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Biden admin finally admits it was 'wrong' about historic inflation a year too late, then clarifies

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Kevin Dietsch/Getty Images

President Biden's Treasury Secretary Janet Yellen admitted this week what has been plainly obvious to most Americans for the last 18 months: The Biden administration was wrong about seriousness of the nation's historic inflation crisis.

"I was wrong then about the path that inflation would take," Yellen told CNN's Wolf Blitzer on Tuesday. "As I mentioned, there have been unanticipated and large shocks to the economy that have boosted energy and food prices and supply bottlenecks that have affected our economy badly that I didn't — at the time — didn't fully understand, but we recognize that now."

Yellen's way-too-late admission came in response to a question from the CNN anchor about comments she made in 2021 in which she regarded rising inflation as only a "small risk."

President Biden and others in his administration, too, downplayed the crisis for months last year, insisting the steady rise in consumer goods was only "transitory" and unavoidable. The administration even went so far as to pitch the situation as preferable.

Officials characterized the problem as only a temporary consequence of the economy's recovery from the COVID-19 pandemic, as surging demand outstripped supply and the global supply chain suffered.

But Americans disagreed, as they saw inflation continue to skyrocket, eventually reaching levels not seen in 40 years. Economists pointed to the administration's exorbitant social spending as the primary culprit.

Finally, on Tuesday, it appeared the administration was ready to take some of the blame — but with caveats.

In a clarifying statement issued to CNN following the interview, a Yellen spokesperson attempted to reframe her boss' comments in a more politically advantageous light.

"The Secretary was pointing out that there have been shocks to the economy that have exacerbated inflationary pressures which couldn't have been foreseen 18 months ago, including Russia's decision to invade Ukraine, multiple successive variants of COVID, and lockdowns in China," the spokesperson said. "As she also noted, there has been historic growth and record job creation and our goal is now to transition to steady and stable growth as inflation is brought down."

Yellen's remarks came the same day that Biden met with her and Federal Reserve Chairman Jerome Powell in the Oval Office. The president's team has been busy shifting blame for inflation from the COVID-19 pandemic to the Russian war in Ukraine.

But Americans are not convinced.

In a survey published this week, a majority of general election voters (59.9%) claimed that "President Biden's policies and spending" are the top factors causing increasing inflation in the country. Just 31.6% agreed that the war between Russia and Ukraine is the top reason.

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