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WH trumpets US growth topping China as inflation drags on Biden

WH trumpets US growth topping China as inflation drags on


The Biden administration touted a new analysis Friday suggesting America’s economic growth will exceed China’s for the first time since the 1970s — claiming it was an affirmation of the president’s policies despite broad frustration with high inflation.

Bloomberg Economics published a report Thursday putting US GDP growth at about 2.8% in 2022 as opposed to just 2% for China — taking into account the likely impact of the Communist nation’s strict COVID-19 shutdowns.

“A new independent analysis projected that, for the first time since 1976, the U.S. economy is poised to grow at a higher average annual growth rate than the Chinese economy in 2022,” White House press secretary Karine Jean-Pierre tweeted.

“This is the result of President Biden’s economic strategy to make more in America and create good-paying jobs. This analysis underscores that the U.S. economy faces a range of global economic challenges from a position of strength and resilience.”

The report offered a glimmer of good news as the Federal Reserve attempts to rein in runaway inflation with higher interest rates. Biden admitted last month that he fears a recession in 2023.

Although the US unemployment rate was just 3.6% in April, the public views the economy negatively — and congressional Democrats may pay the price in the midterm elections in November.

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A new AP-NORC poll released Friday found that just 22% would describe the economy as “very good,” “somewhat good,” or “leaning toward good”. The remaining 78% describe the economy as “very poor,” “somewhat poor,” or “leaning toward poor.”

The same survey found that two-thirds of Americans (67%) disapprove of Biden’s handling of the economy, with 51% saying his policies have done more to hurt than help and 18% saying the opposite — while 30% say the president’s actions have made no difference at all.

The annual inflation rate was 8.3% in April after hitting a 40-year annual high of 8.5% in March. The high inflation rate outpaces average pay gains for workers.

Consumers shop for meat at a Safeway grocery store.
Americans are seeing some of the highest inflation rates in decades.
JIM WATSON/AFP via Getty Images

Biden generally blames inflation on supply chain bottlenecks caused by the pandemic as well as Russia’s invasion of Ukraine, which has increased energy and food prices. His critics blame anti-fossil fuel actions and high government spending.

Biden last year signed a $1.9 trillion stimulus bill that Democrats passed without revenue offsets and a $1.2 trillion bipartisan infrastructure bill, of which about $256 billion wasn’t paid for, according to the Congressional Budget Office.

A study released in late March by researchers at the Federal Reserve Bank of San Francisco said that in the final quarter of 2021, about 3 percentage points of inflation — or nearly half of it — may have been caused by government pandemic spending.

It’s unclear if the US actually will best China’s growth rate in 2022. Bloomberg noted that its own analysis for China’s economic growth was on the low end of professional predictions, with other estimates putting it around 4%.

US GDP growth in 2021 was 5.7% after it declined in 2020 by 3.4% in response to government-ordered business closures to slow the spread of COVID-19. China’s economic growth rate was 8.1% in 2021 and 2.3% in 2020.

Traders work on the trading floor at the New York Stock Exchange
Traders work on the floor at the New York Stock Exchange.
Andrew Kelly/REUTERS

Ahead of the pandemic, Chinese growth slowed in 2019 to a three-decade low due to then-President Donald Trump’s tariffs on a wide range of Chinese exports. Trump, seeking to forge a major trade deal, accused China’s government of improperly boosting industries to the disadvantage of US competitors.

The Biden administration is considering undoing some of Trump’s tariffs on Chinese goods to reduce consumer prices.

US-China relations remain tense due to human rights abuses in Xinjiang, the elimination of Hong Kong’s political economy, aggressive Chinese military maneuvers near Taiwan and the Chinese government’s refusal to cooperate with independent investigations of the origins of COVID-19, which the US intelligence community believes may have escaped from the Wuhan Institute of Virology.



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