Treasury’s Wally Adeyemo says Biden administration is doing everything it can to combat inflation and recession

The Biden administration is doing everything it can to prevent a recession, according to the deputy treasury secretary.

Adeyemo blamed the twin shocks of the Covid-19 pandemic and the war in Ukraine for record inflation rates in the U.S., but said the American economy is still strong.

The consumer confidence is high. Balance sheets for consumers and corporations are in good shape. Adeyemo spoke at the Delivering Alpha Investing Summit in New York City and said that the labor market has a lot of steam.

The administration is trying to bring down inflation through a number of measures, including the Inflation Reduction Act, the CHIPS Act and the bipartisan infrastructure law.

Adeyemo said that all three of them will help expand the productive capacity of the U.S. economy. We will be able to make sure that we have sustainable growth as we come out of this high inflation period.

Republicans say the administration's spending will increase the U.S. deficit as interest rates go up.

Adeyemo said that spending isn't the same. He said that the inflation reduction act will help expand the productive capacity of the economy by spending over time.

Better growth outcomes will come from investments that make the economy more productive.