WASHINGTON (AP) – President Joe Biden said Thursday that the Federal Reserve’s decision to cut interest rates was an “important signal” that inflation has slowed, after calling Donald Trump’s economic policies a failure in the past and certain to “fail again” if revived.
“Cutting interest rates is not a victory announcement,” Biden said at the Economic Club of Washington, DC. “It’s a sign of progress, a sign that we’ve entered a new phase in our economy and recovery.”
The Democratic president stressed there was more work to be done, but he used his speech to burnish his economic legacy even as he criticized Trump, his Republican predecessor, who is running for a second term.
“The trickle-down economics failed,” Biden said. “He promises to trickle down economics again. It fails again.”
Biden said Trump wants to extend tax cuts that disproportionately benefit the wealthy and cost an estimated $5 trillion, and introduce tariffs that could raise prices by nearly $4,000 per family, in what Biden described as a “new sales tax.”
A spokesperson for Trump’s campaign did not immediately respond to a request for comment. But Trump has routinely blasted Biden and Vice President Kamala Harris, the Democratic nominee this year, for higher costs.
“People can’t go out and buy cereal or bacon or eggs or anything else,” he said during a debate last week. “The people of our country are absolutely dying from what they’ve done. They’ve destroyed the economy.”
Biden disputed Trump’s claims of support for workers, saying “give me a break.” His administration created more manufacturing jobs and accelerated factory construction, and it narrowed the trade deficit with China.
The coronavirus outbreak undermined Trump’s economic record, and Biden accused him of distorting the country’s response.
“His failure to manage the pandemic led to the deaths of hundreds of thousands of Americans,” he said.
Biden tried to show economic progress because of the inflation that spread around the world as the pandemic receded and supply chain problems multiplied.
He hoped that the interest rate cut would make it more affordable for Americans to buy houses and cars.
“I think it’s important for the country to recognize this progress,” he said. “Because if we don’t, our progress will be held back by the fear of the negative mindset that has dominated our economic outlook since the pandemic began.”
He said companies should see “the huge opportunity for our advantage right now” by investing and expanding.
Biden defended the independence of the US Federal Reserve, which Trump could threaten if he is elected for a second term. Trump publicly pressured the central bank to lower its key interest rates during his presidency, a departure from past practices.
“It would do tremendous damage to our economy if that independence is ever lost,” Biden said.
In his speech, Biden inaccurately said he had never met Federal Reserve Chairman Jerome Powell while he was president.
Jared Bernstein, chairman of the White House Council of Economic Advisers, said at a later briefing that Biden intended to say he had never discussed interest rates with Powell.
“That’s what he meant,” Bernstein said.
