Biden says rising wages are an indication that his financial agenda is working
WASHINGTON – After weeks of defending his economic policies against critics blaming them for overheating the economy, President Joe Biden went on the offensive Thursday, arguing that rising wages are a sign that his agenda is adding to the fortunes of working Americans.
“The bottom line is, the Biden economic plan is working,” said the president in a speech at Cuyahoga Community College in Cleveland, Ohio. “We have created record jobs, we are seeing record economic growth, we are creating a new paradigm. One that rewards the work – the working people in this nation, not just the front runners.”
Republicans and corporate groups claim that improved federal unemployment benefits in Biden’s American Rescue Plan, its domestic benefit, are responsible for a “labor shortage” that has forced companies like McDonald’s and Bank of America to raise their minimum hourly wages. Some economists fear that rising wages could lead to further inflation.
Biden flatly rejected this view of the economy in his speech on Thursday: “When it comes to the economy we are building, rising wages are not a mistake, but a feature,” he said. The president renewed his call on Congress to raise the federal minimum wage to $ 15 an hour.
Biden credited the American rescue plan and ambitious vaccination program with the start of a US economy ravaged by the Covid pandemic. The bill passed without a GOP vote, but some Republicans later tried to attribute it to their voters despite voting against it.
“I’m not going to embarrass anyone, but I have a list of who is bragging about the bailout in their districts,” said Biden, holding up a list of Republicans who touted the aid funding.
“I mean some people are not ashamed,” he added. “I’m glad you know your voters benefited from it, that’s okay with me. But if you want to try to recognize what we’ve done, you’re not hindering what we have to do.” “
As Biden seeks to build support for more than $ 3 trillion in additional economic stimulus, Republicans argue that spending that magnitude is no longer needed given an improving economy.
Private sector wages rose 3% in the first quarter of this year, the fastest pace in at least 25 years, according to economist Mark Zandi. This has made it more difficult for employers to attract workers willing to work for a minimum hourly wage.
“We want something that economists call full employment. Instead of workers competing for scarce jobs, we want employers to compete with each other to attract workers,” Biden said.
Biden denied growing alarms from some corporations and economists that higher wages and full employment would lead to out-of-control inflation. Instead, companies could afford to pay more workers without passing higher prices on to consumers.
“Many companies have done very well in this crisis and are good for them,” he said. “But the simple fact is that corporate profits are their highest in decades. Workers ‘wages are the lowest they have been in 70 years. We have more than enough room to raise workers’ wages without raising customer prices . “
In addition to supporting higher wages, Biden has pushed for a corporate tax increase to 28%, revenue he will need to fund his ambitious infrastructure proposal. The US employment plan is to spend around $ 2 trillion over the next decade on revitalizing the country’s infrastructure and manufacturing.
The president also made it clear that he views these tax hikes as more than just a necessary evil to fund his grand plans: they are an integral part of restoring a sense of shared responsibility and burden across the American economy.
“We have the chance to use the economic dynamism of the first few months of my administration to not only rebuild, but also to rebuild better,” he said. “And this time we’ll take care of everyone.”