Inflation remains one of Biden’s most persistent problems

It may be far from mind at the moment, but the inflation problem persists.

Year-over-year price hikes remained at 3.7% for the year ending in September, while core inflation that strips out food and energy prices fell to 4.1%. Those figures are down from a year ago but remain roughly double the Federal Reserve‘s 2% target.

HIGHER SHELTER AND ENERGY PRICES PROPPED UP INFLATION AT 3.7% IN SEPTEMBER

President Joe Biden and other Democrats touted the numbers as “Bidenomics” at work, while Republicans pointed to them as proof that “Bidenflation” is here to stay.

“This morning’s report shows core inflation fell to its lowest level in two years,” Biden wrote in a prepared statement. “Overall inflation is down by 60% from its peak at a time when unemployment has remained below 4% for 20 months in a row, and the share of working-age Americans in the workforce is the highest in 20 years. That’s Bidenomics in action.”

Meanwhile, Job Creators Network CEO Alfredo Ortiz wrote that “due to this Bidenflation, ordinary Americans are poorer,” blaming “reckless spending by the Biden administration and Congressional Democrats” and calling for government spending cuts.

Inflation stood at just 1.4% the month Biden took office, then surged to 5% by May and peaked at 9.1% in June 2022 before falling steadily over the last year. It has been stuck at around 4% since late spring, refusing to fall further toward the 2% target.

Republicans point specifically to the American Rescue Plan, a $1.9 trillion stimulus bill passed in March 2021 with no GOP votes, as the cause of inflation. Democrats tend to point toward rising prices globally to argue that the issue is not limited to U.S. policy decisions.

Gerald Friedman, a University of Massachusetts economics professor, says the 4% figure is manageable, and worries more about international events upsetting the economy than the need to reach 2%.

“This is a rate of inflation that the country can accommodate. Everybody will get used to it and we’ll be fine. Two percent would be the same,” he said. “The question is volatility, and frankly, given things going on right now, I’m a little nervous.”

The Israel-Gaza conflict could escalate, he adds, or could affect oil production the way the 1973 Yom Kippur War did.

While last weekend’s terrorist attacks have certainly dominated national and international news cycles, Biden hasn’t stopped talking about the economy.

He spoke Wednesday about protecting consumers from “junk fees,” met Thursday with a group of business CEOs to talk about the economy, and will give a speech Friday in Philadelphia about how the “Bidenomics agenda” is creating union jobs, better infrastructure, and clean energy to combat climate change.

But if inflation sticks around by this time next year, Biden may work to shift the focus away from it and onto the GOP. Republicans predicted a midterm “red wave” when inflation tipped above 9% in the summer of 2022. Biden instead focused on “ultra-MAGA” Republicans and the danger they posed to democracy. That, along with the aftermath of the Supreme Court sending abortion policy back to the states, helped his party outperform midterm expectations.

Republicans will keep the heat up on the economy so long as it appears to be a weak spot for the president. Biden’s average economic approval is roughly net negative 24 percentage points, according to RealClearPolitics, with an average of 45% of respondents telling pollsters they think the country is heading in the wrong direction.

While the year-over-year inflation figure is no longer eye-popping, GOPers are betting that voters have a memory that stretches back a little further.

“It’s important to remember that since President Biden took office, prices have increased by around 20%, reducing Americans’ real wages and living standards,” Ortiz wrote.

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Democratic strategist Michael Stratton argues that Republican attacks on the economy are a reach.

“They can’t say anything good about Biden because they’re in the middle of an election campaign,” Stratton said. “[The 20% figure] is one of the most contrived analyses I’ve ever heard.”