United States Secretary of Treasury W. Michael Blumenthal in Washington, D.C., June 7, 1978.
AP Photo/CWH
- A former Carter-era official is calling on Biden to abandon any effort to revive Build Back Better.
- W. Michael Blumenthal told the Times that the president should take “painful steps” to combat inflation.
- Democrats aim to revive a smaller version of the bill in the coming weeks.
A Carter administration official is offering President Joe Biden a piece of advice to combat inflation: He should abandon what’s left of his economic agenda and focus on reining in the national debt instead to bring down rising prices.
“Inflation fighting comes first,” W. Michael Blumenthal, a former treasury secretary for President Jimmy Carter in the late 1970s, told The New York Times in an interview published Tuesday. “He has to show the recognition to the public that inflation has lasting deleterious effects on the economy and that by trying to take half measures now, you merely prolong the pain of these effects.”
“President Biden faces this dilemma, and it’s certainly my hope that he will choose clearly, choose decisively and be very clear not only about the fact that he recognizes that inflation has to be dealt with, but that he is really willing to support painful steps to do that,” Blumenthal said.
It comes as Democrats struggle to combat inflation, now at its highest level in four decades. Carter’s term — which lasted from 1976 to 1980 — was marked by a similar spike in gas prices stemming from the Arab oil embargo and the Iranian revolution.
Today’s surge in energy prices are the result of Western sanctions knocking out Russian oil from global markets, coupled with huge demand outstripping the available supply of oil. Biden and Democrats are blaming Russian President Vladimir Putin for driving up inflation, along with oil companies that are currently restraining domestic production.
Democrats have pitched a range of measures aimed at providing financial relief, but they’re dead on arrival in Congress because of internal splits and Republican resistance. Biden endorsed a proposal to suspend federal gas taxes last month, but Democratic leaders did not commit to it.
The main linchpin of the Democratic agenda remains a scaled-back version of the party’s Build Back Better legislation from last year that seems likely to center on clean energy tax credits and cutting the federal deficit. Democrats are hoping to woo Sen. Joe Manchin of West Virginia, a holdout, into backing a smaller package by the start of August. Republicans are staunchly opposed to it.
“They’re still playing around with BBB,” Senate Minority Leader Mitch McConnell said in Paducah, Kentucky on Tuesday, referring to the stalled Build Back Better plan carrying the bulk of the Democratic agenda. “If they bring that back, it will only make all of this considerably worse.”
An analysis from the Penn Wharton Budget Model at the University of Pennsylvania from late last year indicated the House-approved bill — which Manchin killed in December citing increasing inflation — wouldn’t significantly worsen rising prices.
