The Biden administration reinstated fast-track deportation flights for families amid renewed pressure to address the southern border surge

us-mexico border migrant children
Central American asylum seekers arrive to a bus station after being released by U.S. Border Patrol agents on February 26, 2021 in Brownsville, Texas.

  • The Biden administration resumed fast-track deportation flights to Central America on Friday.
  • The move comes after more than 188,000 migrants arrived at the southern border in June.
  • Biden is facing increasing pressure to address the migrants as COVID-19 surges along the border as well.
  • See more stories on Insider’s business page.

The Biden administration resumed fast-track deportation flights to Central America Friday as pressure grows to address the increase in migrants at the southern border.

“The Department of Homeland Security today resumed expedited removal flights for certain families who recently arrived at the southern border,” the agency said in a statement. “Families apprehended by Customs and Border Protection were removed via U.S. Immigration and Customs Enforcement Air Operations to their home countries of Guatemala, El Salvador, and Honduras.”

The move comes two weeks after Customs and Border Protection announced 188,829 migrants arrived at the border, the most of any month in recent history. The Delta variant of the coronavirus has also spread along the US southern border, prompting increased pressure on President Joe Biden to address the migrants.

Read more: Asylum-seekers are fleeing Haiti and Cuba, but the US won’t let them in. After decades of political meddling, America needs to throw open its borders.

“The expedited removal process is a lawful means to securely manage our border, and it is a step toward our broader aim to realize safe and orderly immigration processing,” the DHS statement said.

The expedited removal is used for families that cannot be deported under Title 42, a public health order invoked by former President Donald Trump during the pandemic to expel migrants without allowing them to apply for asylum due to disease-related risks. Officials had said in June they were planning to end Title 42 enforcement, but sources told Politico this week it will remain in place.

Republicans have criticized plans to ease the Trump border restrictions, especially as COVID-19 cases rise. In a statement provided to Insider, Sen. Lindsey Graham called on the administration to answer questions such as whether apprehended migrants are being tested for COVID-19 and what the quarantine protocols are.

Some of the migrants that were intended to be deported on an expedited flight Friday were unable to board due to positive COVID-19 tests, The Washington Post reported. DHS officials told The Post only 73 people out of 147 set to leave were allowed on a flight that departed from Brownsville, Texas.

Have a news tip? Contact this reporter at kvlamis@insider.com.

Read the original article on Business Insider

Democrats are scrambling to renew a eviction moratorium after Biden urged extension at the last-minute

Sherrod Brown
Sherrod Brown.

  • House and Senate Democrats are scrambling to renew a federal eviction ban after Biden urged them at the last-minute.
  • In a statement to Insider, a spokesperson for Sen. Sherrod Brown said he was working with Schumer on legislation.
  • Nearly six million people are at risk of eviction starting in two days.
  • See more stories on Insider’s business page.

Congressional Democrats are rushing to assemble legislation to renew a federal eviction ban before it expires

Democrats in both chambers are trying to draft a bill and put it to a rapid vote sometime in the next two days. The moratorium expires on July 31. After that, around 6 million people are at risk of getting evicted in the coming months, or 16% of all renters, per Census Pulse Survey Data.

The Biden administration on Thursday said it would not renew a federal eviction ban and the matter was ultimately left up to Congress, citing a recent Supreme Court ruling. The high court’s decision stated that Congress needed to renew it.

White House Press Secretary Jen Psaki said though the administration “strongly supported” renewing the federal eviction ban, the Supreme Court ruling essentially tied its hands. The administration instead called for the quick dispersal of emergency rental aid which has been slow to get to renters. Psaki also said Biden is asking various federal agencies to implement limited eviction bans through September’s end.

Banking and Housing Committee chair Sherrod Brown initially held off pushing for an extension, saying it should be left up to the Center for Disease Control and Prevention. The agency intervened and put the moratorium in place last year under President Donald Trump, citing the urgency of preventing the spread of COVID-19.

Now Brown is playing a key role assembling a bill to renew it past July 31.

In a statement to Insider, a spokesperson for Brown’s office said he “supports an extension of the eviction moratorium and will work with Leader Schumer to pass legislation that will allow our nation’s renters to stay in their homes during this crisis.”

It was unclear what date House and Senate Democrats would ultimately agree on. A person familiar with the talks in the House said their version would attempt to extend it sometime until the end of the year.

Democrats in recent days had stepped up their calls for the administration to renew the ban. Rep. Alexandria Ocasio Cortez and Sen. Dick Durbin of Illinois, the second-ranked Senate Democrat, were among them.

Read the original article on Business Insider

Biden wants to hear the public’s stories about the student loan forgiveness program with a 98% denial rate

student debt graduation
  • The Education Dept. is launching a public inquiry on the Public Service Loan Forgiveness program.
  • The program, which is supposed to forgive student debt for public servants, rejects 98% of applicants.
  • Anyone can submit comments which the department will consider when implementing improvements.
  • See more stories on Insider’s business page.

If the Public Service Loan Forgiveness (PSLF) program worked as it should, then every qualifying public servant would be able to receive student debt relief after 120 qualifying monthly payments. But complicated paperwork and eligibility requirements have made it so that 98% of applicants have been denied relief, even if they qualify.

That’s why, on Friday, the Education Department launched a public inquiry to fix the program.

“Unfortunately, for too many public service workers, the program has not functioned the way they hoped it would,” Julie Margetta Morgan, senior advisor and acting under secretary for the Office of the Under Secretary of Education, wrote in a blog post.

“Fixing the PSLF Program has been a priority for the Biden-Harris Administration since day one,” she added. “While we have identified many opportunities for improvement by talking to experts and borrowers and reviewing our procedures, we want to hear from you as well.”

President Joe Biden campaigned on reforming PSLF following its high denial rate under President Donald Trump, and fixing the program was even included in the Education Department’s regulatory agenda that was released last month. But implementing changes to the program could take at least a year, and the public inquiry would help the department more easily identify the problems it needs to fix.

Starting next week, anyone can submit comments to the department regarding PSLF, and the department specifically wants to know:

  • What features of PSLF are most difficult to navigate?
  • What barriers are preventing public servants from receiving student loan forgiveness under PSLF?
  • For borrowers who have had loans other than from the Direct Loan program, what have your experiences been trying to access or participate in PSLF?

Many Democratic lawmakers have stressed the need to reform the program to give public service workers the student debt relief they deserve. In May, 56 Democrats sent a letter to Biden urging him to quickly reform the program and eliminate the “extraordinary confusion” it places on borrowers.

They wrote: “The program has been beset by numerous ‘donut holes’ that disqualify certain types of loans, repayment plans and the payments themselves, leading to extraordinary confusion and distrust of the PSLF program and, by extension, the federal government.”

Seth Frotman, executive director of the Student Borrower Protection Center – which advocates for borrowers’ rights – said in a statement that the move by the Education Department to launch a public inquiry “offers hope for public service workers who have been let down and cheated out of promised debt forgiveness.”

“For the first time, the federal government is asking those who depend on the program to help decide what comes next,” he said.

Read the original article on Business Insider

The Delta variant could make the American shopper go back into lockdown, BofA says

People shopping
Bolstered by three rounds of stimulus checks, US consumers have been spending more.

  • The Delta variant could hurt the American shopper, and the economy, BofA Research says.
  • As the variant surges, economists predict a pullback in spending given concerns of catching it.
  • They cited Michigan, where spending declined after February’s Covid wave, despite no change in restrictions.
  • See more stories on Insider’s business page.

Something may be changing in the American economy for the worse, and it’s because of the Delta Covid variant. At least that’s what Bank of America research thinks.

The stock market had a major wobble on Monday, July 19, as data on the variant – and how many Americans it’s rapidly infecting – challenged economic thinking around the reopening boom, led by consumer spending. In a signal of how seriously the mood changed, previously vaccine-skeptical Republican politicians and Fox News hosts reversed themselves, urging more Americans to get vaccinated.

The American shopper emerged from lockdown to lead the recovery, but that’s now at stake.

BofA economists Stephen Juneau and Anna Zhou wrote in a Friday note that the variant is likely to lead to a shift in consumer behavior going forward, citing a 351% surge in the moving average of daily cases since July 21. Accompanied by slowing vaccination rates, they said they “believe the current surge in cases could lead to a sharp pullback in services spending.”

Daily new COVID-19 cases compared to consumer spending.
BofA compares daily new COVID-19 cases to consumer spending.

Juneau and Zhou wrote that the most vulnerable part of the economy from another COVID-19 wave would be the leisure and hospitality sector, which notably added 343,000 payrolls in June – 40% of the total 850,000 jobs gain.

Another factor they are concerned about with the Delta variant is the lack of government aid. When the pandemic first hit, Americans received stimulus checks and other benefits from President Donald Trump’s CARES Act, then another Trump stimulus in late 2020, and finally President Joe Biden’s American Rescue Plan, but another isn’t being discussed. The $4 trillion infrastructure proposal Biden wants to further stimulate the economy is at risk of being watered down in bipartisan negotiations.

Since governments seem unlikely to implement fresh restrictions as cases rise, the economists predict that most states will likely respond to the surge in infections by pushing people to get vaccinated, meaning that “shi sts in consumer behavior will determine how Delta affects economic activity and experiences during prior waves may not offer the best guide.”

They used the example of Michigan to back up their prediction. The state made no changes to restrictions during the Covid wave in late February, but consumer spending still decreased afterward, with services industries taking a major hit as less people dined out, and employment declined.

From a global perspective, BofA’s Ethan Harris wrote that several countries are experimenting with permitting or not permitting high-risk activities, and overall, he sees Delta as a “moderate headwind to global growth.”

To date, as Juneau and Zhou wrote, there has been little evidence of the variant significantly affecting the economy or spending on services, but with increased hesitancy of being in physical locations, the impact could become more prominent.

And given that Biden officials are considering adopting stricter mask guidance as the variant continues to spike, the consumer-led American boom coming out of lockdown could go back into some form of it.

Read the original article on Business Insider

Hearing aids cost an average of $5000. Biden’s plan to make them affordable doesn’t go far enough.

child being fitted for a hearing aid
Hearing aids are customized to respond to your specific hearing experience, while PSAPs are one-size-fits-all.

  • President Biden’s recent executive order aims to address, among other things, the exorbitant costs of hearing aids.
  • Hearing aids cost an average of $5,000 and are rarely covered by insurance.
  • Only 14% of the 48 million Americans with hearing loss can afford hearing aids.
  • Over-the-counter hearing aids are not meant for children or those with severe or profound hearing loss.
  • Erin Marsh is a writer and yoga teacher from the Midwest.
  • This is an opinion column. The thoughts expressed are those of the author.

President Biden issued an executive order last week to promote competition in the American economy. The order aims to address, among other things, the exorbitant costs of hearing aids.

My family knows the sky-high prices of hearing devices all too well. Our 5-year-old daughter, Camille, and I are both hard of hearing with a rare reverse-slope hearing loss, or low-frequency loss. We paid over $3,000 for Camille’s hearing aids, none of which was covered by insurance as hearing aids are considered cosmetic and elective.

We were able to secure a grant for her FM receiver, which allows her to participate in sports and better understand teachers, and that was another $3,000. Her hearing tests – which are required annually by the audiologist to adjust her hearing aids – cost just under $800, with only a portion covered by our insurance. My own hearing aids would have been nearly $5,000 through an audiologist, but I opted for the cheaper route: Costco hearing aids for roughly $2,000. Our hearing aids must be replaced approximately every 5 years for the duration of our lives.

The Fact Sheet issued by the White House asserts the executive order will “save Americans with hearing loss thousands of dollars by allowing hearing aids to be sold over the counter at drug stores.”

However, the Obama administration attempted to make hearing aids more affordable and as easy to purchase as reading glasses. Then the Over-the-Counter Hearing Aid Act of 2017 promised to effectively lower costs, yet prices remained steady. The White House explains this was because “the Trump Administration Food and Drug Administration failed to issue the necessary rules that would actually allow hearing aids to be sold over the counter, leaving millions of Americans without low-cost options.” The hope is the Biden administration can learn from past errors to enact lasting change this time around.

I have been hard of hearing likely since birth, yet I am only on my second pair of hearing aids due to cost, and we are a middle class family. I am not alone: Only 14% of approximately 48 million Americans with hearing loss can afford the hefty price tag. On average, hearing aids cost $5,000 a pair and are seldom covered by insurance.

My hearing loss went undetected most of my life despite the fact that it is significant. Low-frequency losses go undiagnosed largely for two reasons: speech is rarely affected, and basic hearing tests check for high-frequency loss as it is the most common. Eventually I failed a school hearing test in elementary school, but my results fell through the cracks, and my mother wasn’t alerted of the results until I reached junior high. In the 90s, I was not offered accommodations or placed on an Individualized Education Program (IEP), and my single mother couldn’t afford thousands of dollars on hearing aids. I spent my educational years adapting the best I could.

My first professional job after graduating college was teaching high school English in NYC, and I certainly couldn’t afford hearing aids living in one of the most expensive cities in the world on a teacher’s salary. It wasn’t until I settled down in Ohio and heard about financial help through the Ohio Bureau of Vocational Rehabilitation that I received my first pair in my late 20s. However, I was explicitly told that the program was “one and done.” I needed to pay for future hearing aids on my own.

By the time that pair stopped working, I had become a mother and transitioned to a career in writing. I couldn’t justify spending thousands of dollars (that we didn’t have) on hearing aids as a writer. I reasoned that I’d spent most of my life without hearing aids and was used to it, so I could continue to make do.

But then my daughter was born. She passed the newborn hearing test and her preschool auditory exam, but again, they only test for high-frequency loss. Despite the passing results, I noticed the tell-tale signs of hearing loss – inability to understand unless facing someone, continuous glances at our mouths for clarification, blank stares when strangers asked questions – and I took her to an audiologist for a comprehensive audiogram (hearing test) where they discovered my identical moderately severe reverse-slope loss.

As is common, insurance didn’t cover a dime of her hearing aids. We applied for assistance through a state hearing program but were denied. We opted for the cheapest pair available for children through our audiologist – $3,200 – and are still paying them off almost two years later.

While President Biden’s plan could potentially help millions of Americans, it omits many. Over-the-counter (OTC) hearing aids are not meant for children, nor should they be. It takes a pediatric audiologist to appropriately fit and adjust hearing aids for a child. Furthermore, OTC aids would be available to those with mild-to-moderate hearing loss – not those with severe or profound loss. Whether or not they could work for rare hearing losses, such as cookie bite or reverse slope, is unclear.

The issue with providing hearing aids over-the-counter is that each hearing loss is unique; it truly requires a professional to appropriately fit hearing aids. In my experience, audiologists won’t/can’t adjust hearing aids bought elsewhere, leaving OTC hearing aid adjustments up to the individual. It would be like buying reader glasses at the pharmacy. Some may benefit, but most who need prescription glasses do not.

If the Biden administration could mandate that insurance companies cover a majority of hearing aid expenses – after all, glasses and braces are covered – then all hearing losses for all ages would be included. Some insurance companies do cover a portion of the expense, but it’s usually minimal, such as $600 of the $5,000. If the Biden administration could effectively lower the cost of hearing aids by increasing competition and also demand insurance coverage, then all might benefit. In other wealthy nations, hearing aids are covered – why not here? Right now the Biden plan is a first step toward improving access for the deaf/hard of hearing community but is not a comprehensive solution.

Yet any movement to help with the cost of hearing aids is appreciated, and perhaps the most promising part of this executive order is the challenge to monopolies. The four largest hearing aid companies control 84% of the market, which means they can set whatever astronomical prices they wish. Deregulation could jeopardize their profits, and Starkey Hearing Technologies responded by increasing their political contributions, spending more than big-name medtech firms.

In a world where a $300 watch contains the technological advances of a phone, how could hearing aids possibly cost an average of $5,000? Or what about an audiogram, which is a series of beeps and recordings dictated and transcribed by a computer, for which hospitals unapologetically charge $800? In contrast, an identical hearing test at Costco is free.

President Biden’s executive order is a first step in making the world more accessible and inclusive for all of us who are deaf and hard of hearing. With increased competition and wider availability, hearing aid prices will hopefully plummet. Perhaps one day, hearing aids will be as commonplace and affordable as a pair of glasses. In the meantime, we will need to continue to advocate for basic access to sounds that most people take for granted.

Read the original article on Business Insider

A federal judge in Texas has ruled that DACA is unlawful

GettyImages-dreamers-daca-supreme-court
Advocates for immigrants with Deferred Action for Childhood Arrivals, or DACA, rally in front of the U.S. Supreme Court June 15, 2020 in Washington, DC.

  • Nearly 826,000 people currently benefit from the Deferred Action for Childhood Arrivals Act, DACA.
  • A US District Judge in Texas ruled the program was illegal on Friday.
  • Judge Andrew Hanen barred the US from approving any new applications for the program.
  • See more stories on Insider’s business page.

A Federal Judge in Texas ruled that the Deferred Action for Childhood Arrivals, better known as DACA, was unlawful and suspended the approval of any new applications.

US District Judge Andrew Hanen ruled in favor of Texas and eight other conservative states in barring the US from approving new DACA applicants and said former President Barack Obama overstepped his authority when he enacted the program, which protects nearly 826,000 young immigrants from deportation.

DACA was established in 2012 and allows Dreamers, or undocumented immigrants who were brought to the US as kids, to apply for work permits.

Hanen’s ruling does not cancel the permits for those who already have them.

“Nothing in this injunction should be read as ordering DHS or any other governmental entity to cancel or otherwise terminate DACA status for any individual who currently is, as of this date, a DACA recipient in good standing,” Hanen wrote.

The judge said the program was “created in violation of the law and whose existence violates the law.” He ruled that Congress had not given permission to the Department of Homeland Security to create the program and that DACA also prevents officials from removing people from the country as part of the Immigration and Nationality Act.

“Congress has not granted the Executive Branch free rein to grant lawful presence outside the ambit of the statutory scheme,” Hanen wrote in the ruling.

Omar Jadwat, head of the American Civil Liberties Union’s Immigrants’ Rights Project, told the CNBC ruling “is wrong and is subject to appeal.”

Democrats are calling for Congress to pass quick legislation on the program.

“As we await the swift stay that the law clearly requires, Democrats will continue to press for any and all paths to ensure that the Dream and Promise Act, now passed twice by the House, becomes the law of the land,” House Speaker Nancy Pelosi said in a statement. “Democrats call on Republicans in Congress to join us in respecting the will of the American people and the law, to ensure that Dreamers have a permanent path to citizenship,” Pelosi said, calling Dreamers the “pride of our nation.”

Julián Castro, former United States Secretary of Housing and Urban Development during the Obama administration, called the decision a “gut-punch.”

“Dreamers have lived in uncertainty for far too long. It’s time Congress give them the protections they deserve. We must pass the budget reconciliation bill,” Castro said in a tweet.

President Joe Biden has previously said he supports allowing Dreamers to become citizens.

The White House and DHS did not respond to Insider’s request for comment at the time of publication.

Read the original article on Business Insider

AOC vows progressives will ‘tank’ the bipartisan infrastructure bill if a reconciliation bill including more care-economy and climate change measures isn’t passed in tandem

alexandria ocasio cortez
Rep. Alexandria Ocasio-Cortez, D-N.Y.

  • Biden’s bipartisan infrastructure deal cut out a number of care-economy measures from his initial plan.
  • AOC said progressive will “tank” the deal if a reconciliation bill isn’t passed at the same time.
  • The reconciliation bill would include more care-economy measures and climate change initiatives.
  • See more stories on Insider’s business page.

After President Joe Biden reached an agreement with a bipartisan group of senators on an infrastructure plan, many Democrats criticized how the deal cut out many care-economy measures, like eldercare and affordable housing.

Rep. Alexandria Ocasio-Cortez of New York doubled down on those criticisms on Thursday, promising that progressives will “tank” the deal unless a separate bill, full of care-economy measures, makes the cut, too.

Senate Democrats announced on Tuesday they had reached such a deal which they hope to pass in tandem with the infrastructure package through a political process known as reconciliation, which just requires a simple majority vote.

“House progressive are standing up…” Ocasio-Cortez said during a town hall. “We will tank the bipartisan infrastructure bill unless we also pass the reconciliation bill.”

On June 24, Biden announced he had reached an agreement on an infrastructure plan with the bipartisan group of senators after weeks of negotiations, ending up with a plan that was just under $1 trillion – cutting over a half of the president’s original price tag. This led many Democrats, including Speaker of the House Nancy Pelosi, to say that in order to win their support for the bipartisan deal, a reconciliation bill must be passed alongside it to get needed care-economy measures to the American people.

“There ain’t going to be an infrastructure bill unless we have the reconciliation bill passed by the United States Senate,” Pelosi told reporters at the time.

Biden even said during a press conference after announced the agreement that the infrastructure deal and a reconciliation bill would work “in tandem,” but he later walked back those comments following fierce opposition from Republican lawmakers.

But progressive lawmakers are still pushing for a reconciliation bill that they believe is urgent to meet the needs of the country, including addressing the climate crisis, and their promise to shut down the bipartisan deal if the reconciliation bill isn’t passed at the same time imposes difficulties for the deal’s future.

“If [Senate Dems] try to strip immigration reform, if they try to claw back on child care, climate action, etc., then we’re at an impasse,” Ocasio-Cortez said. “It’s a no-go.”

Read the original article on Business Insider

Biden says Hong Kong is ‘deteriorating,’ and the administration is set to release an advisory for US businesses on the situation

President Biden
President Biden speaks to reporters on July 8.

  • At a White House press briefing on Thursday, Biden said the situation in Hong Kong is “deteriorating.”
  • The White House is set to issue a business advisory – expected Friday – for US companies.
  • China has been clamping down on Hong Kong’s pro-democracy movement.
  • See more stories on Insider’s business page.

At a White House press briefing on Thursday, President Joe Biden said the situation in Hong Kong is “deteriorating” and said the administration is set to issue a business advisory – expected Friday – “as to what may happen” in Hong Kong.

“Let me talk about the business advisory,” Biden said. “The situation in Hong Kong is deteriorating. And the Chinese government is not keeping its commitment that it made, how it would deal with Hong Kong.”

“It’s as simple as that and as complicated as that,” Biden said at the press conference alongside German Chancellor Angela Merkel.

According to The Wall Street Journal, the advisory is expected to be aimed at US businesses, not sanctions against China.

The statement comes as China’s grip on Hong Kong tightens. In May 2020, China passed national security legislation under which the country is allowed to set up a police presence in Hong Kong. The legislation limits the freedoms Hong Kong has had since 1997.

In March, 47 pro-democracy protesters in Hong Kong were charged with “conspiracy to commit subversion.” Days later, China announced that it plans to overhaul Hong Kong’s electoral system and install in leadership positions “patriots” loyal to Beijing.

The White House did not immediately reply to Insider’s request for comment.

Read the original article on Business Insider

Biden says US and Germany are launching climate and energy partnership including joint plans to slash carbon emissions

President Biden and German Chancellor Angela Merkel
  • President Joe Biden announced that the US and Germany were planning to enter into a new climate and energy partnership.
  • German Chancellor Angela Merkel’s visited the White House on Thursday.
  • He also addressed protests in Cuba.
  • See more stories on Insider’s business page.

President Joe Biden revealed that the US and Germany are planning to enter into a new climate and energy partnership, an announcement made during German Chancellor Angela Merkel’s visit to the White House on Thursday.

“Today, we’re launching a climate and energy partnership to support energy security and the development of sustainable energy,” Biden said at a joint press conference with Merkel.

According to a fact sheet distributed by the White House, the partnership will be co-chaired by John Kerry, the special presidential envoy on climate, and Jennifer Granholm, the energy secretary, as well as their German counterparts. It will focus on three areas of cooperation: developing joint plans to slash carbon emissions; collaboration on new green energy technologies; and assisting developing countries in addressing climate change.

Under the Paris Agreement, the US and Germany have committed to achieving net-zero greenhouse gas emissions by 2050 at the latest in an effort to avoid environmental catastrophe.

The partnership also aims to address the use of energy supplies as means of strong-arming nations, a topic Biden touched on at Thursday’s press conference.

Noting concerns about the Nord Stream 2 pipeline project, which would transport natural gas from Russia to Europe, Biden said that Moscow “must not be allowed to use energy as a weapon.” Both leaders also addressed the extreme flooding in Germany that has left at least 45 people dead.

At the end, Biden was questioned by reporters about the protests going on in Cuba. “Communism is a failed system,” he said, “and I don’t see socialism as a very useful substitute, but that’s another story.”

Read the original article on Business Insider

What America’s CEOs are saying on inflation: We’re going to charge you more

In this photo illustration, hands are seen counting US $100 bills.
In this photo illustration, hands are seen counting $100 bills.

  • Inflation, or increased pricing for goods, is on the rise as the economy reopens.
  • Biden’s administration and the Fed says the price increases should be temporary.
  • But CEOs of major companies are saying that higher prices could persist.
  • See more stories on Insider’s business page.

The country is reopening and the economy is recovering from the pandemic, and while COVID-19 cases are down, prices for goods and services are on the rise. President Joe Biden’s administration says this phenomenon, known as inflation, is not a cause for concern, but CEOs of major companies are warning that they’ll probably keep raising prices.

The Bureau of Labor Statistics’ monthly Consumer Price Index release showed that inflation in June was much higher than expected, with prices surging 0.9% over May, the highest month-over-month inflation rate since April 2008’s 1.0% increase. It was fueled by big price increases for used cars, beef, and pork, and the government insists it should cool down soon.

Labor Secretary Marty Walsh told Insider in early July that he’s not worried about the increase in prices for goods, especially given that wages also increased in June.

“The one thing that we are not concerned about is … inflation,” Walsh told Insider. “We’re still in transition, so we’re not concerned about that. So I think anytime we can push for higher wages – and the president’s been very vocal on this – that’s a good thing for people.”

Treasury Secretary Janet Yellen said in May that the high prices should only last through the end of this year, and Biden said during a June press conference that the “overwhelming consensus” is that inflation should “pop up a little bit and then come back down” – similar to the consensus from America’s central bank, led by Federal Reserve Chair Jerome Powell.

The economics field is not close to that consensus. Former Treasury Secretary Larry Summers has pointed to Biden’s $1.9 trillion stimulus as the “least responsible” fiscal policy in 40 years, one that could potentially trigger the dreaded hyperinflation. Increasingly, executives are saying that price increases are here to stay. Here’s what else they’re saying:

JPMorgan Chase CEO Jamie Dimon

JPMorgan CEO Jamie Dimon.
JPMorgan CEO Jamie Dimon.

JPMorgan Chase CEO Jamie Dimon said during an earnings call on July 13 that inflation “could be worse than people think.”

“I think it’ll be a little bit worse than what the Fed thinks,” Dimon said. “I don’t think it’s only temporary.”

In June, Insider reported that Dimon said the bank was stockpiling $500 billion in cash in anticipation of higher inflation, during which he expressed the same concerns with the nature of inflation, in that it will be more persistent than what people are saying.

JPMorgan did not immediately respond to Insider’s request for comment.

 

BlackRock CEO Larry Fink

GettyImages 480950078

Larry Fink, the CEO of investment management corporation BlackRock, reiterated Dimon’s concerns on the nature of inflation in a CNBC interview on July 14.

“[Policymakers] are saying jobs are more important than consumerism,” Fink said. “That is going to probably lead to systematically more inflation.”

Biden has consistently touted job growth as a primary achievement of his administration so far, and Republican lawmakers have even cut off unemployment benefits early in an effort to incentivize people to return to work.

But Fink said that move takes the focus away from consumers, causing large-scale price increases.

“I’m hearing from every CEO that they have huge price increases, and they’re passing them on across the board, here in the United States and in Europe,” Fink said.

BlackRock did not immediately respond to Insider’s request for comment.

PepsiCo CFO Hugh Johnston

FILE PHOTO: Bottles of Pepsi are pictured at a grocery store in Pasadena, California, U.S., July 11, 2017.   REUTERS/Mario Anzuoni/File Photo
FILE PHOTO: Bottles of Pepsi are pictured at a grocery store in Pasadena

To help counter the effects of inflation, some business leaders are explicitly saying they’re raising prices for their goods on consumers. PepsiCo’s CFO Hugh Johnston is one of them.

“Is there somewhat more inflationary pressures out there? There is,”  Johnston said on an earnings call on July 13. “Are we going to be pricing to deal with it? We certainly are.”

The CEO of industrial supplies company Holden Lewis echoed Johnston on an earnings call the same day, saying that “based on what cost is doing,” the company will have to increase prices on consumers.

Lewis said, though, that a previous price increase the company made was received “fairly well,” suggesting consumers might not be discouraged by increased prices. 

Pepsi did not immediately respond to Insider’s request for comment.

Read the original article on Business Insider