Boasting that government policies can make a difference to improve the economy, President Joe Biden on Thursday went too far in taking credit for job growth since he took office.
He also made a dubious suggestion that offenses are behind higher petrol prices – something that his administration will seek to rectify. But analysts say there is little evidence that this is the case.
A look at his claims and facts:
BIDEN: “When I was sworn in as president, the nation struggled to pull itself out of the worst economic crisis since the Great Depression. Job growth was anemic, with just over 60,000 new jobs a month in the three months before I was sworn in. So “We went to work. We passed the US rescue plan back in March. And it worked; it still works. Over the last three months, we’ve created an average of 750,000 new jobs a month.”
FACTS: The bite takes more credit for its plan than it deserves.
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The robust employment since its inauguration largely reflects the reopening of the U.S. economy after a huge winter wave of coronavirus infections began to peak in January. Widespread vaccinations, which peaked at three million a day in the spring, played a key role in enabling restaurants, bars and entertainment venues to reopen and re-employ. Planes filled up, just like hotels.
The bid’s $ 1.9 trillion financial rescue package, approved by Congress in March, played an important role. By providing a third round of stimulus checks and extending an expanded unemployment benefit program during the first week of September, Biden’s plan beat up spending and finances by putting more money in Americans’ pockets.
But employment slowed sharply in August to a gain of just 235,000 jobs, as the delta variant drove cases counting higher, underscoring the virus’ ongoing grip on the economy.
BIDEN: “We are also looking for the bad players and pandemic profiteers in our economy. There is a lot of evidence that gas prices should fall, but they are not. We are looking into that.”
FACTS: There are actually only a few signs that something terrible is behind the higher petrol prices that Biden is proposing.
In fact, petrol prices usually fall after Labor Day after the summer’s highest driving season. Although it has not yet happened this year, analysts say other factors besides malfeasence appear to be at play. U.S. gas and oil prices, for example, have been affected by a hurricane that temporarily shut down most of Gulf of Mexico oil production, several large refineries and a major fuel pipeline to the east coast.
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The national average price for a gallon of gasoline is $ 3.19, according to the AAA car club. It is unchanged from a month ago, however, a dollar up from this time last year.
Gasoline prices usually track oil prices, and the price of benchmark U.S. crude oil is back close to highs in early July after falling in August.
Jeffery Born, an energy market expert at Northeastern University, said current gas prices are in part a result of production and refining capacity that was beaten offline by Hurricane Ida and other factors — even the shortage of tank drivers.
“In short, I think we have problems with the supply chain,” Born said. “I’m sure Joe wants prices to fall – so do you and I. I also want to be 20 kilos lighter tomorrow.”
Phil Flynn, an energy analyst at Price Futures Group and a critic of Biden’s energy policy, said prices reflect demand that came back stronger than expected from the pandemic and lower US oil production, exacerbated by events such as the hurricane.
“I see no profit or bad actors,” Flynn said.
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Tom Kloza, chief analyst at consulting firm Oil Price Information Service, said Hurricane Ida and sustained effects on production and refining are causing summer-like prices to “linger longer,” especially east of the Rockies. He predicted that pump prices will soon ease in the states of West, Southwest and Rocky Mountain.
Energy economist Philip Verleger said gasoline prices are being pushed up by U.S. independent producers and OPEC members, which are limiting their oil production, the cost of mixing ethanol into gasoline and lower gasoline stocks.
There are already some signs that gasoline prices in retail have peaked, and the Energy Information Administration reported last week that gasoline prices are likely to fall in the coming months. It predicts prices would average $ 3.14 per gallon in September before falling to $ 2.91 in the last three months of the year as winter months decline and refining come online again after being damaged by the hurricane.
Biden joins a rich tradition of presidents expressing frustration over high gasoline prices. In 2019, then-President Donald Trump tweeted on OPEC, the Saudi-led oil cartel.
“Oil prices are getting too high,” Trump tweeted. “OPEC, relax and take it easy. The world cannot take a price increase – fragile!”
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Biden himself tried this approach last month when he urged OPEC members to increase oil production, as well as growing concerns that higher energy prices could slow the recovery of the US economy following the COVID-19 pandemic.
“Production cuts made during the pandemic should be reversed when the global economy recovers to lower consumer prices,” Biden said at the time.