The Federal reserve's First Rate Reduction in more than four years could Directly impact the finances of millions Of Americans Jared bernin Joys us now to Discuss he is the chair of the White House Council of economic advisors Jared Thanks so much for making time for us Today I want to start right there can You talk about how today's decision from The FED will affect people across this Country well when interest rates are Coming down that means a lot for anybody Who's taking out are carrying in an auto Loan a mortgage loan uh a credit card uh Loan or for that matter a small business That wants to invest in uh the kind of Optimism that we see among uh small Businesses we've had 19 million business Starts over our watch and that's uh That's a a record uh we we also should Should bear in mind that in the Background between these lower interest Rates and lower inflation is an economy That has maintained its momentum with Low unemployment good job growth and Quite strong GDP growth in consumer Spending so I'd say this is good news Across the board and that's what brought Us here today Jared but can you talk About a time frame how soon will Americans uh be able to feel this impact Uh well uh already uh because if you Look at the mortgage rate since uh the Markets began predicting that the FED
Would lower interest rates as they Delivered on today uh you have what we Call call a priced in effect that is Some of these rate Cuts were priced in Before they were made we have the 30-year fixed rate mortgage at about 6% Right now that's down from uh probably Around 7 and a half where it peaked now We'd like to see it come down more than That and lowering housing costs is Absolutely key uh to the Biden Harris Agenda there are costs out there that Are still too high for sure and housing Is one of them we're working on that Lowering prescription drugs child care Cost junk Fe Any place we can help by lowering costs We're going to uh help push that Momentum in the right direction but I Think what we're seeing today is in fact Precisely that momentum in a Direction That's helpful for households and Families well former president Trump has Previously suggested uh that Federal Reserve chair Jerome pow would cut rates To help Democrats in this election and Now the First Rate cut since March 2020 Has happened less than two months before The election so what is your response to Trump's claim that this is a political Move well I have a response to that but Let me start out by reading something That was in a Wall Street Journal Editorial and they're not known for
Their left-leaning Proclivities uh they wrote quote we Don't agree that those who say a cut in Rates this week is political or intended To help kamla Harris again that's from a Wall Street Journal editorial you have a Veteran uh Fed chair in Jerome Powell Who's been through uh many Rodeo like This before he is not a political actor He says that consistently and we should All believe Him well you came prepared thank you for That Jared uh yesterday you posted Online about the US economy quote Defying expectations which played a role Here while acknowledging that there is Still more work to do on housing and Child care costs in particular so what Can the Biden Administration do in the Few months it has Left well let talk about housing and and Let's let's um broaden this out a bit From the Biden Administration certainly Uh vice president Harris has I think a Very uh positive housing agenda she's Talking about a plan that could add Three million affordable units both Rental units and uh homes uh to the Stock of affordable housing that has to Be done through the kind of careful Policy that she and the president have Articulated in ways that incentivize Builders and Developers uh to build Where they haven't so far part of that
Means trying to uh urge uh localities to Open up some of their land use Restrictions a lot of it means using uh Tax credits and subsidies to make these Deals pencil out for developers in ways That they don't and a big part of the Plan is expanding the lowincome housing Tax credit uh a a measure that has a Tried and true positive impact on Increasing affordable rental units now I Think it's important to make a stark Contrast uh with uh with the opponent uh Who Harris is running against who has Really no housing plan at all so uh I I Think plan beats no plan in this space And good plan especially beats no plan Oh Jared I'm so glad you brought that up Because you know she has introduced some Other policy proposals and I wonder how Realistic you think they are because When you talk about giving first-time Home buyers $25,000 when you talk about Capping child care costs at7 % for Working Families where's that money Going to come From well first of all let me point out That everything you're talking about Involves working with Congress okay These are not things that either Biden Or Harris could do by themselves and Congress absolutely should work with us On that because when you're talking About affordable housing the lack Therein this is a a 10 15 year o old
Shortage in the making when you're Talking about child care these are not Blue issues these are not red issues D's Are ours these are issues for every Working family who is trying to make Their budget pray for housing get into The labor market with child care uh so So I don't see anything partisan here in Terms of paying for them uh clearly we Have a budget that has $3 trillion doll Of deficit reduction so the F and that's Accounting for the kinds of programs I've just talked to you about so clearly We have to raise revenues cut spending Our budget does both and that's the way To get there I don't think the math is All that complicated you have to make Sure that your receipts to get closer to Your outlays and that's what that's what Our budget does well Jared I have many Many more questions but I'm out of time So we'll leave it there but thank you so Much my pleasure
