Powell Admits Fed Is Flying Blind Amid Government Shutdown

Federal Reserve Chair Jerome Powell just confirmed what most Americans already suspected: our economy is running blind under the Biden administration. During a Wednesday press conference following the Federal Open Market Committee (FOMC) meeting, Powell painted a grim picture of the Federal Reserve's current challenges, likening their situation to "driving in the fog." That “fog” is a direct result of the Biden administration’s inability to keep the government functioning.

For the fifth straight week, the federal government remains partially shut down crippling access to critical economic data the Fed relies on to make sound monetary policy decisions. Powell admitted that without this data, the Fed is forced to make decisions with severely limited visibility, saying, “We’re going to have to do our jobs one way or the other.”

In other words, the most powerful central bank in the world is now making high-stakes financial decisions based on guesswork.

Key takeaways from Powell’s statements:

• The shutdown is obstructing key economic indicators, which are necessary for determining interest rate policy and market guidance. The Fed’s next major policy meeting is set for December 9–10, but officials still don’t know whether they’ll have the data needed to make an informed decision.

• Despite poor visibility, the Fed cut interest rates for the second time this year, aiming to support the labor market, which Powell claims still shows signs of stability based on what limited information they’ve scraped together.

• Powell downplayed the long-term significance of the shutdown, calling it a “temporary state of affairs.” But temporary or not, this shutdown exposes the fragility and incompetence of the current administration’s economic stewardship.

The root of this dysfunction is political and it starts with the Biden White House and its failure to lead. When the government can’t even stay open, the American people should be asking: how can we trust it to manage inflation, foreign conflicts, or the national debt?

Let’s not forget that inflation remains above the Fed’s target and real wages have remained stagnant for months. Meanwhile, the White House seems more concerned with pushing radical spending packages and divisive policies than providing the Fed with the resources and stability it needs.

And here’s the bigger problem: the longer the shutdown drags on, the more damage it does to long-term market confidence. According to a recent Fitch report, extended government shutdowns can shave off 0.2%–0.3% of GDP per week yet the Biden administration seems utterly indifferent.

Add to that the fact that consumer confidence dipped again this month, and it’s no wonder Powell’s Fed is nervous. You can’t steer the ship when the compass is broken and Biden’s team is the one who smashed it.

This isn’t just about interest rates or temporary political bickering. It’s about leadership. And right now, the American economy is being run on empty by a president who seems more concerned with photo-ops and party politics than actual governance.

If the Biden administration can’t even manage to keep the lights on in Washington, how can we trust them with anything else?

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