COMMENTS / EXPERT ASSESSMENT
Biden’s game of concocting narratives is akin to playing with fire
Published: May 08, 2022 03:12 PM Updated: May 08, 2022 02:55 PM
Illustration: Chen Xia/Global Times
Illustration: Chen Xia/Global Times

As only six months away from November US midterm elections, the mediocrity of the Biden administration in managing American economy and a number of international crises has become a political albatross for the Democrats, who fret about losing their majorities in the two chambers of Congress and Biden becoming a lame duck president within his first two years.

Recent opinion polls show the numbers are ominous for Biden and the Democrats. During the past 16 months, the administration has indulged in concocting narratives that only fit with its own needs or beliefs, but they are demonstrably detached from the facts.

To the chagrin of many in the US and across the world, the administration's narratives are simply based on illusions and very often bordering on lies. Increasingly, American voters feel fooled and swindled, which partially explains why Biden's approval ratings have slumped to around 40 percent.

When President Biden asked his fellow Democrats in the Senate and the House of Representatives to pass his controversial $1.9 trillion fiscal stimulus plan in early 2021, a number of renowned economists, including former secretary of Treasury and Harvard Professor Lawrence Summers, sent blunt warnings over inflation to the White House. But the dissenting voices from Summers and others against Biden's extravagant stimulus spending were rejected, heckled down, and even ridiculed.

When the US inflation sped up in July and August, the world heard Biden's narrative: Don't worry about the economy, and, the US inflation is only "transitory."

Inflation is now the number one kitchen table topic across the country after hitting highs not seen in over four decades, with the Biden administration quickly spinning a new narrative, blaming Russia and President Putin for the runaway prices. Last week, the US stock market crashed after the 50-basis-point interest rates raise by the Federal Reserve to contain inflation. Will Biden continue to blame the stock market rout and inflation on Russia and Putin? Let's wait and see.

Anybody with a basic knowledge of economics would know it is the US government's folly and mismanagement of the economy by Biden's team that caused the present-day predicaments facing American people. With the forced interest rate raises to curb surging inflation, the US economy now sits on edge, likely to see a hard landing in the coming months. Whether the country could avert another ferocious financial tremor like the 2008-09 global financial crisis is not known yet.

The International Monetary Fund (IMF) has warned that the global economy may grow at meager 3.6 percent this year due to a variety of headwinds, and, China's Foreign Ministry has called on the US government to put aside its Cold War mindset and do away with its zero-sum games with the world's major economies, in order to propel global cooperation and economic recovery.

However, China's persistent focus and call on achieving win-win in economic engagement between the world's two largest economies, has fallen on the deaf ears within the Biden administration. It is known to all that Donald Trump's massive trade and technology war with China did significant harm to the US economy, while seriously disrupting and derailing the global supply chain.

From the very beginning, Chinese economists have warned the tariffs and technology blockades imposed by Washington on China would inevitably lead to high consumer prices and inflation in the US, undercutting the living standards of tens of thousands of Americans.

But until today, the Biden administration has left most of the tariffs intact, while ramping up technology sanctions on a host of Chinese companies, such as Huawei, SMIC and Hikvision. As a result, Americans have seen the prices of across-the-board commodities in their supermarkets keep going up.

Both Trump and Biden officials have narrated that the punitive tariffs on Chinese imports and restrictions on technology supplies to Chinese companies were necessary to counter China's "malpractice in human rights and theft of American intellectual property rights, as well as pivoting to bilateral trade balance." This narrative, repeated hundreds of times, seems easily acceptable on the part of many American voters.

However, the US government's true intention is repressing China's economic competitiveness and containing China's rise, even though most US officials know perfectly well that a trade and technology confrontation will cause higher inflation and lower economic growth in the US.

Last week, an episode widely reported by American media, implicitly revealed the intentions of the Biden administration.

As the US is beginning a review of the tariffs imposed on $360 billion Chinese goods, with some policymakers, like Treasury Secretary Janet Yellen and Commerce Secretary Gina Raimondo, calling for the tariffs elimination to provide relief to American consumers facing inflation, Katherine Tai, the Trade Representative, said she is concerned about "ceding a leverage" to China. "But tariffs do raise our domestic prices," Yellen said.

Average tariffs on Chinese products are now levied at 19.3 percent, according to the Peterson Institute of International Economics (PIIE), and cover more than two thirds of all goods the US buys from China. PIIE estimated that a trade liberalization policy equivalent to a 2-percentage-point reduction in tariffs could reduce American inflation by 1.3 percentage points.

The tariff and technology barriers set by the US are a clear form of self-harm, but the so-called China hawks in the Biden administration are reluctant to give up the leverage to counter China, even though ordinary American households are paying the cost.

To sum it up, it is time for the hawks in the Biden administration to carefully think about the tariffs on US inflation and stop concocting false narratives or engaging in disinformation to deceive American voters, otherwise the world will continue to watch the US playing with fire at the expense of the global economy.

The author is an editor with the Global Times. bizopinion@globaltimes.com.cn