Biden economic adviser suggests definition of recession, says key areas ‘have not been flashing red’

The White House economic adviser, when grilled on concerns of a recession on Sunday, assured Americans that the answer to whether the Biden administration was doing everything possible to increase energy supply and drive down consumer prices is “unequivocally yes.”

In an interview on “Fox News Sunday,” White House Council of Economic Advisers member Jared Bernstein provided his definition for recession and noted a $1.4 trillion deficit reduction this fiscal year, but host Shannon Bream interjected that the number is coming off massive COVID spending.

Bernstein said noted that the figure is also influenced by receipts coming into the Treasury because of “how strong economy has been.” 

“We have an unemployment rate that is 3.5%. There is no recession that would prevail with that kind of unemployment rate. We’re obviously adding hundreds of thousands of jobs per month. We have consumers who still have pretty strong balance sheets. We still have job vacancies. … We actually think the probability for a soft landing is good,” Bernstein said.

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Bream noted that the widely respected definition of a recession is two consecutive quarters of negative action, but Bernstein said it’s “not up to the White House to call a recession.”

“I would look at the following variables, which happens to be the same ones that the group I was just talking about, retail sales, payroll, employment, consumer spending, industrial production, all of those have not been flashing red, all of those are not in recessionary territory,” Bernstein said. “Now, if you’re asking me to look around a corner and say where the economy is going to be, I got to tell you that everybody’s crystal ball is a bit cracked right now, and I think the uncertainty out there makes it tough.”

Bernstein admitted that consumer prices elevated to a point where “family budgets are squeezed,” but he said gas was down by 5% and that the price of gas fell about a third in the third quarter of this year after peaking out at $5 per gallon.

Now, there are 14 states with the price of gas at $3.50 or below, Bernstein said, tying the shift to President Biden’s release of oil from the strategic reserves.

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“If you look at the unconscionable actions of Putin, weaponizing energy, amplified by the short-sighted and misguided decision by OPEC+ recently, then sure, having the [Strategic Petroleum Reserve] there for potential release is an important tool,” Bernstein said.