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    Biden and Harris meet with labor organizers from Amazon and Starbucks.

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    President Biden, Vice President Kamala Harris and Labor Secretary Martin J. Walsh met Thursday at the White House with several union organizers involved in successful campaigns at companies including Amazon and Starbucks.The meeting was intended to discuss how the recent organizing successes can inspire other workers to join or form a union, according to the White House.Alex Speidel, an employee and union leader at Paizo, a publisher of role-playing games in the Seattle area, said the administration officials “were interested in hearing about how we had been successful — what things we had done to motivate people without the union history in their families, first-time union joiners.”A high-profile White House event focused primarily on rank-and-file union members and grassroots organizers is unusual for a president of either party. But a task force on worker organizing led by Ms. Harris, which officially organized Thursday’s meeting, has met with workers outside the White House on several occasions, and rank-and-file union members have attended White House events under Mr. Biden. There have also been White House meetings with labor leaders and senior labor officials.Christian Smalls, president of the Amazon Labor Union, asked Mr. Biden to press Amazon’s leadership to recognize the union and to begin collective bargaining, and Mr. Biden expressed general support in response, according to Mr. Speidel and another attendee, Jaimie Caldwell, a librarian at the Baltimore County Public Library in Maryland. A White House spokeswoman said it was up to the National Labor Relations Board, an independent agency, to certify unions. She also pointed to earlier remarks by Jen Psaki, the White House press secretary, noting that President Biden is a longtime advocate “for collective bargaining, for the rights of workers to organize, and their decision to do exactly that” in the case of Amazon.The meeting comes at a time when union organizers have won several high-profile elections, including more than 50 at Starbucks locations and at the Staten Island warehouse where Mr. Smalls led a unionization effort.In addition to union leaders and workers from Amazon, Starbucks, Paizo and the Baltimore County Public Library, the meeting included workers from the outdoor apparel retailer REI and the animation production company Titmouse.Labor leaders often describe Mr. Biden as the most pro-labor president of their lifetimes, pointing to his replacement of government officials they disliked with those more sympathetic to unions, and to the undoing of Trump-era rules that weakened worker protections.During a high-profile union campaign at Amazon last year, Mr. Biden warned that “there should be no intimidation, no coercion, no threats, no anti-union propaganda,” and he later criticized Kellogg for its plans to permanently replace striking workers during a labor dispute. Both were unusual interjections by a sitting president. More

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    Biden Administration Plays Down Growth Decline in G.D.P. Report

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    The White House dismissed a slump in first-quarter growth that was driven by a quirk in inventories and a jump in imports, emphasizing that Thursday’s report on gross domestic product also pointed to underlying strength in consumer spending.G.D.P. declined 0.4 percent in the first quarter after adjusting for inflation, or 1.4 percent on an annualized basis, the Commerce Department said Thursday. Companies had stockpiled inventories in the fourth quarter and built them more slowly at the start of the year, and imports far outstripped exports as Americans bought goods from abroad, driving the decline.“While last quarter’s growth estimate was affected by technical factors, the United States confronts the challenges of Covid-19 around the world, Putin’s unprovoked invasion of Ukraine, and global inflation from a position of strength,” President Biden said in a statement following the release, referring to President Vladimir V. Putin of Russia. Mr. Biden also noted that “consumer spending, business investment, and residential investment increased at strong rates.”Mr. Biden and Democrats are facing a challenging midterm election year as inflation runs at its fastest pace in four decades, chipping away at household budgets and eroding consumer confidence. At the same time, the Federal Reserve is raising interest rates to try to keep rapid price increases from becoming permanent, which could begin to meaningfully cool down the economy just as voters head to the polls.The administration has tried to pin high inflation on Russia’s invasion of Ukraine. While the war has pushed gas and other commodity prices higher, inflation was high even before Russia’s attack.Republicans have seized on rising prices to blast Mr. Biden’s economic policies. The decline in growth at the start of the year gave them room to ramp up that criticism.“Accelerating inflation, a worker crisis, and the growing risk of a significant recession are the signature economic failures of the Biden administration,” Representative Kevin Brady, a Texas Republican, said in a news release on Thursday.Representative Kevin McCarthy of California, the House Republican leader, also blamed Democrats for the drop in growth and 40-year high inflation levels.“In 15 months, one-party Democrat rule has squandered America’s recovery and left you paying the price,” Mr. McCarthy wrote on Twitter.The Biden administration’s 2021 economic stimulus, which sent checks to households and provided other relief at a time when the job market was already recovering, has been criticized by economists for helping to stoke excessively strong consumer demand. That probably ramped up inflationary pressures as the economy reopened, some research has suggested.Republicans often seize on that to argue that the burst in inflation is the administration’s fault. But administration officials point out that their policies helped to drive a swift recovery, came at an uncertain moment, and built on a pandemic response started under the Trump administration.In a speech on Thursday, Treasury Secretary Janet L. Yellen defended the scale of the efforts to support the economy. She recalled the dire economic projections in the early days of the pandemic and said that the spending was needed to avert a worst-case scenario, though some economists warned that the final installation in 2021 was too much and too poorly targeted even at the time of its passage.“Throughout 2020, and into 2021, the path of the pandemic, including its severity and the role of future viral strains could not be predicted,” Ms. Yellen said at an event at the Brookings Institution held by the Hamilton Project and Hutchins Center. “Given this uncertainty, the recovery packages sought to protect against tail risk.” More

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    Trump Officials Gave Pandemic Loan to Trucking Company Despite Objections

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    WASHINGTON — Democratic lawmakers on Wednesday released a report alleging that top Trump administration officials had awarded a $700 million pandemic relief loan to a struggling trucking company in 2020 over the objections of career officials at the Defense Department.The report, released by the Democratic staff of the House Select Subcommittee on the Coronavirus Crisis, describes the role of corporate lobbyists during the early months of the pandemic in helping to secure government funds as trillions of dollars of relief money were being pumped into the economy. It also suggests that senior officials such as Steven Mnuchin, the former Treasury secretary, and Mark T. Esper, the former defense secretary, intervened to ensure that the trucking company, Yellow Corporation, received special treatment despite concerns about its eligibility to receive relief funds.“Today’s select subcommittee staff report reveals yet another example of the Trump administration disregarding their obligation to be responsible stewards of taxpayer dollars,” Representative James E. Clyburn of South Carolina, the Democratic chairman of the subcommittee, said in a statement. “Political appointees risked hundreds of millions of dollars in public funds against the recommendations of career D.O.D. officials and in clear disregard of provisions of the CARES Act intended to protect national security and American taxpayers.”The $2.2 trillion pandemic relief package that Congress passed in 2020 included a $17 billion pot of money set up by Congress and controlled by the Treasury Department to assist companies that were considered critical to national security. In July 2020, the Treasury Department announced it was giving a $700 million loan to the trucking company YRC Worldwide, which has since changed its name to Yellow.Lobbyists for Yellow had been in close touch with White House officials throughout the loan process and had discussed how the company employs Teamsters as its drivers, according to the report.Mark Meadows, the White House chief of staff, was a “key actor” coordinating with Yellow’s lobbyists, according to correspondences that the committee obtained. The report also noted that the White House’s political operation was “almost giddy” in its effort to assist with the application.The loan raised immediate questions from watchdog groups because of the company’s close ties to the Trump administration and because it had faced years of financial and legal turmoil. The firm had lost more than $100 million in 2019 and was being sued by the Justice Department over claims that it had defrauded the federal government for a seven-year period. It recently agreed to pay $6.85 million to resolve allegations “that they knowingly presented false claims to the U.S. Department of Defense by systematically overcharging for freight carrier services and making false statements to hide their misconduct.”To qualify for a national security loan, a company needed certification by the Defense Department.According to the report, defense officials had recommended against certification because of the accusations that the company had overcharged the government. They also noted that the work that the company had been doing for the federal government — which included shipping meal kits, protective equipment and other supplies to military bases — could be replaced by other trucking firms.But the day after a defense official notified a Treasury official that the company would not be certified, one of Mr. Mnuchin’s aides set up a telephone call between him and Mr. Esper.The report indicated that Mr. Esper was not initially familiar with the status of Yellow’s certification. Before the call, aides prepared a summary of the analysis and recommendations of the department’s career officials that concluded that the certification should be rejected. Before those reached Mr. Esper, Ellen M. Lord, the department’s under secretary for acquisition and sustainment who was appointed by Mr. Trump, intervened and requested a new set of talking points that argued that the company should receive the financial support “to both support force readiness and national economic security.” Ms. Lord could not immediately be reached for comment.After the call with Mr. Mnuchin, Mr. Esper certified that the company was critical to national security, and a week later the approval of the loan was announced.Mr. Mnuchin then sent an email to Mr. Meadows that included news reports praising the loan. He highlighted positive comments from James P. Hoffa, the longtime president of the Teamsters union, who according to documents in the report made a direct plea to President Donald J. Trump about the loan.Mr. Esper and Mr. Mnuchin declined to comment. A former Treasury official familiar with the process said the loan saved 25,000 union jobs during an economic crisis and prevented disruption to the national supply chain that the Defense Department, businesses and consumers had depended on. The former official said that because of the terms of the loan, taxpayers were profiting from the agreement.A spokesman for Mr. Esper said that the company met the criteria to be eligible for the loan and emphasized that the report made clear that senior staff at the Defense Department recommended that he certify it. The Treasury Department made the final decision to issue the loan, the spokesman added.The Trump InvestigationsCard 1 of 6Numerous inquiries. More

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    Biden to Nominate Michael Barr as Fed Vice Chair for Supervision

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    The Biden administration said on Friday that it intended to nominate Michael S. Barr, a law professor and a former Obama administration official, to be the Federal Reserve’s vice chair for supervision.The position — one of America’s top financial regulatory spots — has proved to be a particularly thorny one to fill.The administration’s initial nominee, Sarah Bloom Raskin, failed to win Senate confirmation after Republicans took issue with her writing on climate-related financial oversight and seized on her limited answers about her private-sector work. Senator Joe Manchin III, Democrat of West Virginia, joined Republicans in deciding not to support her, ending her chances.Mr. Barr, the dean of the University of Michigan’s public policy school, could also face challenges in securing widespread support. He was a leading contender to be nominated as comptroller of the currency but ran into opposition from progressive Democrats.Some of the complaints centered on his work in government: As a Treasury Department official during the Obama administration, Mr. Barr played a major role in putting together the Dodd-Frank Act, which revamped financial regulation after the 2008 financial crisis. But some said he opposed some especially stringent measures for big banks.Other opponents when his name was floated for that post focused on his private-sector work with the financial technology and cryptocurrency industry.But President Biden described Mr. Barr as a qualified candidate who would bring years of experience to the job.“Barr has strong support from across the political spectrum,” the president said in a statement announcing the decision. He noted that Mr. Barr had been confirmed to his Treasury post “on a bipartisan basis.”Senator Sherrod Brown, the Ohio Democrat who chairs the Senate Banking Committee, said in a statement, “I will support this key nominee, and I strongly urge my Republican colleagues to abandon their old playbook of personal attacks and demagoguery.”Ian Katz, managing director at the research and advisory firm Capital Alpha, put Mr. Barr’s chance of confirmation at 60 percent. “Barr is seen by many as more moderate than Sarah Bloom Raskin,” Mr. Katz wrote in a note ahead of the announcement but after speculation that Mr. Barr might be chosen.Mr. Barr completes Mr. Biden’s slate of candidates for the central bank’s five open positions.The other picks — Jerome H. Powell for another term as Fed chair, Lael Brainard for vice chair, and Lisa D. Cook and Philip N. Jefferson for seats on the Board of Governors — await confirmation. Those nominations have gotten past the Senate Banking Committee, the first step toward confirmation, and a vote before the full Senate is expected in the coming weeks.Mr. Biden said he would work with the committee to get Mr. Barr through his first vote quickly, and he called for swift confirmation of the others. More

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    Supply Chain Hurdles Will Outlast Covid Pandemic, White House Says

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    The administration’s economic advisers see climate change and other factors complicating global trade patterns for years to come.The coronavirus pandemic and its ripple effects have snarled supply chains around the world, contributing to shipping backlogs, product shortages and the fastest inflation in decades.But in a report released Thursday, White House economists argue that while the pandemic exposed vulnerabilities in the supply chain, it didn’t create them — and they warned that the problems won’t go away when the pandemic ends.“Though modern supply chains have driven down consumer prices for many goods, they can also easily break,” the Council of Economic Advisers wrote. Climate change, and the increasing frequency of natural disasters that comes with it, will make future disruptions inevitable, the group said.White House economists analyzed the supply chain as part of the Economic Report of the President. The annual document, which this year runs more than 400 pages, typically offers few new policy proposals, but it outlines the administration’s thinking on key economic issues facing the country, and on how the president hopes to address them.This year’s report focuses on the role of government in the economy, and calls for the government to do more to combat slowing productivity growth, declining labor force participation, rising inequality and other trends that long predated the pandemic.Understand Inflation in the U.S.Inflation 101: What is inflation, why is it up and whom does it hurt? Our guide explains it all.Your Questions, Answered: Times readers sent us their questions about rising prices. Top experts and economists weighed in.Interest Rates: As it seeks to curb inflation, the Federal Reserve announced that it was raising interest rates for the first time since 2018.How Americans Feel: We asked 2,200 people where they’ve noticed inflation. Many mentioned basic necessities, like food and gas.Supply Chain’s Role: A key factor in rising inflation is the continuing turmoil in the global supply chain. Here’s how the crisis unfolded.“The U.S. is among and remains one of the strongest economies in the world, but if we look at trends over the last several decades, some of those trends threaten to undermine that standing,” Cecilia Rouse, chair of the Council of Economic Advisers, said in an interview. The problem is in part that “the public sector has retreated from its role.”The report dedicates one of its seven chapters to supply chains, noting that the once-esoteric subject “entered dinner-table conversations” in 2021. In recent decades, Ms. Rouse and the report’s other authors write, U.S. manufacturers have increasingly relied on parts produced in low-cost countries, especially China, a practice known as offshoring. At the same time, companies have adopted just-in-time production strategies that minimize the parts and materials they keep in inventory.The result, the authors argue, are supply chains that are efficient but brittle — vulnerable to breaking down in the face of a pandemic, a war or a natural disaster.“Because of outsourcing, offshoring and insufficient investment in resilience, many supply chains have become complex and fragile,” they write, adding: “This evolution has also been driven by shortsighted assumptions about cost reduction that have ignored important costs that are hard to turn into financial measures, or that spilled over to affect others.”But some economists noted that making supply chains more resilient could carry its own costs, making products more expensive when inflation is already a major concern.Adam S. Posen, the president of the Peterson Institute for International Economics in Washington, said the pandemic and Russia’s invasion of Ukraine might lead companies to locate at least some of their supply chains in places that were more politically stable and less strategically vulnerable. But pushing companies to duplicate production could waste taxpayer dollars and introduce inefficiencies, raising prices for consumers and lowering growth.“At best you’re paying an insurance premium,” he said. “At worst you’re doing something for completely political reasons that’s very economically inefficient.”Other economists have emphasized that global supply chains are not always a source of fragility — sometimes they can be a source of resilience, too.Inflation F.A.Q.Card 1 of 6What is inflation? More

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    Biden to Allow Higher-Ethanol E15 Gas to Be Sold All Summer

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    WASHINGTON — President Biden announced on Tuesday a plan to suspend a ban on summertime sales of higher-ethanol gasoline blends, a move that White House officials said was aimed at reducing gas prices but that energy experts predicted would have only a marginal impact at the pump.The Environmental Protection Agency will issue a waiver that would allow the blend known as E15 — which is made of 15 percent ethanol — to be used between June 1 and Sept. 15. The White House estimated that approximately 2,300 stations in the country offer the blend and cast the decision as a move toward “energy independence.”“E15 is about 10 cents a gallon cheaper,” Mr. Biden said, speaking after taking a tour of a production facility that produces 150 million gallons of bioethanol annually. “And some gas stations offer an even bigger discount than that.”“When you have a choice, you have competition,” Mr. Biden added. “When you have competition, you have better prices.”The decision to lift the summertime ban comes as Mr. Biden faces growing pressure to bring down energy prices, which helped drive the fastest rate of inflation since 1981 in March. A gallon of gas was averaging $4.10 on Tuesday, according to AAA. Last month, the president announced a plan to release one million barrels of oil a day from the U.S. Strategic Petroleum Reserve over the next six months.Understand Inflation in the U.S.Inflation 101: What is inflation, why is it up and whom does it hurt? Our guide explains it all.Your Questions, Answered: Times readers sent us their questions about rising prices. Top experts and economists weighed in.Interest Rates: As it seeks to curb inflation, the Federal Reserve announced that it was raising interest rates for the first time since 2018.How Americans Feel: We asked 2,200 people where they’ve noticed inflation. Many mentioned basic necessities, like food and gas.Supply Chain’s Role: A key factor in rising inflation is the continuing turmoil in the global supply chain. Here’s how the crisis unfolded.Ethanol is made from corn and other crops and has been mixed into some types of gasoline for years as a way to reduce reliance on oil. But the blend’s higher volatility can contribute to smog in warmer weather. For that reason, environmental groups have traditionally objected to lifting the summertime ban, as have oil companies, which fear greater use of ethanol will cut into their sales.How much the presence of ethanol holds down fuel prices has been a subject of debate among economists. Some experts said the decision was likely to reap larger political benefits than financial ones.“This is still very very small compared with the strategic petroleum reserve release,” said David Victor, a climate policy expert at the University of California, San Diego. “This one is much more of a transparently political move.”Lawmakers in corn-producing states have been urging Mr. Biden to use biofuels to fill the gap created by the United States ban on importing Russian oil. Oil refiners are required to blend some ethanol into gasoline under a pair of laws, passed in 2005 and 2007, intended to reduce the use of oil and the creation of greenhouse gases by mandating increased levels of ethanol in the nation’s fuel mix every year. However, since passage of the 2007 law, the mandate has been met with criticism that it has contributed to increased fuel prices and has done little to reduce greenhouse gas pollution.Inflation F.A.Q.Card 1 of 6What is inflation? More

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    Treasury Aims for Economic Pain on Russia, but Critics Question Effectiveness

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    The Treasury Department’s deputy secretary, Wally Adeyemo, has been leading the effort to crack down on evasion and to coordinate with Europe.WASHINGTON — When Russia imposed retaliatory sanctions on top American officials last month, its government targeted President Biden and his top national security advisers, along with Wally Adeyemo, the deputy Treasury secretary, whose agency has been crafting the punitive measures aimed at crippling Russia’s economy.Russia’s move, while wholly symbolic, underscored the central role that the Treasury Department has been playing in designing and enforcing the most expansive financial restrictions that the United States has ever imposed on a major economic power.Those restrictions amount to an economic war against Russia, which is entering a critical phase as the toll of fighting in Ukraine continues to escalate and as the Russian government tries to find ways to evade or mitigate fallout from Western sanctions.In an attempt to prevent Russia from skirting the penalties, Mr. Adeyemo, a 40-year-old former Obama administration official, spent last week crisscrossing Europe to coordinate a crackdown on Russia’s evasion tactics and to plot future sanctions. In meetings with counterparts, Mr. Adeyemo discussed plans by European governments to target the supply chains of Russian defense companies, some of which the U.S. placed under sanctions last week, and he talked about ways the United States could help provide more energy to Europe so European countries could scale back purchases of Russian oil and gas, a Treasury official said.On Wednesday, five days after Mr. Adeyemo returned, the Biden administration announced additional sanctions on Russian banks, state-owned enterprises and the adult daughters of President Vladimir V. Putin.Still, it remains to be seen whether the sweeping penalties aimed at neutering Russia’s economic power are working.Over the past six weeks, the United States and its allies in Europe and Asia have imposed sanctions on large financial institutions in Russia, its central bank, its military-industrial supply chain and Mr. Putin’s allies, seizing their yachts and planes. Imports of Russian oil to the United States have been banned, and Europe is developing plans to wean itself off Russian gas and coal, albeit slowly. This week, the Treasury Department prohibited Russia from making sovereign debt payments with dollars held at American banks, potentially pushing Russia toward its first foreign currency debt default in a century.But thus far Russia has kept paying its debts. Currency controls imposed by Mr. Putin’s central bank, which restricted Russians from using rubles to buy dollars or other hard currencies, along with continuing energy exports to Europe and elsewhere have allowed the ruble to stabilize and are replenishing Russia’s coffers with more dollars and euros. That has raised questions about whether the measures have been effective.“I think we’re grappling with the aftershocks of the shock and awe of the sanctions that were put in place and the recognition that sanctions take time to fully impact an economy,” said Juan C. Zarate, a former assistant secretary of the Treasury for terrorist financing and financial crimes. “It’s asking too much of sanctions to actually turn back the tanks, especially when sanctions have been implemented after the invasion.”At a speech in London last week, Mr. Adeyemo promoted the ability of sanctions to change behavior, describing the measures as a part of the equation that adversaries such as Russia need to consider when they violate international norms.“The idea that you can violate the sovereignty of another country and enjoy the privileges of integration into the global economy is one our allies and partners will not tolerate,” Mr. Adeyemo said at Chatham House, a think tank.Yet even the United States, which is not reliant on Russian energy, has wrestled with how far to go with its penalties.Within the Treasury Department, officials have been in a debate about how far to push the sanctions without creating unintended consequences that would rattle the financial system and inflame inflation, which is soaring across much of the world.The impact on the U.S. economy has been a top priority, and Janet L. Yellen, the Treasury secretary, has expressed concern about measures that would amplify inflation. The sanctions on Russia have already led to higher prices for gasoline, and officials are wary that they could bring spikes in food and car prices as Russian wheat and mineral exports are disrupted.“Our goal from the outset has been to impose maximum pain on Russia, while to the best of our ability shielding the United States and our partners from undue economic harm,” Ms. Yellen told lawmakers on Wednesday.As officials considered how to target the ruble, Ms. Yellen, a former Federal Reserve chair, argued against just imposing a ban on foreign exchange transactions, which would prevent Russia from buying dollars. She suggested instead that immobilizing Russia’s foreign reserves — savings that are held in U.S. dollars, euros and other liquid assets — while creating exemptions for Russia to accept payment for certain energy transactions would be the most effective way to inflict pain on Russia’s economy while minimizing the impact on the United States and its allies.At a congressional hearing this week, Republicans criticized those carve-outs for being giant loopholes that allow Russia to earn hundreds of millions of dollars per day through oil and gas sales.Treasury Department officials have been tracking measures that Russia has been using to prop up its economy, such as buying stocks and bonds, and monitoring signs of a growing black market for rubles, which indicates the currency’s actual diminished value. The Biden administration has watched with concern as the value of the ruble has rebounded in recent weeks, undercutting pronouncements made by Mr. Biden that sanctions reduced the Russian currency to “rubble.”“Of course that means that, having said that, when the ruble rebounds for reasons that do not necessarily indicate weakness of sanctions, people will say, ‘Well, see, they failed,’” said Daniel Fried, a former U.S. ambassador to Poland and assistant secretary of state for Europe.A Treasury official said the United States was also keeping a private list of oligarchs whose financial transactions were under surveillance in preparation for sanctions so they could gain a better understanding of the networks of people that helped those individuals conceal their money. The United States has yet to impose sanctions on Roman Abramovich, a Russian billionaire who is already subject to European Union sanctions.Economists at the Institute of International Finance wrote in a research note this week that Russia’s domestic markets appeared to be stabilizing as a result of tight monetary policy, severe capital controls and its current account surplus.Russia-Ukraine War: Key DevelopmentsCard 1 of 4Missile attack. More

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    How Biden Is Handling Student Loan Payments Amid Inflation

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    The administration is in a tight spot as fast inflation makes households unhappy. Trying to offset price pain can risk stoking demand.President Biden, under fire for rapid inflation and looking for ways to help cushion rising costs for households, extended a moratorium on student debt payments through August. While politically popular with Mr. Biden’s party, the move drew criticism for adding a small measure of oomph to the very inflation the government is trying to tame.America’s robust economic recovery from the deepest pandemic-era lockdowns has left consumers with the power to spend and has fueled fast price increases. Those rising costs are making voters unhappy, jeopardizing Democrats’ chances of retaining control of Congress come November.The moratorium extension stood out as an example of a more general problem confronting the administration: Policies that help households stretch their budgets could soothe voters, but they could also add a little bit of fuel to the inflationary fire at an inopportune moment. And perhaps more critically, analysts said, they risk sending a signal that the administration is not focused on tackling price increases despite the president’s pledge to help bring costs down.Inflation is running at the fastest pace in 40 years and at more than three times the Federal Reserve’s 2 percent goal, as rapid buying collides with constrained supply chains, labor shortages and a limited supply of housing to push prices higher.The administration’s decision to extend the student loan moratorium through Aug. 31 will keep money in the hands of millions of consumers who can spend it, helping to sustain demand. While the effect on growth and inflation will most likely be very small — Goldman Sachs estimates that it probably adds about $5 billion per month to the economy — some researchers say it sends the wrong message and comes at a bad time. The economy is booming, jobs are plentiful and conditions seem ideal for transitioning borrowers back into repayment.“Four months by itself is not going to get you dramatic inflation,” Marc Goldwein of the Committee for a Responsible Federal Budget said, noting that a full-year moratorium would add only about 0.2 percentage points to inflation, by his estimate. (The White House estimates an even smaller number.) “But it’s four months, on top of four months before that.”Extra help for student loan borrowers could, at the margin, work at cross-purposes with the Fed’s recent policy changes, which are meant to take away household spending power and cool down demand.The Fed in March lifted interest rates for the first time since 2018, and it is expected to make an even larger increase in May as it tries to slow spending and give supply chains some breathing room. It is trying to weaken the economy just enough to put inflation and the economy on a sustainable path, without plunging it into a recession. If history is any guide, pulling that off will be a challenge.A chorus of economists took to Twitter to express frustration at the decision on Tuesday, when news of the administration’s plans broke.“Wherever one stands on student debt relief this approach is regressive, uncertainty creating, untargeted and inappropriate at a time when the economy is overheated,” wrote Lawrence H. Summers, a former Democratic Treasury secretary and economist at Harvard who has been warning about inflation risks for months. Douglas Holtz-Eakin, a former Congressional Budget Office director who now runs the American Action Forum, which describes itself as a center-right policy institute, summed it up thusly: “aaaaaaarrrrrrRRRRGGGGGGGGHHHHHHHH!!!!!!!!!!”Yet proponents of even stronger action argued that the moratorium was not enough — and that the affected student loans should be canceled altogether. Senators Chuck Schumer of New York, the Democratic leader, and Elizabeth Warren of Massachusetts are among the lawmakers who have repeatedly pressed Mr. Biden to wipe out up to $50,000 per borrower through an executive action.That stark divide underlines the tightrope the administration is walking as the Nov. 8 elections approach, with Democratic control of the House and the Senate hanging in balance.“They’re buying political time,” Sarah A. Binder, a political scientist at George Washington University, said in an email. “Kicking the can down the road — with another extension, surely, before the elections this fall — seems to be the politically optimal move.”The administration is taking a calculated risk when it comes to inflation: Student loan deferrals are unlikely to be a major factor that drives inflation higher this year, even if they do add a little extra juice to demand at the margin. At the same time, continuing the policy avoids a political brawl that could tarnish the administration and the Democratic Party’s reputation ahead of the November vote.White House officials emphasized on Wednesday that the small amount of money the deferrals were adding to the economy each month would have only a marginal impact on inflation. But they could help vulnerable households — including those that did not finish their degrees and that have worse job prospects.Delivering packages in New York. The robust economic recovery from pandemic-era lockdowns has left consumers with the power to spend and has fueled fast price increases.Gabby Jones for The New York Times“The impact of extending the pause on inflation is extremely negligible — you’d have to go to the third decimal place to find it, and if you did, it would be .001,” said Jared Bernstein, a member of the White House Council of Economic Advisers.The Federal Reserve Bank of New York suggested in recent research that some borrowers might struggle under the weight of payments and post a “meaningful rise” in delinquencies once payments start again. Mr. Biden referred to that Fed data during his announcement. The Education Department suggested that borrowers would be given a “fresh start” that will automatically eliminate delinquency and defaults and allow them to begin repayment, once it resumes, in good standing.Student Loans: Key Things to KnowCard 1 of 4Payments delayed again. More