Transcript: Brian Deese on “Face the Nation”

The next is a transcript of an interview with Brian Deese, White Home director of the Nationwide Financial Council that’s set to air Sunday, June 19, 2022, on “Face the Nation.”


MARGARET BRENNAN: Welcome again to Face the Nation. We’re joined now by Brian Deese, he’s the director of President Biden’s Nationwide Financial Council. Good morning and welcome to the printed.

DIRECTOR OF THE NATIONAL ECONOMIC COUNCIL BRIAN DEESE: Thanks for having me.

MARGARET BRENNAN:  You could have an unbelievable problem in your palms. Sure, the jobless fee is low. However wage development, not holding tempo with inflation. What do you say to People who’re pondering that they may want a second job to pay their payments? 

DEESE: Effectively, it’s an unsure second and we face actual challenges, world challenges. Inflation is a world problem 9% within the UK over 8% in Europe, however we even have actual strengths right here at house. And so what I’d say is, we have to navigate by means of this transition in a approach that will get us to secure development with out giving up the entire unbelievable financial features that we have made. You talked about the jobless fee at 3.6%. We have additionally seen family steadiness sheets strengthened over the course of this era. A examine got here out this previous week that confirmed that the standard household has $10,000 in further financial savings. Due to these strengths. We have seen issues like mortgage delinquencies, the bottom in 15 years, bank card delinquencies the bottom in 30 years. So we have now actual strengths on this economic system. What we have to do now could be do what the President has mentioned, put our high precedence on bringing costs down and achieve this in a approach the place we do not have to surrender all of these financial features. 

MARGARET BRENNAN: However sure, there are folks sitting on money, that is really a part of the issue, proper a part of the problem, however for these people who’re struggling to pay their payments are you able to stage with them as a result of the Congressional Price range Workplace predicts that top inflation will persist till 2024. The Treasury Secretary has mentioned it can keep increased than the initially forecast. 4.7%. When does it come down? How a lot time are you speaking about? 

DEESE: Effectively, costs are unacceptably excessive proper now. And that is why the President has mentioned we have to make this our high financial focus and do every thing that we are able to to get them down. Most impartial forecasters, the blue chip, the Federal Reserve, as you mentioned, see inflation starting to average over the course of this 12 months. However, our focus is on what are the steps, what are the insurance policies that we are able to take and the only most impactful factor that we might do proper now could be to work with Congress to go laws that might decrease the prices of issues that households are dealing with proper now–

MARGARET BRENNAN: –Like what now?

DEESE: –like prescribed drugs, we might decrease the price of prescribed drugs by permitting Medicare to barter higher costs that might really decrease federal spending, and it might decrease the associated fee that folks pay. 

MARGARET BRENNAN: The President mentioned this week in a uncommon interview that he really has the votes to do it. The place’s the deal? When’s the vote? 

DEESE: Effectively, decreasing prescription drug prices is one piece. Reducing utility prices by offering tax incentives for power is one other piece, however equally essential, decreasing the federal deficit by enacting lengthy overdue tax reform. If we are able to do a package deal like that we are able to transfer ahead within the close to future. It won’t solely assist in decreasing costs, however it can ship a sign to the markets and the worldwide economic system that the US is admittedly lethal critical about taking over this inflation–

MARGARET BRENNAN:  –climbing taxes is not going to alter the worth of milk. When and the way are you really placing ahead this package deal? 

DEESE: The package deal has been debated it has been labored by means of–

MARGARET BRENNAN: –It is failed again when Construct Again Higher’s model of it. So if inflation is the primary precedence proper now, when are you scheduling a vote to do the belongings you simply laid out? 

DEESE: We’re working very carefully with congressional management with Senate management on that. Senator Schumer is working along with his caucus to attempt to get a remaining package deal in place and we’re hopeful that we’ll see progress on that within the coming weeks. 

MARGARET BRENNAN: So within the coming weeks, you assume you will get this carried out on a celebration line vote earlier than September? 

DEESE: We’re hopeful that we are able to move- we are able to transfer ahead on that. We’re hopeful we are able to transfer ahead on that and different priorities in Congress as nicely. There is a invoice on semiconductors which I do know you have talked about on this program, laptop chips. The shortage of inexpensive and out there laptop chips has pushed up costs throughout the economic system, together with issues like cars. There is a invoice within the Senate and the Home, bipartisan invoice that we might get carried out. We’re hopeful that we are able to transfer that as nicely earlier than the August recess, that would offer some actual reduction to the economic system as nicely.

MARGARET BRENNAN: And also you want that earlier than the midterms. This has an enormous political price to it. 

DEESE: Effectively, our focus and my focus is on the financial influence that we completely perceive and when individuals are pulling as much as the gasoline pump at present costs are too excessive. That is why we have made this the precedence that we have now, and at the same time as Congress is appearing it is why that we’re appearing on our personal. The President has taken simply over the past month steps to decrease the price of housing, decrease the price of web, decrease the price of power for American households. And we’re gonna hold doing that at the same time as we work with Congress on their precedence. 

MARGARET BRENNAN: Regardless of all of what you laid out, and I do know the President mentioned, recession is just not inevitable. It appears more and more possible that the Convention Board put out their survey this week, it reveals eight out of 10 world CEOs now count on a recession inside the subsequent 12 to 18 months. So what powers does the President should cease that form of contraction?

DEESE: Effectively, I believe what- the place we’re within the economic system proper now could be in a transition and I spoke to CEOs this- over the course of the previous week from sectors throughout the economic system, and so they’re determining the right way to navigate this transition. A few of that is precisely what we have to see–

MARGARET BRENNAN: –they’re planning round a recession. 

DEESE: Effectively, they’re planning round transitions in our economic system, individuals are shopping for much less items, spending time at house, they’re spending extra on providers that creates some actual challenges for some corporations and a few CEOs. It creates alternatives for others. So that they’re planning round this transition. What I’d say is that not solely is the recession not inevitable, however I believe that lots of people are underestimating these strengths and the resilience of the American economic system. Now we have been by means of delta and omicron. We have had a struggle in Europe and the entire impacts that that has had and thru it, the American economic system has remained resilient. What we wish to give attention to now could be taking each step we are able to to proceed that progress. In fact, there are dangers. In fact there are challenges, however there are additionally issues that we are able to do proper now on our personal working with Congress, that is why we’re placing such a precedence on this. 

MARGARET BRENNAN: However should not you stage with the American public and simply say we’re in uncharted waters. I imply, even the Federal Reserve Chair mentioned this week there are issues past his management. He cannot management the worth of gasoline, he cannot management the struggle in Europe. He cannot management COVID. He has a restricted set of instruments and so do you. Is the President powerless right here? 

DEESE: Completely not. Look, we face unprecedented world circumstances, a world pandemic and a struggle in Europe, that affects the worldwide economic system however on the identical time, we have now a technique that may make a distinction. That laws that we had been speaking about decreasing the price of prescribed drugs decreasing the price of power, decreasing the federal deficit, that might make an actual distinction. 

MARGARET BRENNAN: and you’ve got all 50 Democrats on board for that? Since you did not final time you tried elements of this invoice.

DEESE: look, nothing is- nothing is completed till it is carried out. We’re hopeful. We’re working laborious. We acquired our head down and we’ll attempt to get one thing carried out. 

MARGARET BRENNAN: So quite a few economists I wish to put up a chart of inflation right here for our viewers to see, measured by the Shopper Value Index. So from the start of the pandemic by means of now, as you’ll be able to see, the tick up started 12 months earlier than the struggle in Ukraine started. Numerous economists together with on the San Francisco Fed have mentioned that the large fiscal spending that went underway, the 6 trillion in two years did add to that, together with, as you’ll be able to see, proper on there, the two trillion that the Biden administration pushed by means of within the spring of 2021. So when folks take a look at that, and so they say, nicely, the White Home instructed us why that inflation can be transitory. The White Home instructed us we might undergo with this type of spending, we might be effective. Even when Democrats inside your personal occasion had been warning this is able to add to inflation. How do you win credibility right here to the general public and say, this time we’re not mistaken?

DEESE: Effectively, you simply should look around the globe at present to acknowledge that the 2 principal drivers of inflation are the pandemic and Putin. We’re seeing this in every single place. It’s a world phenomenon, as I discussed within the UK, inflation’s hit 9%.

MARGARET BRENNAN:  –proper, however the level is these are the issues you’ll be able to’t management.

DEESE: – In Europe it is over –

MARGARET BRENNAN: –I am speaking concerning the issues you’ll be able to.

DEESE: Completely.

MARGARET BRENNAN: So, how do you win that credibility again? 

DEESE: Effectively, if we take a look at the issues that we are able to management, we win credibility. By taking motion. This President is appearing. This president galvanized the worldwide neighborhood to do a historic launch of oil from the Strategic Petroleum Reserve one million barrels a day. Main oil market analysts this week mentioned that motion was single handedly chargeable for holding oil costs from going up even additional–

MARGARET BRENNAN: –Proper, brief time period.

DEESE: –we’re going to take motion. We will prioritize, we’ll clarify that tackling inflation is our high financial precedence. And we’ll encourage Congress to take motion as nicely. The best way we construct credibility is by demonstrating outcomes. 

MARGARET BRENNAN: One of many issues that you simply do have management over on the government is the strategy on tariffs. Treasury Secretary Yellen instructed me again in November, she acknowledged that the Trump period China tariffs do add to inflation domestically right here. President was requested about this yesterday and mentioned, we’re nonetheless within the course of of creating up my thoughts. If inflation is the primary precedence. Why are you dragging out this resolution? 

DEESE: Effectively, I will let the President’s phrases converse for himself. We’re wanting carefully at and I anticipate the president can have extra to say on that situation within the coming weeks. However simply to be very clear over the course of the final couple of months. This is a matter about our provide chains and about getting items to the US in a approach that’s efficient and low-cost. And the President has been extremely targeted on that-MARGARET BRENNAN: –Do you- do you prefer it?  

DEESE: –Simply this previous week- simply this previous week- simply I am gonna let- I am gonna let that course of unfold them and let the President converse to his resolution on that entrance for simply this–

MARGARET BRENNAN: How a lot do you assume it provides to inflation? 

DEESE: Effectively, I simply wish to be clear, that is a couple of broader situation. That is about are we getting the products and providers that we’d like in the US in a approach that’s good for our economic system, good for American jobs, and in addition lowers costs. There are loads of methods at that concentrate on. Simply this previous week, the President signed into regulation a bipartisan piece of laws to crack down on delivery charges. Delivery charges add to the price of items that come to the US over their 1,000% value will increase that we have seen. I’ve talked to CEOs simply this previous week, who mentioned they needed to go these prices instantly on to shoppers by signing that invoice into regulation. We’re gonna assist to cut back these costs, paid. And which means decreasing costs on the cabinets for shoppers. So there’s loads of methods to- to at this and we’re making an attempt to give attention to all of them. 

MARGARET BRENNAN: Effectively, we’ll proceed to trace it. Thanks very a lot, Brian Deese, for coming in. 

DEESE: Thanks.

MARGARET BRENNAN: And we’ll be proper again.

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