CNN host Jake Tapper suggested Thursday that the White House is in “denial and out of touch” with Americans regarding the state of the economy.
Tapper pressed senior adviser to President Joe Biden, Gene Sperling, on the president denying the nation is in a recession. The Bureau of Economic Analysis (BEA) released a report Thursday finding the GDP declined by 0.9% in the second consecutive quarter of 2022.
Economist Julius Shiskin declared in 1974 that a negative GDP in two consecutive quarters defines a recession. Although this definition is traditionally used, it is not the official indication that a country is in a recession.
“Doesn’t this semantic debate risk making the White House seem as if you’re in denial and out of touch with Americans who are really struggling out there?” Tapper asked.
“Not at all, Jake,” Sperling said. “Let’s acknowledge that every single family is the world’s leading expert on how they themselves are doing, and we totally appreciate the degree that so many Americans feel pinched and squeezed by the higher prices at the gas pump — even with gas prices down $0.75 now — squeezed at the grocery line by the impacts of global inflation on the U.S. We feel that, we’re not denying that.”
The adviser argued the country witnessed historic job growth in 2021 and touted the 2.7 million jobs and 3% growth in the private sector within the first half of 2022, which he claimed is inconsistent with the “historical definition” of a recession.
“But it’s been two quarters in a row of negative GDP growth,” Tapper said. “That is an ugly fact, and traditionally that has been the colloquial way a recession has been defined.” (RELATED: Yellen Says US Is In ‘New Phase’ Of Recovery After Report Shows Decline In GDP)
“I’m just reminding people that those six months, that people would claim were in recession, are the same six months that we grew 2.7 million jobs and that only last year have we ever had that many, and the second closest was 1946, right after World War II.”
Tapper then turned to the Inflation Reduction Act of 2022 that intends to impose a 15% minimum tax on large corporations. The CNN host asked how this bill benefits Americans concerned about high prices.
Sperling said people “should be very happy” with the legislation because it aims to lower prescription drug costs, premiums for 13 million people on healthcare, energy costs, and the deficit by $300 billion.
“By simply making the most well-off corporations pay some minimal fair share, we’re able to use those funds to provide these benefits, these incentives for job growth here, and production in the United States. At the same time, we’re paying for them and actually bringing down the deficit and therefore tamping down on inflation.”
The U.S. Chamber of Commerce warned the bill will “discourage investment and undermine economic growth,” Tapper pointed out. The economic adviser argued the bill is only imposing a minimum tax on companies making $1 billion profits.
President Joe Biden responded to the BEA’s report saying the economy is on the “right path” due to growing consumer spending, low unemployment and increasing job growth. In a separate statement, he cited the passage of the CHIP bill and the introduction of the Inflation Reduction Act providing billions in tax credits and job creating incentives.
“That doesn’t sound like a recession to me,” he said.