housing tax credits that promote the construction of housing, the White House is finding other ways to spur housing construction.
On Monday the White House continued its attempt to protect the interests of consumers after years in which they lost ground. Continuing to combat junk fees, it proposed rules to fight back against “all the ways that corporations—through excessive paperwork, hold times, and general aggravation—add unnecessary headaches and hassles to people’s days and degrade their quality of life.”
Companies deliberately design processes to be burdensome in order to deter people from getting a refund or a rebate, or canceling a membership or a subscription. Those frustrations waste money and time, the administration said, and after listing some of its own proposals for making it easier to navigate ending subscriptions or activating insurance coverage, it invited Americans to submit their own on a public portal.
In a speech on Friday in North Carolina, Vice President Kamala Harris is expected to take on the issue of price gouging by large corporations. Researchers for U.K. think tanks Institute for Public Policy Research and Common Wealth found in late 2023 that profiteering, or “greedflation,” “significantly” boosted prices, leading to increases of 30% or more in corporate profits. “Excessive profits were even larger in the US, where many important sections of the economy are dominated by a few powerful companies,” wrote Phillip Inman of The Guardian.
Responding to today’s news that inflation is coming down, the stock market ticked up in expectation that the Fed will now be more likely to cut interest rates in September.
The White House took notice today of the fact that applications for small businesses continue to boom across the country, with 19 million new business applications since Vice President Harris and President Biden took office, an annual growth rate 90% higher than prepandemic averages. The White House also noted that congressional Republicans are trying to cut the Small Business Administration and to cut taxes for big corporations.
Politico greeted today’s economic news with a headline saying, “Inflation is easing. Now, Harris has an even bigger problem with the economy.” And the New York Times reported that in a speech in North Carolina, “Harris Is Set to Lay Out an Economic Message Light on Details,” adding that she is expected to tweak Biden administration themes “in a bid to turn the Democratic economic agenda into an asset.”
The United States economy under Biden and Harris has been the strongest in the world, and now that inflation seems to be under control as well, Harris needs to turn that record “into an asset”? Political journalist James Fallows wrote: “Now they are all just trolling us.”
The Biden-Harris administration has changed the orientation of the United States government from relying on markets to order society and protecting the interests of wealthy Americans in the expectation that they would invest in the economy more efficiently than they could if the government interfered by protecting workers and consumers. Biden and Harris, along with the cabinet officers and staff of the executive branch, revived an older ideology calling for the government to promote the interests of the American people as a whole. This means regulating business and providing government services and oversight to make sure no interest can run the table.
What the two different worldviews look like was on display earlier this month, when Republicans and a few Democrats in the Senate killed a bipartisan expansion of the child tax credit, a tax break for parents with dependent children. A hike in that credit during the pandemic cut child poverty dramatically, only for that rate to bounce back when the pandemic relief expired and dropped five million U.S. children back into poverty in 2022. The Center on Budget and Policy Priorities noted that the change “underscores the fact that the number of children living in poverty is a policy choice.”
On January 31, 2024, the House passed an expansion of the child tax credit that was smaller than the one in place during the pandemic, and Republican vice presidential hopeful Ohio senator J.D. Vance, who has been criticized for comments about “childless cat ladies,” seemed to support the measure when he said, “If you’re raising children in this country, we should make it easier, not harder. And unfortunately it’s way too expensive and way too difficult.” He then falsely accused Democratic presidential candidate Kamala Harris of calling for ending the child tax credit (she has actually called for expanding it).
But Vance missed the vote, and before it, Senator Thom Tillis (R-NC) told colleagues that passing the bill would “give Harris a win before the election.” According to Chabeli Carranzana of The 19th, Tillis “printed out fake checks made out to ‘millions of American voters’ with the memo: ‘Don’t forget to vote for Kamala!’”
The two different worldviews were also on display Monday night when Republican presidential candidate Donald Trump complimented X owner Elon Musk for firing workers who threatened to strike. The right to strike is protected under federal labor law, and the Biden-Harris administration has stood firmly for workers’ rights.
On Tuesday the United Auto Workers union filed charges against Trump and Musk with the National Labor Relations Board for threatening and intimidating workers. “When we say Trump stands against everything our union stands for, this is what we mean,” said UAW president Shawn Fain.
Tonight, Trump gave a speech in Asheville, North Carolina, that was supposed to be about the economy. Before he could appear, Trump had to pay the city $82,247.60 in advance, with city officials apparently concerned about the candidate’s habit of skipping out on costs associated with his rallies. Once on stage, he tossed economic issues overboard and concentrated on personal attacks on Biden and Harris, along with stream-of-consciousness musings on tampons and socialism. Apparently speaking of his campaign aides, he said: They wanted to do a speech on the economy. They say it’s the most important subject. I’m not sure it is.”
The era of unfettered markets and the concentration of wealth may be coming to an end. In late July, the finance leaders of the Group of 20 (G20), a forum of the world’s major economies, agreed to cooperate on fair taxation of "ultra-high-net-worth individuals,” although they did not agree as to whichinternational body should lead.
But yesterday, Joe Perticone of The Bulwark noted that MAGA Republicans appear to have figured out a way to use the struggle over the nation’s economic ideology to elect Trump.
The House recessed in late July having failed to pass a single one of the 12 appropriations bills the government needs to stay in operation because, although the appropriations bills are traditionally kept “clean” of anything extraneous, extremist members of the House Freedom Caucus insist on making extreme cuts and adding their culture war items to the bills. Congress doesn’t reconvene until early September, and the new fiscal year starts on October 1, leaving the House very little time to pass the necessary bills.
Yesterday, members of the House Freedom Caucus called for Republicans to return to Washington, D.C., to pass the bills “to cut spending and advance our policy priorities.” If they can’t pass the bills—and they failed all spring—the extremists want a short-term fix just into “President Trump’s second term.” But they also want the fix to include the SAVE Act, “as called for by President Trump—to prevent noncitizens from voting [and] to preserve free and fair elections in light of the millions of illegal aliens imported by the Biden-Harris administration over the last four years.”
It is already illegal for noncitizens to vote in federal elections. As Perticone notes, Trump’s own 2017 commission to find evidence that undocumented immigrants voted in 2016 disbanded without finding any, and another audit, led by Georgia Republicans before the 2022 midterms, found not a single successful attempt of noncitizens to vote in the previous five years.
Perticone reports that the measure is designed to suppress legitimate Democratic voting and, if Trump still loses, by claiming that Trump lost, again, because the election was stolen by illegal voters.
Trump continues to insist that Biden’s replacement at the top of the Democratic ticket was a “coup,” partly because he wants to face off against Biden, rather than Harris. But he also is priming his supporters to believe that those Americans who want the government to work for them rather than the very wealthy are illegitimate.
come november...