Former Clinton treasury secretary Larry Summers raised concerns on Thursday over the economy and inflation during an interview on CNN’s “New day.”
“I do think that unfortunately some of the predictions that I made about the consequences of stimulus do seem to have come true,” Summers told CNN host Brianna Keilar. Summers predicted earlier this year that increased government spending from the coronavirus stimulus packages would set off “inflationary pressures” that haven’t been seen in a generation.
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Summers, who has criticized Democrats’ plans to spend trillions of dollars, clashed with the Treasury Secretary Janet Yellen when she claimed he was “wrong” for worrying about out-of-control inflation.
“I think it’s a mistake to think of this as only an issue about stimulus,” Summers added. “It’s also an issue around what’s happened with the Federal Reserve. It’s also an issue around the fact that Covid mutated into the Delta variant. It’s also related to broad geopolitical developments and climate that have impacted on the energy markets.”
Keilar asked how long Summers expected this inflation to last, leading Summers to admit the economy may be suffering for longer than anticipated.
“I think it’s almost certain to last for another six to nine months, and it could well last longer,” he answered.
While Summers implored the Biden administration and Congress to work on passing more infrastructure bills, he also warned the federal government to be more careful when it comes to their focus.
“I do think we’ve got a real issue with an overheating economy, and the Fed’s going to need to step in and help to control this. They started that process yesterday. I do think we need to be careful with our policies generally now to be focus on providing more supply rather than focus on supplying more demand,” Summers said.
Democrats have often downplayed the threat of inflation. White House Chief of Staff Ron Klain retweeted a comment claiming that concerns over inflation were only “high-class problems.”
Keilar, meanwhile, acknowledged the effects of inflation on average Americans by referencing an earlier interview that spotlighted the Stotlers, a Texas couple looking after nine children – two of whom are their biological kids, while they’ve adopted six more and have one foster child. Liberals criticized the segment and appeared to mock the family.
Data released in October revealed that inflation increased by 5.4%, the highest rate in 13 years.
Fox News’ David Rutz and Brian Flood contributed to this report.
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