Fears for Democrats’ midterm hopes as US inflation hits 40-year high – live | US news

Brian Deese, the director of the White House National Economic Council, argued that provisions in Joe Biden’s Build Back Better agenda would help to lower families’ bills.

For example, policies to cut the cost of childcare and enact clean energy tax credits would help average Americans’ budgets, Deese told MSNBC’s Stephanie Ruhle.

“These are practical ways to provide people relief. We could do so without increasing the deficit and then as a result not adding to inflationary pressures,” Deese said.

Acknowledging the severe impact of rising prices, Deese added, “This inflation challenge is real. We need to address it. We need to provide people relief, and we need Congress to work on that right now.”

Joe Biden acknowledged that rising prices in the US are having a significant impact on families’ budgets, even as the American economy more broadly continues to recover from the effect of the coronavirus pandemic.

“On higher prices, we have been using every tool at our disposal, and while today is a reminder that Americans’ budgets are being stretched in ways that create real stress at the kitchen table, there are also signs that we will make it through this challenge,” Biden said in a new statement.

The president noted that many economists believe inflation will ease substantially by the end of 2022, as some pandemic-related bottlenecks ease and the Federal Reserve enacts interest rate hikes.

Biden also pointed to the data on wage growth and declining unemployment claims to argue that Americans are still benefitting from the economic recovery.

“That’s a sign of the real progress we’ve made in getting Americans back to work over the last year,” Biden said. “My administration will continue to be all hands on deck to win this fight.”

Joe Biden will visit Culpeper, Virginia, today to discuss his administration’s “work to lower health care costs, including prescription drug costs, for American families,” according to his schedule.

The president may stop to take questions from reporters as he leaves the White House, giving him an opportunity to address the latest report on inflation.

Biden has previously acknowledged how rising prices are hurting American families’ budgets and tempering the impact of recent wage increases.

“Average people are getting clobbered by the cost of everything today,” Biden said last Friday. “Gas prices at the pump are up. We’re working to bring them down, but they’re up. Food prices are up. We’re working to bring them down as well.”

The president argued his Build Back Better Act, which has stalled in the Senate, would help give families more financial breathing room by lowering the cost of childcare and healthcare.

But given Joe Manchin’s alarm over the latest inflation report, it’s unclear what version of the Build Back Better Act, if any, can make it through the Senate.

Joe Manchin, the Democratic senator who killed the Build Back Better Act because of his opposition to the cost of the spending package, argued the latest inflation report sent an ominous message to lawmakers.

“Inflation taxes are draining the hard-earned wages of every American, and it’s causing real and severe economic pain that can no longer be ignored,” Manchin said in a new statement.

“As inflation and our $30 trillion in national debt continue a historic climb, only in Washington, DC do people seem to think that spending trillions more of taxpayers’ money will cure our problems, let alone inflation.”

Although Manchin does not mention the Build Back Better Act specifically in the statement, he has previously linked his opposition to the $1.75tn bill to concerns over the growing federal debt and its impact on rising prices.

“Now, more than ever, we must remember it is not our money, it’s the American people’s money. It is not our economy, it’s their economy,” Manchin said.

“We all have a responsibly to do all that is possible to roll back inflation and manage our debts because the longer we or the Federal Reserve waits to act, the more economic pain will be caused.”

The statement will likely cause some concern among Democratic leaders, who are trying to bring Manchin back to the negotiating table to pass a new version of the Build Back Better Act.

Greetings from Washington, live blog readers.

The Bureau of Labor Statistics reported this morning that US prices increased by 7.5% in January from a year ago, marking the country’s highest level of inflation in 40 years.

The Guardian’s Dominic Rushe reports:

The rise in the consumer price index (CPI) survey – which measures the costs of a wide variety of goods – was the largest since February 1982. CPI rose 0.6% from December, higher than expected.

Inflation in America has been driven higher by soaring demand and a lack of supply caused by Covid-19’s global impact on trade.

Price rises for food, electricity, and shelter were the largest contributors to the increase. The food index rose 0.9% in January following a 0.5% increase in December. The energy index also increased 0.9% over the month.

Democrats fear that Americans’ frustration with higher prices could weaken their chances in the midterm elections this November, potentially giving Republicans the opportunity to take control of the House and the Senate.

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