As the U.S. struggles to deal with skyrocketing gasoline costs and inflation, President Joe Biden's administration is considering removing certain tariffs on China and possibly pausing the federal gas tax, according to two top officiaEs.
Jennifer Granholm, the Biden Administration's Energy Secretary, said the president was also considering pausing federal gas taxes as a way to cut costs.
Officials' views come as the Biden administration grapples with high inflation and record gasoline costs.
Loretta Mester, president of the Cleveland Federal Reserve Bank, predicted that inflation would take two years to reach the central bank's 2% target before gradually declining.
"President Biden will review tariff policy toward China," Janet Yellen said in an interview with ABC News on Sunday.
"We all recognise that China engages in a range of unfair trade practices that is important to address but the tariffs we inherited, some serve no strategic purpose and raise cost to consumers," she also said.
In the midst of a tense disagreement between the world's top economies, Biden announced that he is considering eliminating some tariffs placed by his predecessor on hundreds of millions of dollars of Chinese imports in 2018-2019.
Granholm told CNN that delaying the federal gasoline tax was not an option.
Granholm, Yellen, and Biden all agreed that a recession is "not inevitable," with the Treasury Secretary adding that labor markets and consumer spending are still healthy.
Yellen, on the other hand, called inflation "unacceptably high" and predicted that the economy would decline.
Chief executives, the Federal Reserve, and the Biden administration are all concerned about whether the United States, the world's largest economy, would enter a recession.
Former U.S. Treasury Secretary Lawrence Summers told NBC News that he disagreed with current officials' assessments and predicted a recession.
"The likelihood is that in order to do what's necessary to stop inflation, the Fed is going to raise interest rates enough that the economy will slip into recession," Summers stated on Sunday.
Inflation has turned virtually all Federal Reserve members into hawks, with only one voting against the central bank's highest rate hike in more than a quarter-century earlier this week.
According to Yellen, the job market was extraordinarily strong, possibly the strongest since World War II. While she predicted a slowdown in the economy, she admitted that inflation was unacceptably high.
Yellen told ABC News that the administration was examining its China tariff strategy, but she didn't give any details or say when a decision may be made.