On Tuesday’s “CNN Newsroom,” Deputy Secretary of the Treasury Wally Adeyemo responded to questions on whether the Biden administration should have listened to warnings on inflation from people like economist Larry Summers by stating that no one could have seen the war in Ukraine, there are global supply chain problems, and “the most important lesson that we’ve learned here is that we’ve got to do exactly what we’ve done since the beginning of this administration, which is everything we can to deal with the challenges the American people face.”
Co-host Poppy Harlow listed examples of officials downplaying the risks of inflation and warnings from people like Larry Summers and asked, “Should more people in the Biden administration have been listening to Larry Summers?”
Adeyemo responded, “So, Poppy, what I can tell you is that the president and Secretary Yellen and the entire administration is focused as our top priority on lowering costs today. No one could have predicted the war that Russia launched on Ukraine and the impact that’s having on prices today, from global energy to food prices. The supply chain shock that’s been created by COVID isn’t only something that’s happened here in the United States. But it’s happened around the world, and the president, in his op-ed, laid out three things that we’re going to do to address it: One is give the Fed the room it needs to take the actions it needs to. Two is take actions like [releasing] energy from the Strategic Petroleum Reserve to bring down the costs of things like oil. And three is bring down our debts and deficits over time in order to ensure that America both has the resources to pay for the things that we need, but also to help deal with the high costs in our economy.”
Harlow then asked, “I hear you, and we just talked about the SPR release. That didn’t bring prices down. And now the fact that you’ve got these E.U. sanctions and E.U. cutback — way cutting back from Russian oil imports, that will likely drive oil prices even higher, I guess I’m trying to ask, is there a lesson learned here? Should ears have been more open to critics and folks like Larry Summers?”
Adeyemo answered, “So, Poppy, I think the most important lesson that we’ve learned here is that we’ve got to do exactly what we’ve done since the beginning of this administration, which is everything we can to deal with the challenges the American people face. Think about where we started, when the president came into office, 20 million Americans were [unemployed]. Today, we have historic job growth. We also didn’t have many Americans who were vaccinated, and today, millions of Americans are vaccinated. So, what the president’s going to do going forward, is use that same resolve and deal with — to deal with inflation and to make sure that we address these challenges going forward. And we’re going to do everything in the administration we can and we’re going to give the room — the Fed the room it needs to make sure that it brings down inflation over time.”
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