The U.S. economy, or at least parts of it, bounced back quickly after a two-month recession triggered by the coronavirus pandemic in 2020. But just two years later, in April of this year, President Joe Biden and his aides began fielding questions about the possibility of another downturn.
During an April 18 briefing, then-Press Secretary Jen Psaki referred to that possibility as “the R word.”
“Obviously, we will continue to monitor any concerns we have about where things are headed,” she said.
Since then, the questions have only increased while White House aides attempt to convey the message that they’re not ignoring the recession risk while stressing that an imminent downturn is far from a fait accompli.
“First of all, it’s not inevitable,” said Biden himself during an interview with the Associated Press last week.
The White House message comes as others recognize that a recession could come soon as the Federal Reserve raises interest rates. Close economic observers like Goldman Sachs said just this week that recession odds are increasing, and Deutsche Bank recently predicted “an earlier and somewhat more severe recession” than previously anticipated.
Here’s a timeline of how Biden and his top officials have communicated about “the R word.”
April: Recession fears began to surface
In April, the chances of a downturn became tough to ignore. Early that month, former Treasury secretary Larry Summers contended that a U.S. recession was a more likely outcome over the next two years than the Federal Reserve’s goal of a so-called soft landing after it raised rates to tackle inflation.
Those comments prompted push-back from the White House, which also discounted Summers’ warnings about inflation in 2021.
“We have not made that projection from U.S. government economists that Larry Summers has made,” Psaki said on April 11.
At the end of the month, Biden acknowledged that “you’re always concerned about a recession.” Still, the president rejected the notion of a widespread fear among economists — contending that only “some are predicting there may be recession in 2023.”
May: Recession rumblings increase
Throughout May, Biden officials repeatedly stressed they were monitoring for a recession but didn’t foresee one coming soon. During a trip to Tokyo on May 23, Biden answered no to the question of whether a recession in the United States is inevitable.
“We have problems that the rest of the world has, but less consequential than the rest of the world has because of our internal growth and strength,” he said.
The message of American strength, relative to the rest of the world, would become an oft-repeated refrain from Biden and his aides. At the end of the month, on May 31, Biden’s top economic aide, Brian Deese, told Yahoo Finance: “There are always risks [of a recession] but what I can tell you is that we in the United States can attack this problem from a position of economic strength.”
“We’re confident that we’ve got a better position than anybody else,” added Deese, the director of Biden’s National Economic Council.
At the World Economic Forum on May 25, Commerce Secretary Gina Raimondo told Yahoo Finance that she wasn’t hearing recession fears “at all” during her conversations with CEOs in Davos.
“One executive I was just talking to said, it seems like people are trying to talk themselves into a recession, but there’s no evidence to suggest we should be worried about it,” she said.
June: ‘Not inevitable’
The recession conversation has only increased this month, with the White House acknowledging fears but contending that the U.S. isn’t necessarily doomed to endure a downturn.
Treasury Secretary Janet Yellen said during a New York Times event on June 9 that “there’s nothing to suggest a recession is in the works.”
Still, National Economic Council Deputy Director Bharat Ramamurti noted a few days later that the Russia-Ukraine conflict has fueled inflationary pressure both on energy and food prices.
“We think that we are well-positioned to handle what are, truthfully, a number of headwinds,” Ramamurti told Yahoo Finance on June 16, citing the Russia-Ukraine war as the key challenge.
Last weekend, a host of Biden aides fanned out across the Sunday shows to drive the message that a recession can be avoided. “I don’t think a recession is at all inevitable,” Yellen told ABC News’ “This Week.” Deese and Energy Secretary Jennifer Granholm offered up a similar message.
Meanwhile, Summers jumped back in the debate with an appearance on NBC’s “Meet the Press,” where he maintained that “the dominant probability would be that by the end of next year, we would be seeing a recession in the American economy.”
Biden followed up on Monday while talking to reporters in Delaware, saying that he had spoken to Summers about the possibility. The president again noted: “There’s nothing inevitable about a recession.”
Ben Werschkul is a writer and producer for Yahoo Finance in Washington, DC.
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