DURING PORT VISIT, BIDEN CASTS INFLATION AS GLOBAL PROBLEM
President notes his efforts to speed up delivery of goods
President Joe Biden on Friday defended his administration’s efforts to deal with inflation, just hours after a new report showed a surprise spike in prices that puts new pressure on the White House to ease the burden on consumers.
Biden used the Port of Los Angeles as a backdrop to highlight his fight against inf lation, delivering a speech about how his team has tried to speed up the delivery of goods disrupted by the coronavirus pandemic.
“The job market is the strongest it’s been since World War II, notwithstanding inflation,” Biden said, standing on the battleship Iowa, a decommissioned warship that has been turned into a museum.
With shipping containers piled up behind him, Biden emphasized that his administration had taken action last year to reduce congestion at ports, allowing 97 percent of all packages to be delivered on time during the holiday shopping season.
But six months later, serious problems remain and persistent inflation has become a major political liability for Biden.
The war in Ukraine has disrupted flows of food, fuel and minerals, adding to pandemic-related shortages and pushing inflation to multi-decade highs. Data released Friday morning showed inflation picking up again, rising 1 percent from the previous month. Compared with one year ago, consumer prices rose 8.6 percent, the largest annual increase since 1981.
While some clogs in the supply chain look to be clearing, analysts say that trend may yet stall — or even reverse — in the months to come, as retailers enter a busier fall season and dockworkers on the West Coast renegotiate a labor contract that could lead to work slowdowns or a strike.
Biden said he understands that Americans are anxious.
“They are anxious for good reason,” he said. But he stressed that inflation is largely the result of increases in the price of gasoline and food, and he blamed the price hikes in those goods on Russia’s invasion of Ukraine.
Biden argued that large price increases in the United States were part of a global problem with inflation and that Americans were in better shape than their counterparts elsewhere because of a strong jobs market and a declining budget deficit.
He lashed out at nine shipping companies that he said had used the global economic situation to increase prices by 1,000 percent, artificially adding to the cost of goods around the world. He did not name the companies.
He called on Congress to crack down on shipping companies that raise prices.
“The rip-off is over,” he said.
Biden is correct that soaring inflation is a global problem. In a note to clients Friday, Deutsche Bank Research said the U.S. ranked 48th for its inflation rate on a list of 111 countries, just above the middle of the pack.
But that is little comfort to U.S. households struggling with rising costs.
Analysts say the U.S. logistics industry is heading into its busier fall season, when retailers bring in products for back-to-school shopping and the holidays. Chinese exports are on the rise as an extended coronavirus lockdown lifts in Shanghai.
And, most crucially, dockworkers on the West Coast are renegotiating a labor contract with port terminal operators that expires at the end of this month. If they fail to reach an agreement, West Coast ports may see slowdowns or shutdowns that would delay deliveries and add to supply chain gridlock.
Over the past two decades, labor negotiations led to at least three such slowdowns or stoppages that resulted in delays. In recent weeks, some companies that typically ship into the West Coast have begun routing some goods to the East or Gulf Coasts to try to avoid any log jams.