Biden adviser Gene Sperling sees U.S. hope and resilience despite shrinking economy
MARY LOUISE KELLY, HOST:
Let's shift from climate change to the broader economy and another matter that's front and center for the country. Are we in a recession? Also, does it matter, by which I mean, does it matter whether technically the country is in a recession or not when people are definitively feeling the pinch from inflation and everything from food to transportation to rent costing more? Let's bring in senior adviser to President Biden Gene Sperling. He joins me now from the White House. Mr. Sperling, welcome back to ALL THINGS CONSIDERED.
GENE SPERLING: Well, thanks for having me.
KELLY: All right. Help us parse today's news. As you know, new GDP numbers are out today. The U.S. economy shrank in the last three months. This is the second consecutive quarter it has shrunk, which is often considered a recession. So is that where we are?
SPERLING: No, it's definitely not where we are. What we saw today was that the red-hot growth we saw in 2021 is cooling, as you'd expect with the actions by the Federal Reserve. But what we've also seen these last few months is very solid job growth, very low unemployment and a consumer that's still spending and still has probably a little more in their bank account than they did a year ago. And so, yes, we're an economy that is being affected by the global challenges on inflation, but we're also seeing the signs of resilience, of jobs still being created, of unemployment that's still low and, finally, a little relief with gas prices having fallen.
KELLY: So you're pointing to job growth, which is obviously a factor. Republicans - Mitch McConnell, for example, top Republican in the Senate, says Democrats are trying to redefine what a recession is. He says Democrats should focus on improving the economy for working families instead of - and I'll quote him - "telling people things aren't as bad as they look or feel." Does he have a point?
SPERLING: Well, I will tell you what I've always said. It's that every person is the world's greatest expert of how they're doing. If a person is hurting, even if they have a job, even if they've gotten a raise, if they're hurting because of higher prices at the gas pump or at the grocery line, they're the authority. And, yes, there's a lot of people in that situation. But the question being asked...
KELLY: Or the housing market. Forgive me for jumping in. Just...
KELLY: But we're speaking in the abstract. And I want to make it specific in the time that we have. We had on the program yesterday a number of Americans trying to buy a house and saying, you know, prices are going up. Interest rates are going up. It's getting harder. I want to let you listen to one woman we spoke to and respond. This is Mackenzie Bathgate of Lansdale, Pa.
MACKENZIE BATHGATE: We just want to have a family and a yard and be able to have a beer on our deck at the end of the day. And I feel like the American dream isn't attainable anymore.
KELLY: The American dream isn't attainable anymore. What do you say to Miss Bathgate?
SPERLING: Well, I think the issue with housing prices is always complex because when they go up, it helps create more equity and security for those who own homes. And it can make it difficult for those trying to be a first-time homeowner. But I do want to say that Federal Reserve Chairman Powell himself said yesterday that what we're seeing right now, because of the strong job growth, is inconsistent with any definition of a recession.
KELLY: Chairman Powell also nodded to how tricky it is to try to calm the economy - the red-hot economy, as you call it - without sending it into a tailspin. How do you think about navigating that?
SPERLING: No, I mean, that's the goal. Economists call it a soft landing, but what that really means is you want to be able to make that transition to a more stable growth with lower prices without having a downturn. And you certainly don't want people to become more negative than they should be. So the fact is that many of the things in the American Rescue Plan mean that state and local governments are still doing pretty well.
KELLY: Say the economy were to dip into recession, or say we avoid one. Who's responsible? It's - the buck stops. Where does the buck stop? Question - is this on the Fed? Is this on Congress? Ultimately, is this President Biden's economy?
SPERLING: Look. It's a tough time for governments everywhere to be dealing with the lingering impacts of pandemics, the aftershock. But all of us have the responsibility to do everything we can to help working families with the No. 1 issue that's hurting them, which is higher prices due to this global inflation.
KELLY: Gene Sperling. He's senior adviser to President Biden on the line with us there from the White House. Mr. Sperling, thank you.
SPERLING: Thank you so much. Transcript provided by NPR, Copyright NPR.