WASHINGTON — White House officials are increasingly trying to combat the narrative that the United States is on the brink of a recession as they seek to get ahead of gloomy economic data due Thursday.
White House officials covered the waves over the past week, briefing journalists, posting a blog posts and urging surrogates to amplify their message as they seek to highlight strengths in the economy amid mounting Republican attacks.
“We’re not going to be in a recession,” Biden told reporters on Monday.
The White House acknowledged on Wednesday that inflation is putting pressure on consumers, but they pointed out strong job growth as a sign of hope for the economy. A senior administration official said one of their concerns was that fears of a recession would cause consumers to retreat, creating a “negative self-fulfilling prophecy,” prompting the White House to attempt to stave off recession-related concerns ahead of economic growth data due out on Thursday.
“I wouldn’t say that’s my biggest concern, but I think it explains why we think it’s important to get out these days before the GDP report and make sure people understand, with precision, that even if you had a negative number tomorrow, that we are not and have not been in a recession,” the official said.
Economic analysts expect data to be released on Thursday showing an overall decline in gross domestic product for the second consecutive quarter, one of several measures that have been used in the past to signal that the US economy is entering a recession. Earlier this week, data showed consumer confidence slipped last month to its lowest level in more than a year.
The Federal Reserve announced on Wednesday that it was raising its key rate by 0.75% to combat rising inflation, but Fed Chairman Jerome Powell said he did not think the United States would United were currently in a recession.
“I don’t think the United States is currently in a recession and the reason for that is that there are too many sectors of the economy that are doing too well,” he said. said.
For months, White House officials have worried about the impact the economy could have on Democrats’ chances of retaining control of Congress and trying to land a message that will resonate with voters, said a person close to the White House who asked not to be named when speaking about internal White House affairs.
The latest pullback around a recession is indicative of these broader concerns and efforts, the person said.
Indications that the United States could tip into a recession continue to weigh heavily on Democrats with just over three months to go until the midterm elections. Biden said he and other senior administration officials would increase travel before midterm to demonstrate that their plan to improve the economy was better than the alternative if Republicans took control of Congress l ‘next year.
“We need to remind people what life will be like for American families, especially if Republicans win back some of that power, and that comes into play by setting a contrast and making it clear where Democrats stand on the economy versus to that of Republicans,” said Adrienne Elrod, a Democratic communications strategist.
As part of the push from the White House this week, officials have sought to emphasize areas of the economy they believe will remain strong. On the contrary, the White House says the United States is transitioning to a slower-growing economy, pointing to low unemployment, consumer spending that “remains strong”, credit and mortgage defaults at low levels and household balance sheets that “remain largely in good shape,” Brian Deese, Biden’s chief economic adviser, said.
“All of the economic data is consistent with this type of transition, and it’s not consistent with a recession,” he said during a briefing with reporters on Tuesday.
Biden continued to get his economic message across even as he isolated himself with Covid this week, hosting virtual events touting the work his administration was doing to bring down gas prices and the importance to Congress of Pass Legislation to Strengthen Computer Chip Manufacturing in the United States.
“The employment rate is still one of the lowest we’ve had in history, it’s in the 3.6 zone, we still end up with people investing, hopefully we go from this rapid growth to steady growth,” he said. “We’ll see some come down. But I don’t think we’re going to, God willing, I don’t think we’re going to see a recession.
Treasury Secretary Janet Yellen made a similar case on NBC’s “Meet the Press” Sunday, saying “we’re not in a recession now” and that even if GDP growth declines, “we shouldn’t qualify that of recession”.
The technical classification of a recession is made by the National Bureau of Economic Research, a private, nonpartisan research group that reviews a range of data and typically makes a designation long after a recession begins. But a second quarter of slowing GDP growth will likely prompt Republicans to argue that the United States is already in a recession.
It’s a sentiment shared by business CEOs – 15% of whom said they thought their region was already in a recession and 60% said they expected one in their main region by the end of next year, according to a survey of more than 750 CEOs around the world surveyed in May by the Conference Board.
It’s a reality the White House has recognized and continues to try to resolve.
“But from the president’s perspective, and putting that technical question aside, the bigger question economically is whether middle-class workers and families have more room to manoeuvre,” said Deese. “They have more job opportunities, their salaries are steadily increasing, and they are able to afford the important things in their lives.”