On Tuesday’s broadcast of CNBC’s “Squawk Box,” White House National Economic Council Director Lael Brainard responded to a question on real wages declining over the last three-and-a-half years by stating that “it is difficult for American consumers,” but “people actually have more purchasing power, even with those price increases, than they did pre-pandemic.”
Co-host Andrew Ross Sorkin asked, “Lael, what do you say…we’ve been talking for the past couple of days about this Greg Ip piece in The Wall Street Journal that looks at the way people are polled about how they feel about the economy, yet some of how the data seems to be at odds with it, but I wanted to ask you, when you look at inflation over the last three-and-a-half years, what you tell the voter who legitimately feels — and the data would support their feeling — that their wages have been outstripped by inflation?”
Brainard responded, “So, it is difficult for American consumers, and the president is very focused on the fact that, when you go into the grocery store, some of those prices went up, and although they are not rising any longer, they are higher than they were pre-pandemic. So, we’re seeing, for instance, the price of a gallon of milk and the price of a dozen eggs coming down over the last year, but still up relative to pre-pandemic. Now, we know, from the data that the earnings, wages have risen much faster than inflation. And so, people actually have more purchasing power, even with those price increases, than they did pre-pandemic. And they have more wealth, even with those price increases. But we have to keep fighting to bring down the prices of health care, where we are getting insulin prices down, inhaler prices down, caps on drug prices, as well as on things like groceries.”
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