As President Donald Trump struggles to address Americans’ growing affordability concerns, he has gotten some sympathy from one of former President Barack Obama’s former top economists.
“I’ve been puzzled,” Furman said. “When you’re in government, you’re told, politically, the one price that matters is the price of gasoline. That’s the one price that’s been great this year. And I sort of feel a tiny bit bad for President Trump that he doesn’t get any credit for that.”
“Consumers are just in this sort of, whatever the highest price is, is the price they’re going to focus on and be upset about,” he said. “And that’s a really hard problem to solve economically or politically.”
“If all you had were the jobs numbers, we’d all be doing our recession probabilities right now—Is it 30%? Is it 50%? Is it 70%?” Furman questioned. “But then we have this GDP growth number, and that just gives us our boom probability.”
“I’m less convinced about this K-shaped recovery than other people are,” Furman said. “Everyone wants prices to be 25% lower. Nobody wants their wages to be 25% lower.”
“We are seeing most of the productivity gains we’re seeing right now as really just the residual of companies being hesitant to hire and doing more with less,” she said.
