The NPR Politics Podcast - Fuel Squeeze And Inflation Marker Could Create Trouble For Biden—If They Last

Episode Date: May 13, 2021

The president said the country's fuel supply will return to normal soon and that there was no cause for a run on gas stations. And a consumer goods price spike could give Republicans an easy-to-explain reason to oppose the president's high-dollar infrastructure bill. This episode: White House correspondent Tamara Keith, White House correspondent Ayesha Rascoe, and national political correspondent Mara Liasson.Connect:Subscribe to the NPR Politics Podcast here.Email the show at [e-mail] the NPR Politics Podcast Facebook Group.Listen to our playlist The NPR Politics Daily Workout.Subscribe to the NPR Politics Newsletter.Find and support your local public radio station.Learn more about sponsor message choices: podcastchoices.com/adchoicesNPR Privacy Policy

Hi, this is Phoebe in Osnabrück, Germany. I just woke up from a dream where I was hanging out and talking politics with the entire NPR Politics podcast team. This podcast was recorded at 12.52 p.m. on Thursday, May 13th. Things may have changed by the time you hear this, but the things you hear will be reality and not part of a dream. Okay, here's the show. Wow. Was it a dream or a nightmare? I hope it was a good dream and not a nightmare. Yeah, yeah, that's the thing.

I hope we were good conversation for her. In her dreams, we're totally articulate. In her dreams. Hey there, it's the NPR Politics Podcast. I'm Tamara Keith. I cover the White House. I'm Ayesha Roscoe. I also cover the White House. And I'm Mara Liason, national political correspondent. The colonial pipeline provides about half of the East Coast's fuel, which became very obvious when it was shut down for several days following a cyber attack that happened last week that is now

slowly beginning to recover. Aisha, what do we know about what happened there? Well, we know that there was some sort of ransomware attack. They're thinking that it was by some criminal groups or criminal group or hacker that basically, you know, make it difficult to access computer systems unless a ransom money is paid. So these people attacked a system. And this time, this sort of thing, I think, happens more often than people realize. But this time it was so serious and the company, I guess, could not get it done fixed quietly. So they had to shut down an entire pipeline that, as you says, fuels like the East Coast. And that's a big deal.

Yeah. And it became an even bigger deal because lines started showing up at gas stations and signs saying we're out of gas and gas prices spiking in places. And this is a politics podcast. In politics, there is one thing you do not want to have a problem with, and that is gas. Yes. Like that is like gasoline is something that people instinctively, it is visceral. It is something tangible. People can see the price. They see when it goes up, they see the lines. And in the U.S. at this point in time, people expect to be able to go to their gas station and get some gas. And if they cannot do that, there is heck to pay for politicians. Yeah, right. So the big question is, how long does this last? According to the president who talked about this today, it's pretty much going to be resolved by the weekend. I know seeing lines at the pumps or gas stations with no gas can be extremely stressful. But this is a temporary situation. Do not get more gas than you need in

the next few days. As I said, we expect the situation to begin to improve by the weekend and into early next week. And gasoline supply is coming back online. And panic buying will only slow the process. And he also sent out a warning to gas stations, don't try to take advantage of consumers during this time. Don't price gouge. And he said that he a warning to gas stations, don't try to take advantage of consumers during this time. Don't price gouge. And he said that he's actually going to be working with governors to investigate price gouging and stop it. He said that's what the hackers try to do. That's not what we should try to do.

And this is sort of a fascinating thing about human behavior and economics and supply and demand. But just the mere idea that there could be scarcity caused a lot of people to say, well, my tank's half empty. I'm just going to go fill it up. You know, like you wouldn't normally fill it up, but what if we're run out of gas? I'm going to go fill it up. And the act of everybody doing that. It's kind of like toilet paper or ketchup packets, only worse. Yeah, or like chicken or pork. Yeah, except, well, I mean, you do need toilet paper. I would argue you don't need ketchup packets. You will survive.

Maybe, so you say. Yeah, speak for yourself. No, it fed itself, right? Like people like saw the long lines and then got in line, right? Like, I gotta go get gas. And it becomes like a priority. Yeah. And you know, what's interesting is, as far as a political problem, this appears to be, at least according to the Biden administration, a criminal act, not a government-sponsored cyber attack. He says the criminals lived in Russia,

but they don't have any evidence that the Russian government was involved. Although he said that responsible governments should take action against ransomware networks if they live on their territory. But, you know, if this got out of control, people would be asking, why haven't you fixed it, President Biden, even though it's not technically his problem? So today he came out with some executive orders and some actions that he's taking that he hopes will mitigate this and try to prevent it from happening again. But in terms of politics, almost immediately the attacks started coming. And the former president compared him to Jimmy Carter unfavorably. And, and Republicans really seized on this saying, look,

your gas prices are going up. You can't even get gas. This is all president Biden's America. This is an example of those things that you, you can't necessarily, that happened to it under a president's watch that you don't necessarily plan for. And it's also something that politically, because it seems like it'll be wrapped up pretty soon,

it probably won't have long legs. But this is something that Republicans can particularly hit a Democratic administration on because they will say you're not supporting oil and gas drilling. This is a very common thing there. You know, Republicans want to be the party of drill, baby drill. And people remember back in the day during the Bush administration when that was a big deal. And Democrats generally are not. So when it comes to energy and you have, you know, Democrats talking about climate change and things like that, this fits into that narrative of, even though it's very different, it fits into the narrative of, oh, Democrats are going to make your gas prices go up.

Oh, Democrats are going to make it harder for you to use fossil fuels. That is not what happened in this case. But you can make that argument just because something bad that happened related to gasoline. Yeah. And it's really hard to know what day-to-day problems, what kind of political damage they'll do to an incumbent party. In other words, everybody thought, oh my God, Trump said something outrageous. This is really going to hurt him. And it really never did. Over time, the big picture was the guy never could get his approval ratings over 50 percent. And that was probably more important. So, you know, it's hard to separate out the daily problem from the real political damage over time. That's why covering politics keeps you humble. Yeah.

Because you just don't know. Absolutely. All right. Well, we need to take a quick break. And when we get back, an economic indicator that certainly has the markets worried. Today, it seems like everybody's got a bone to pick with the news. So it happens when somebody stops talking smack and just decides to wage all out war. First thing you do in an evasion, you eliminate the communications of the enemy. And what happens if they win? Visit Stockton, California, for a story about a revolt against the mainstream media

that's shaken up a city. From NPR's Invisibilia. And we're back. And almost every day, a new economic indicator comes out. Friday, it was the jobs report. Earlier this week, there was the consumer price index. And consumer prices in April were about 4% higher than they were for the same period the year before. That is the largest 12-month increase since the 2008 financial crisis.

And what we call that is inflation, or at least it's raising concerns about inflation. Right, Aisha? Yeah, that's the thing is that the idea that prices for goods that we pay are going up, you know, at a level that could be of concern. Now, there's a lot of economic economists, people who look into these things. I am not an economist. I am a journalist because I'm not really good at math. But you are a journalist who covered the economy for a long time, though, which helps. I did, you know, but I rely on the experts. But the thing is that this increase, it was expected that inflation would go up. It wasn't expected that it would necessarily

go up this much. And so there's a question of whether this is a concerning long-term trend, or is this something that is just a transitional thing? And that's going to make a big difference to whether you want to pump a lot of money into the economy, like through infrastructure bills or jobs bills that could overheat the economy in a sense. been some inflation. There have been supply chain disruptions or, you know, factories that had to operate at reduced capacity. And so they were able to produce fewer goods. And so those goods got more expensive. If you have tried to do any sort of home improvement project, you know that wood is more expensive and other construction materials are more expensive. We were just talking about oil and gas pipelines. Gas prices are going up because people weren't driving for a big part of the pandemic. Well, guess what? People are driving everywhere now. We're free. Let's go.

And so that's increasing demand. And so gas prices are rising. The question is whether this is like an accelerating thing that is going to continue and could erode the value of the money that we have in our savings accounts or whether this is a temporary blip. jobs report for April. So the administration has now gotten two bad economic reports. First, jobs were created at a much, much lower level than most economists were predicting. The response of the White House was, we think this is a one-off, not a really bad sign about the sluggishness of the recovery. And then you have this inflation report. Is this the sign of inflation to come? Or is it the kind of thing that Jerome Powell, the Federal Reserve Chair, and Janet Yellen, the Treasury Secretary, and other Biden administration officials have been talking about, which is just what Tam described. temporary price hikes in certain sectors. But as supply chain problems get resolved, you know, as we overcome cyber attacks like the one we just saw on this pipeline, we're not going to have persistent problematic inflation. And to the extent we have a little, the Fed feels it can handle it pretty well. So I think we're a handful of jobs and inflation

reports away from knowing the answer to that question. Yes, because Mara, I think this is the time at which we say no single economic indicator in any single month is a trend. You need to see a few months to know. That's right. That's right. So we don't know that. And these things get revised. But it's worrisome enough that it's worrisome enough that you had a whole bunch of cabinet officials and the president himself out there talking about these things and making sure that they can put them in the context that they want to. And then, of course, you have Republicans saying, look, everything is falling apart. We have fewer jobs created and

worse inflation. And it shows you that Biden is failing. I just want to pull the lens out just a little bit because we're talking about inflation. I don't think that we have had occasion to talk about inflation in the history of this podcast, for instance. We certainly have not. It has been a really long time, like a very long time since the U.S. has faced inflation of any kind, any significant inflation. And if you want to talk about the granular level politics of this, to the extent that the Republicans think this is a good message for them, that inflation is back. That's why we shouldn't pass Biden's big infrastructure plans, because it'll pour too much money into the economy and overheat it, as Ayesha said, and increase inflation. The real target audience for that message are old people, because we haven't had inflation since the

late 70s and early 80s when we had the oil shocks and prices went up. And it was a problem. Inflation is very destabilizing politically and economically. And it hasn't been a factor for many, many years, for a generation or more. And that's a pretty significant thing when you've had a kind of stable economy like that. But the only people for whom that message would, I think, would mean something are people who've actually lived through it, and most of them are older voters. Higher prices, though, are not going to be good news for anybody, young or old. It has a big impact on those, especially those who may not have as much money to go around. I guess we can wait two, three, four, five, six. We're going to wait a few more months and see

what the trend really is. But for now, we are going to leave it right there. I'm Tamara Keith. I cover the White House. I'm Aisha Roscoe. I also cover the White House. I'm Mara Liason, national political correspondent. Who right now is sitting at the White House. And thank you for listening. Sitting at the White House. Yes, I forgot. And thank you for listening to the NPR Politics Podcast.