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Chairman Smith: Biden Owns These High Interest Rates, Making It Harder for Americans to Own Anything Else

May 01, 2024

“Interest rates remain at the highest level in 23 years, and are not falling as projected, because ‘Bidenflation’ has a stranglehold on the economy.”

WASHINGTON, D.C. – Ways and Means Committee Chairman Jason Smith (MO-08) released the following statement in response to the Federal Reserve’s announcement that it will again maintain interest rates at the highest level in 23 years:

“President Biden owns these historically high interest rates, making it harder for Americans to own anything else. Workers, families, farmers, and small businesses are desperate for any sign of relief. Instead, interest rates remain at the highest level in 23 years, and are not falling as projected, because ‘Bidenflation’ has a stranglehold on the economy. Every time the Federal Reserve is forced to keep rates high, more families are locked out of buying a home, more families drown in credit card debt, and small businesses cannot grow and expand. That’s President’s Biden’s legacy. 

“To make matters worse, President Biden’s solution to the economic crises he created is to allow the Trump Tax Cuts to expire, which will result in the largest tax hike in American history on workers, families, farmers, and small businesses while further eroding economic growth. It took President Biden more than a year to admit inflation was not transitory. The American people cannot afford to wait for him to admit that trillions of dollars in new taxes is a bad idea. Instead, America needs to return to the bigger paychecks and historically strong economy sparked by those tax cuts. Ways and Means Republicans are busy fighting President Biden’s $7 trillion tax hike and building on the success of the Trump tax cuts. Our tax teams are listening to the American people and coming up with the best ways to help workers, families, farmers, and small businesses thrive and bring an end to the failed policies of ‘Bidenomics.’” 

READ: Ways & Means Chairman Smith and Tax Subcommittee Chairman Kelly Announce Tax Teams to Avert 2025 Tax Cliff

Key Background: 

  • The Federal Open Market Committee announced the Federal Reserve is maintaining interest rates at the highest level in 23 years.
  • The Federal Reserve chose to maintain interest rates instead of cutting rates because inflation reports over several months show inflation is higher than expected and is accelerating.
  • The Bureau of Economic Analysis released its first estimate of Gross Domestic Product (GDP) for the first quarter of 2024 last Thursday showing much lower-than-expected growth at 1.6 percent. Expectations were nearly a full point higher.
  • Real wages and benefits have fallen 3.9 percent since President Biden took office.
  • Inflation outpaced wages for 26 straight months of Biden’s presidency.
  • Mortgage rates reached a 23 year high of 7.8 percent in October. The monthly mortgage payment for a median priced new home has increased by $1,198 and is 106 percent higher than when President Biden took office in January 2021.
  • Credit card interest rates are at the highest level in nearly three decades, while consumer credit debt has reached an all-time high of just over $1 trillion and the number of Americans struggling to pay credit card bills has increased sharply.