Democratic Senator Mark Warner admitted that President Joe Biden’s $1.9 trillion pandemic relief package was too big, and that the Federal Reserve took too long to raise interest rates.
“Was there too much in the American Rescue Plan on a relative basis? Absolutely,” said Warner, who chairs the Senate Intelligence Committee while speaking with Bloomberg Television.
Warner said that in retrospect, he and fellow lawmakers were worried about the economy falling apart – but there are now mounting concerns over spending. In a separate Tuesday interview with Bloomberg, Warner also admitted that what became the so-called “Inflation Reduction Act” was “way more than it should have been” before it was whittled down by West Virginia Sen. Joe Manchin.
Warner said a bipartisan budget deal including long-term spending and revenue changes to bring down the deficit would be good policy, citing rising federal interest payments as a reason to act.
“Is there an appetite? I hope so. Is there any movement on that at all? No,” Warner said. “Neither party has any credibility on this issue.” -Bloomberg
Now, inflation is running at a 40-year high – giving Republicans ample ammunition to point the finger at Biden’s March 2021 stimulus bill. Warner was quick to point out that more than $3 trillion in pandemic support was passed under Trump.
Warner also blames the Fed, saying it “waited too long to start his process” of raising rates.
Warner, whose comments were highlighted by Senate Republicans, said that he didn’t think the Democratic spending measures have had much of an impact on inflation and that he didn’t regret voting for pandemic relief. Instead, he put much of the blame for the cost-of-living surge on the Federal Reserve, which he said was slow to raise interest rates. -Bloomberg
In March, the San Francisco Federal Reserve Bank said that fiscal stimulus during both the Trump and Biden administrations contributed to inflation, but that they likely helped keep the economy afloat.