we have not seen mental health treated the same as many other medical ailments, and that's something the administration is working on because it is supposed to be law. congress is also working more on mental health care. this is a known issue and it is hard to know how much the federal government can do. by on the mental health parity issue. host: and the $6,000 deductible, looking for ways to lower that. guest: -- we had deductible and co-pays. if everything was free, people would overuse it. the problem is the skin in the game's arm and a leg. -- the game is a arm and a leg.

that is another issue that is being looked at and that is where the idea for a public option comes in. if you think there is agreement on some of these things, that is a bigger thing to be an agreement on. host: the podcast is what the health. you can find it on twitter. itannouncer: "washington journa" continues. host: karen petrou is joining us for a conversation on the economy, a member of the consulting firm, federal financial analytics, the author of "engine of inequality." she also penned "biden-nomics is an insult to those living paycheck to paycheck." the biden administration embracing that term on the campaign trail. so define that term right now as

you see it. guest: that was not my headline. i do not think it is an insult, i think it is a mistake. bidenomics is what the president wants to portray where the middle class is doing better. and i think that we do have a better economy than we feared we might after covid, but for most americans, the majority of americans, it is far from comfortable. it's very frightening. host: eugene robinson talks about biden nomex, -- bidenomics citing, some recent good economic news that the president has been talking. bidenomics appears to be working. inflation, a poison for any incoming president, down to 3% in june. that is a dramatic decline from the peak rate at 9.1% last year.

unemployment at a near 50 year low. the economy grew at a healthy 2.4% in the second quarter despite the federal reserve's interest rate hikes. why is that not good news? guest: there is another statistic in the new york times this morning that shows the president running barely neck and with donald trump. and one of the reasons for that is despite the aggregate numbers, and those are all great numbers -- i do not contest those numbers -- this is an unequal economy and averages, such as the unemployment rate and inflation, do not represent the way that most people live. two thirds of americans skip purchases they want to because of inflation. 58% of americans are living paycheck-to-paycheck. and even with inflation slowing,

remember it is not down, it is slowing -- it costs $122 today to buy what cost $100 at the end of 2019. and pay has not kept up. so, american families are still having a lot of trouble. and all the financial anxiety shows that. people are worried. host: if the perception of the economy was the lagging indicator, that with the good numbers, that that confidence in the economy will be going up, is that how we usually read economic numbers? guest: these numbers are averages. and they are aggregates. they really do not represent america as a whole. they are helpful to understanding the economy. they are not great guides to politics. and that is my concern. not that the economy is going to

slide into a recession, although we have significant recession risk. we are not out of harm's way. that could be a danger. the lagging indicator is monetary policy. we have not seen the full effect of the tightening. and we are not far from the potential for significant slowdown, if not recession, so there are a lot of booby-traps. host: there is more concern about a looming or almost certain recession -- was more concern about a looming or almost certain recession last year, but it seems to be cooling. guest: because of the numbers, but we have warnings. the monetary policy takes a wild to work. there is concern the fed's policy, they raised rates again last week, have yet to cool off the economy because it takes time to happen. when it does, when the high rates do what they are intended, the economy will slow.

and we are seeing a lot of struggle in the data. yet, there is no room for error here. and you have that many people living paycheck-to-paycheck. americans took out $5.5 trillion of their excess savings, many people put in the bank after covid with all the government support, that is gone. now we have to repay student loans, that is $100 billion a year out of households. my concern is we are not out of the woods. the more the president says look how good you have it, and most americans do not have it that good, they will do what they did in 2016 -- voters stayed home and the lower income households voted for donald trump. host: karen petrou is our guest. bidenomics is our topic, and public opinion about bidenomics.

you have heard it the president talk about it on the campaign trail. you are reading about the term more. one more headline from the wall street journal, "i would not bet the farm on bidenomics." blake hearst is the author. a soybean farmer. we want to hear your thoughts on bidenomics, is the economy working for you? the president has been embracing the term. republicans at 202-748-8001. it democrats at 202-748-8000. independents at 202-748-8002. karen petrou from federal financial analytics, the cofounder and managing partner there. what is your mission? guest: it has nothing to do with any of this. we are a financial services company with complicated rules and regulations. this is just me talking, because i am so worried about the next

election and how these kinds of numbers, like bidenomics they, leave so many americans behind. host: how would you advise the white house, if you are invited, on how to talk about the economy? guest: you cannot just say my program is for the middle class, he has to talk about the great things. it will take time, but the infrastructure spending, rebuilding america's manufacturing base, that is great news for low-wage workers. there is a lot to talk about there. he is doing some of that but people are not feeling it in their pocketbooks. he shouldn't say how good people have it, but how well the economy is working as a platform for growth. try to persuade people he really cares about those who are having a tough time. host: how did you think about

make america great again as an economic message for people you are talking about, the lower income workers, middle wage workers? guest: i have no idea what that means anymore. it doesn't -- does it mean anti-immigration, an economic method? from an economic perspective, i think what donald trump actually did was make america more equal because of the tax cuts in 2017 which gave more to the wealthy, but he persuaded people he cares about them. i do not know if his record has evident of any fact he does. his problem is he is not the greatest orator. he has difficulty persuading people that he feels how they feel, the current president. host: loretta out of cleveland, ohio on the line free democrats. good morning. caller: good morning. good morning, karen. i understand your point of view,

but i think that it is a bit misrepresented. [coughing] excuse me. my coffee went the wrong way. host: how do you think it is misrepresented? caller: because jay powell gave donald trump four years of dear percent interest rates and then we find out that -- eight person -- 0% interest rate and he spent $8 billion. then he gave tax cuts on top of that. he gave farmers $20 billion. and donald trump gave away so much money, that steven mnuchin got out the door with $555 billion. see?

and they want to talk about biden spending money. build back better was cheaper than what trump ended up spending. and he had spent that $8 billion before covid struck. guest: you are right about the 0% interest rates. that was toward the end of obama , most of the trump period, and president biden until march of last year. very low rates have helped to make america far more unequal, because when you have zero rates, and negative, you are still losing 2% when you put money in the bank. and most americans have never been able to save. and most, when they have extra

money, they put it in the bank, so they have been losing out while the wealthy have put it in the stock market and they have done quite well. it has made america unequal and unproductive. host: mark is an independent. good morning. caller: thank you for taking my call. bidenomics, it is not working for me. i look at things like gas prices, they are on the rise now. we are quickly approaching $4 a gallon in missouri and it is expected to go above $5. the prices at the grocery store are through the roof. and bidenomics is not helping me. the interest rates, they continue to climb, which makes it harder for me to buy a car, house or use my credit. to get the things i need.

quite frankly, part of the problem is the mainstream media. it seems as though they are in the pocket of the democrats, or in other words of democrats control the media and what the american people see and hear

host: what do you think about this term? >> hello, i have a different opinion than what karen has, i do agree that she is very knowledgeable about what's going on, but she made one, and it's not just her. i've heard from many people that the economy is doing good there are two thirds of the country still living to paycheck-to-paycheck. that isn't just something that happened under president biden. there are people that have been living that way for decades. and as prices went up over decades, wages did not. but, i have to say that, under president biden, it seems that more people are working better jobs for more wages than they have ever.

and there are more people working, so that tells me that what he is trying to do is somewhat working. but, as far as prices like groceries, i've noticed that, in my area, in kentucky, they have gone down. they are still way higher than they were before kobe, but they've gone down. and i think where they are at, they are going to stay there. i don't see groceries coming back down the way they were before. this is a trend that has happened over the years. prices have continued to go up over the years. this isn't new, and once though -- they raise those prices, they very seldom bring them back down. guest: that's true, this will be sticky inflation. i don't disagree with you, none

of this is new. that's why i wrote a book that was published in 2021 and i rode a couple of years before that called engine inequalities, the betterment of wealth in america. this has been going on for a while. president biden is trying very hard to fix it and they give him a lot of credit for that and he is launching balloons over an economy that i'm really glad to hear that you find is working better for you. but you have half of american millennials reporting and the economic services that they are under or unemployed, even at current employment levels. that's partly because people, particularly women are in the workforce because things like the cost of childcare have gone up and they can't find jobs that

make it worthwhile to leave home so families are struggling. it's better, and the data on aggregate are good, but that is not a good place the way the fed likes to describe the economy. for all of the top 10, maybe 5%, most americans are having a tough time. host: we hear about supply chain and supply chain impacts on inflation, i wonder your thoughts on this news from yesterday, the trucking company yellow is filing for bankruptcy according to the teamsters yesterday. it arrived three years after yellow formerly known as wire sea worldwide receive $700 million in pandemic loans and federal government. the 99-year-old tennessee-based company at 30 -- had 30,000 employees across the country as of the end of the year. that news coming this week where we will see another employment report come friday. guest: that's the story of

private equity ownership, we will see a lot more of this because a lot of the companies took out in norma's debt with zero interest rate and it's starting to roll over now. as the loans come due, loans that were 0% are now going to cost higher risk companies 7% and 8% in a lot of these companies allowing this case, notwithstanding, can't afford to make these payments. it will be a slow burn, not a fast catastrophe. host: good morning. caller: good morning. it's a joke, it's a real joke, i can't believe that he's even doing that, but then again, he doesn't even know where he's at half the time. first of all, the low unemployment rate that he's bragging about, that we seem to

forget that during covid, a whole lot of baby boomers retired early, got out of the workforce, so they aren't even part of the unemployment anymore. where i work we had three people that could've worked a couple more years, but then it, they said -- set in kazan retired early. that's why they're such a demand for all of these jobs and these people that were 20, 30 years, they left the workforce permanently. of course, the company has to pay more money to get people, what the people are getting aren't really all that experienced and we are having that problem where we were. as far as the inflation in wages going up, when you adjust the real wage growth with inflation, it has actually gone down.

as far as the tax breaks, bidens bringing back jobs, he brags about creating 20 million jobs, these jobs were one that were affected during covid, and then people were just coming back to work. it's not anything he created. host: you bring up a lot of issues, let her jump in on a few of those. guest: i think he did bring up a lot of issues. employment data are notoriously really difficult. it's one of the reasons i go back to how do people feel about their jobs, are they in the workforce, out of the workforce, we know the labor participation rate is about two thirds of people who want to work. you should have a lot of people who want to work not being able to find jobs for which they are able to find her which they are paid enough. real wages have finally gone up

just a little bit in the last quarter or two, but you are absolutely right. middle-class wages have been stagnant since the year 2000, and that's a problem. host: coming back to the jobs report, we saw july report for the june numbers, 209,000 jobs added in june. the unemployment rate didn't change much. what your expectation for friday? guest: i'm not an economist, i just talk like one on tv. i am a financial analyst, i just care a lot about this because i really do care about how the economy functions for the majority of america. that's why i wrote engine of equality because it just bothers me so much. i think we would still have a strong report. weekly numbers are useful, but they are still snapshots. you have to look at the trends. and the risks is, the fed is

tightening hard, and squeezing in is just starting to see some of the air come out of the balloon. but we are going to see more, so you will see slowing and then potentially problematic job numbers. host: engine of inequality is the book -- guest: that's the economy that makes sense if you have a country with the majority of americans have a middle class. we used to have a middle class and economic theory the bell curve. 20% of 60%, 70% of americans

are doing fine. now we have in the economy the top 1% wages, income, $2 million , and they make more money than the bottom 90%. wages are 50% lower in america are $35,000 a year. so the economy functions really differently for the 90% of americans who don't have anything extra. host: line for republicans, good morning. caller: thank you for having me on. i have a wonderful appreciation of the lady. i have a question for her. during the eisenhower dust during the eisenhower administration, it was a balanced budget.

no we have children who demand high wages when they haven't even done the apprenticeship. and then we have corporate people that know how to move the money. so, do the rich oppress the poor or not? i would like to hear from her on that. guest: thank you, michael. for your views. i think it's complicated. you make a good point about the balanced budget and we have a big balanced deficit. but covid was a real close call. we as a country, both president trump, you remember the c.a.r.e.s. act, threw huge amounts of money including a bailout for a huge trucking company authorized by president trump 2020. and now, we have i think for better structured infrastructure spending programs. we have a huge problem in this country with biomedical research.

you have the research triangle in north carolina. there is a phenomenal startups, i know some great biomedical research, and because the market , with interest rates going up, it is really hard to find money for those companies, they are really struggling. so the more that government can do to support urgent need like biomedical research, the better it is for the country, and the better it will be to get people back into the workforce with the jobs they want. host: if you are on twitter writes, if congress cared about wage growth, they would raise the minimum wage from seven point $25 an hour. guest: i think so. it is a poverty wage. it is really minimum. i don't know any part of the country in which somebody could work 40 or even 50 hours a week is hard as he or she could and be able to support children in any humane way of life at $7.25

an hour. host: next caller please. caller: hey, karen. you have some interesting points. i appreciate listening to you. i have a couple of things on jay powell. it's kinda funny. it seems like he is using 1970's economics to run today's day and age, you know, let's lay people off, this and that. it's really not working because you still have 12 million people out of the workforce, his unemployment is low and there has been a lot of layoffs. but all he is doing is putting hardship on the american people with the raising of the interest rates. granted inflation has come down a little bit, but overall, the economy is still really, really hurting. and he needs to rethink how he is doing it. only other comment is on the yellow tracking.

that is a union thing. the unions are pushing the yellow tracking out of the industry, asking for outrageous things in an industry that we really need which is trucking. we have already, 80,000 down and we will chart around and cut that company. i want to hear karen's feedback on that. thanks. guest: i have to say, you know more about trucking than i do. i would listen to your feedback on that. let me go back to what you said about jay powell. he means really well. he is actually honorable person. the problem, i think, is institutional. the fed has a long-standing view that if financial markets do well, that will trickle down into the economy and do well for people, and it doesn't. that is in 1970's view. it used to be true. we have seen over the past 15 years -- this is not on biden, i just don't want him taking credit for this economy, he

didn't do it. we have seen the stock market and financial markets go up, up and away. that is one of the reasons wealthy people are so rich. it doesn't trickle down. in this economy, the financial economy is not the real economy. once it was. now, it is not. host: talking about jay powell, wednesday last week, the fed talking about its revised economic forecast. this is about a minute and a half of chair powell. [video clip] paola: it has been my view consistently that we do have a shot. my base case is we will be able to achieve inflation moving back down to our target without the significant downturn that results in high levels of job losses that we have seen in some past instances, many past instances of tightening that look like ours. that has been my view that that is true. i think that is consistent with

what i see today. but it is a long way from assured. we have a lot left to go to see that happen. the staff now has a noticeable slowdown in growth starting later this year in the forecast, but given the resilience of the economy recently, they are no longer forecasting for reception. i just want to note, the staff produces its own forecast which is independent of the forecasts which we as fomc participants produce. having an independent staff forecast as well as the individual participant forecast, is really the strength of our process. there's just a lot of i think constructive diversity of opinion that helps us make -- informs our deliberations, helps us make, i hope, better decisions. reporter: is the reason for optimism that inflation has come down and you still have a strong labor market? does that add to the optimism?

chairman powell: i would not use the word optimism about this yet, i would say there is a pathway. yes, that is a good way to think about it. we have seen so far the beginnings of this information without -- beginnings of disinflation without any cost to the labor market. that is a good thing. host: federal reserve chairman jay powell there, last wednesday. a lot of economic jargon as always in those press conferences. what did you take away from that guest: that the fed staff, as the chairman said, doesn't forecast a recession. that is good. there are a lot of them. they also did not forecast inflation. in 2021 when it started to pick up, you will recall the fed said inflation was transitory. it was not. they know you could have called that. i actually had an op-ed in the papers in june of 2021 saying this is not going to be

transitory. i don't have 300 economists working for me, so i know the fed can call things better. i am glad -- they don't want to say they are optimistic, but they don't think there is a recession. they are optimistic, and i hope they are right, but i can't say i am sure they are. they are mostly not. host: reno, nevada, karen, independent. good morning. caller: i noticed right when the covid was getting over with, it was in the newspapers and it was put out by the oil companies, exxon and them, and they said that through covid, they hadn't made money. they said that they were going to put gasoline at $5.25 a gallon. now, assad then, after that, people were blaming biden, they were blaming him for the economy and everything, but when they

increased that to $5.25, that put groceries -- because the truckers and everything else , to get their items on the market, groceries and everything. i think that is what has caused a lot of the inflation. when they put it out at five dollars 25 cents a gallon. i know a lot of people didn't see that in the newspaper, but it was in the newspaper. guest: petroleum prices are a real problem for everyday living. they are not set by the white house, not even by the oil companies, they are set by forces including opec and saudi arabia and russia and the oil-producing nations, as well as by oil and gas producers in the united states. they have a role, big companies here have a role in the pricing, but it is a global price instrument.

host: in kentucky, republican, good morning. caller: good morning. host: go ahead. caller: hi, karen. i have a few questions for you. you said people are making it and that the pay rate is going up. i am telling you from my perspective, you go to the groceries and you can barely get two bags and it will be $100. we need help on groceries. my family does work. we are not on food stamps. we couldn't get them if we wanted to. somebody still has to make a move. i agree with the other guy, biden don't even know who he is. he got somebody else doing the work. if somebody else is doing that work -- at least from got it done. let trump back in because he will not have somebody working for him. host: karen?

guest: i have to say, i think donald trump has many people working for him. lawyers, most included. [laughs] host: democrats on capitol hill during last year and as inflation has crept up, often pointed to corporations, in their prices to create record profits. how much of an impact to think that had on the inflation problem in this country? guest: the data don't support most of that. there are some instances of that in which companies are sustaining profitability even as their cost of doing business has gone down, but in general, and i have seen a number of surveys on this, the data support essentially companies, as their past of goods inflation and raw materials went up, particularly in the course of the worst of the ukraine crisis with the energy, and the global food

market disruptions, as those continued a little bit out of the news and they were less dramatic -- at least they were until a couple of weeks ago, food prices come down a bit in some places. is that a major cause of inflation? i don't think so. >> if i could take a moment to just ask you all to silence your cell phones, mute your laptops, anything that makes noise, that would be helpful. in a few moments i expect special counsel jack smith to come to this podium and make a statement of about two minutes in length. he will not take questions. if you have any questions after the press conference is over, please see me on the site. any questions? don't do it. all right, thank you.