As top White House officials reiterate that tackling high inflation remains President Joe Biden’s chief priority, his administration is debating strategies to bring prices down — and sending mixed signals about how, and how quickly, Biden may act on an issue that is top of mind for voters and weighing on his approval ratings.
The president said Monday he could make a decision as soon as this week on whether to support Congress instituting a pause on the federal gas tax of 18.4 cents per gallon, which experts have estimated could lower prices by approximately 14.72 cents per gallon.
Treasury Secretary Janet Yellen said on Sunday that the administration was open to considering such a move, citing the cost on consumers. As of Monday, the national average gas price was $4.98 per gallon.
“Gas prices have risen a great deal, and it’s clearly burdening households,” Yellen said during an appearance on “This Week” with George Stephanopoulos. “So [the president] stands ready to work with Congress and [gas tax holidays are] an idea that’s certainly worth considering.”
But Yellen’s counterpart at the Department of Energy seemingly disagreed with that notion in her own appearance Sunday.
“Part of the challenge with the gas tax, of course, is that it funds the roads,” Energy Secretary Jennifer Granholm said on CNN. “[W]e just did a big infrastructure bill to help fund the roads. So if we do — if we remove the gas tax — that takes away the funding that was just passed by Congress to be able to do that.”
“That’s one of the challenges. But I’m not saying that that’s off the table,” Granholm said.
A gas tax holiday would require approval from Congress, where Democrats hold a fragile majority. House Speaker Nancy Pelosi has previously spoken skeptically of the idea, saying it was possibly better “PR” than policy.
Biden told reporters on Monday that, as another relief measure, gas rebate cards were also under deliberation.
“That’s part of what we’re considering,” he said when asked. “That’s part of the whole operation.”
It’s unclear, however, how such rebate cards would work — whether they would be pre-loaded or provide rebates post-purchase.
A recession isn’t guaranteed: White House
Administration officials are united on one point: A recession is “not inevitable,” they have all said.
“There’s nothing inevitable about a recession,” Biden said Monday.
Yellen, Granholm and National Economic Council Director Brian Deese likewise all used variations of that language during their Sunday show appearances.
“There’s a lot of things about the economy right now that are unique,” Deese said. “Americans are spending less money on goods, they’re spending more money on services from companies … The housing market is recalibrating.”
Yellen acknowledged Sunday that inflation was “unacceptably high,” again blaming Russia’s invasion of Ukraine and long-term supply chain issues as contributors.
“These factors are unlikely to diminish immediately, but over time, I certainly expect inflation to come down,” she said.
Still, she noted, “Consumer spending remains very strong. There’s month-to-month volatility, but overall spending is strong.” And, she added, “Bank balances are high. It’s clear that most consumers, even lower-income households, continue to have buffer stocks of savings.”
With the Federal Reserve taking increasingly aggressive action to curb inflation — raising interest rates by three-quarters of a percentage point, the largest hike in nearly 30 years — Yellen said the goal was a delicate balancing act.
“[Fed] Chair [Jerome] Powell has said that his goal is to bring inflation down while maintaining a strong labor market. That’s going to take skill and luck, but I believe it’s possible,” she said Sunday.
As the administration insist there’s a way to avoid recession while reigning in inflation, Republican lawmakers are taking the opportunity to hammer Biden on higher prices — a key talking point for the GOP ahead of the November midterm elections.
“Bidenflation is costing average Americans an extra $460 a month,” Pennsylvania Rep. Lloyd Smucker tweeted on Monday.
Officials weigh more economic measures
Biden made clear Monday he has no plans to meet oil executives in person but is instead tasking top aides, like Granholm, with making his administration’s position clear.
In a letter last Wednesday, Biden called out seven oil refiners for earning record profits while oil supplies decrease. He asked the companies to increase production or risk facing White House intervention.
While the president did not specifically identify the tools he could use, Granholm hinted during a Wednesday CNN appearance that the Defense Production Act may be on the table.
In his letter, Biden also instructed his energy secretary to convene an emergency meeting with oil company executives.
Granholm will probe the companies to explain reductions in oil refining capacity, according to an ABC News report. Trade groups representing the producers contend that “U.S. refineries are running at 94 percent of capacity.”
The American Petroleum Institute also fired back at Biden’s letter, with its CEO and president arguing it was “the administration’s misguided policy agenda shifting away from domestic oil and natural gas [that] has compounded inflationary pressures and added headwinds to companies’ daily efforts to meet growing energy needs while reducing emissions.”
Separately, Yellen told federal lawmakers earlier this month that her department was reviewing Trump-era tariffs targeting China.
Economists in a March policy brief said that “eliminating the tariff would save US firms and households about $81 billion annually on direct purchases from China.”
When asked Saturday about his position on eliminating those tariffs, the president said, “We are still in the process of making up my mind.”
ABC News’ Justin Gomez contributed to this report.