“Lower costs, not wages”: Biden listens to the polls and takes aim at inflation as new domestic enemy number one

Comes as voters see rising costs as the major issue and as his domestic agenda has languished.

President Joe Biden focused heavily on reducing the federal deficit and combatting inflation in his State of the Union address Tuesday evening as much of the rest of his domestic agenda languishes in Congress.

Mr Biden’s address comes months after Sen Joe Manchin, a conservative Democrat from West Virginia, announced his opposition to Mr Biden’s signature Build Back Better legislation, an ambitious social spending plan that would have included provisions to combat climate change, home care for elderly people and people with disabilities, pre-kindergarten education, child care and extending an expanded child tax credit for low-income families.

Mr Biden said in January that he expected “big chunks” of Build Back Better signed into law. But those concerns took a back seat to the topic that concerns American voters the most ahead of the midterm election: inflation.

Follow the latest reaction to the State of the Union here

A poll from NPR, PBS NewsHour and Marist found that 38 per cent of Americans think Mr Biden should focus on inflation.

By comparsion, only 11 per cent of Americans think that the top priority should be the coronavirus pandemic and the same amount say voting laws should be the top priority. Meanwhile, 10 per cent of Americans think violent crime should be the top priority and the same number said foreign policy should be the top priority.

The first part of Mr Biden’s speech focused heavily on Russian President Vladimir Putin’s invasion of Ukraine

The same poll found that 56 per cent of Americans think Mr Biden’s first year was a failure and 54 per cent said that they do not think he is not fulfilling his campaign promises, while 51 per cent said they are economically worse off than they were a year ago.

The first part of Mr Biden’s speech focused heavily on Russian President Vladimir Putin’s invasion of Ukraine, the United States’s support for the people of Ukraine and the measures his administration is taking to combat it. But even then, Mr Biden could not ignore the concerns that people have about rising costs.

Last week, Mr Biden said he would do “everything” to “limit the pain” at the gas pump for Americans amid the crisis in Ukraine. In that spirit, he said how the United States and its allies were releasing 60 million barrels of oil from petroleum reserves around the world, with the United States releasing 30 million barrels.

“These steps will help blunt gas prices here at home. And I know the news about what’s happening can seem alarming,” he said.

Mr Biden was quick to highlight the rapid job growth during his administration and his success in combatting the coronavirus pandemic.

“Inflation is robbing them of the gains they might otherwise feel,” he said.

Mr Biden explained that the economy “roared back faster” than expected but that the pandemic meant businesses had difficulty hiring enough workers and that this was exacerbated by global supply chains. Some Republicans have contended that enhanced unemployment insurance discouraged workers from finding jobs and numerous Republican governors ended the unemployment insurance enhancement under the American Rescue Plan that passed last year.

President Joe Biden hands a copy of his speech to US House Speaker Nancy Pelosi (POOL/AFP via Getty Images)

“When factories close, it takes longer to make goods and get them from the warehouse to the store, and prices go up,” he said.

“One way to fight inflation is to drive down wages and make Americans poorer,” he said. “I have a better plan to fight inflation. Lower your costs, not your wages.”

In turn, Mr Biden said he planned to prioritise making more products in the United States.

“And instead of relying on foreign supply chains, let’s make it in America,” he said “Economists call it ‘increasing the productive capacity of our economy.’ I call it building a better America.”

In the same respect, Mr Biden also appeared to be speaking directly to Mr Manchin, who has emphasised debt reduction and concerns about inflation.

“My plan will not only lower costs to give families a fair shot, it will lower the deficit,” he said. Similarly, he said he planned to fight fraud committed during the pandemic.

“By the end of this year, the deficit will be down to less than half what it was before I took office,” he said. “The only president ever to cut the deficit by more than one trillion dollars in a single year.”

Biden stood flanked by Kamala Harris and Nancy Pelosi (Getty Images)

Mr Biden also framed his plans on corporate profiteering in terms of reducing costs for families.

“When corporations don’t have to compete, their profits go up, your prices go up, and small businesses and family farmers and ranchers go under,” he said. “And as Wall Street firms take over more nursing homes, quality in those homes has gone down and costs have gone up. That ends on my watch.”

Mr Biden also spoke about lowering insulin costs and pointed to his guest Joshua Davis, who is 13 years old and has type-one diabetes.

“Drug companies will still do very well. And while we’re at it let Medicare negotiate lower prices for prescription drugs, like the VA already does,” he said. Similarly, Mr Biden also mentioned the expanded child tax credit, which lasted until the end of last year and would have been extended under Build Back Better but to which Mr Manchin objected.

Mr Biden also urged Congress to pass the minimum wage and also was quick to highlight how the Centers for Disease Control & Prevention had loosened masking restrictions for many Americans.

“It’s time for Americans to get back to work and fill our great downtowns again. People working from home can feel safe to begin to return to the office,” he said. “Our schools are open. Let’s keep it that way. Our kids need to be in school.”

At the same time, Mr Biden looked address concerns about violent crime when he highlighted the bravery of two slain New York City Police officers Wilbert Mora and Jason Rivera while also calling for police reform.“We should all agree: The answer is not to Defund the police. The answer is to fund the police with the resources and training they need to protect our communities,” he said.

Plenty of Democrats fear that rheotric about defunding the police makes the party radioactive among working-class voters of all races.

But Mr Biden’s words also come as police reform has stalled after Sens Cory Booker and Tim Scott, a Democrat from New Jersey and a Republican from South Carolina, and Rep Karen Bass of California failed to reach an agreement to overhaul the nation’s police system last year.