The consumer price index increased by 9.1 percent on an annualized basis in June, according to the Bureau of Labor Statistics (BLS), setting yet another 40-year high for the seventh time under President Biden. In June alone, inflation increased by 1.3 percent.
In January 2021, before Joe Biden took over the presidency, annual inflation was at a stable 1.4 percent. Just one year into Biden’s presidency, inflation has increased by 6.5 times. While inflation has already hit American families hard, Democrats are pushing policies which would make this problem even worse, like trillions in tax increases and wasteful spending.
Since July of 2021, the Biden administration has been insisting this problem would go away. Federal Reserve Chairman Jerome Powell and Treasury Secretary Janet Yellen described this inflation as “transitory.” Evidently, those claims have not held up. Now, the Biden administration is trying to blame inflation on the Russia-Ukraine war, despite surging inflation pre-existing the conflict by nearly a year.
Even today, the Biden Administration attempted to minimize the problem of inflation in a desperate, lengthy statement, arguing that the inflation data is “out-of-date” and blaming COVID-19, Russia, and oil and gas companies.
The erosion of purchasing power is especially concerning given that wages are decreasing. Real average hourly earnings have decreased by 3.6 percent over the past year.
According to BLS, the cost of many goods and services have increased significantly over the past year:
- Energy has increased by 41.6 percent in the past 12 months.
- Gasoline has increased by 59.9 percent in the past 12 months.
- Used cars and trucks have increased by 7.1 percent in the past 12 months.
- Bacon has increased 11.9 percent in the past 12 months.
- Chicken has increased 18.6 percent in the past 12 months.
- Eggs have increased 33.1 percent in the past 12 months.
- Furniture and bedding have increased 13.1 percent in the past 12 months.
- Men’s suits and sport coats have increased 24.9 percent in the past 12 months.
- Airfares have increased 34.1 percent in the past 12 months.
- Cereal has increased 15.1 percent in the past 12 months.
- Rice has increased 11.9 percent in the past 12 months.
- Milk has increased 16.4 percent in the past 12 months.
- Coffee has increased 15.8 percent in the past 12 months.
- Butter and margarine have increased 26.3 percent in the past 12 months.
- Public transportation has increased 23.7 percent in the past 12 months.
- Delivery services have increased 14.4 percent in the past 12 months.
The Biden Administration’s policies are largely to blame for inflation. President Biden has passed bills and executive orders that pay Americans not to work, expand tax credits, pause federal student loan repayments, canceled the Keystone Pipeline, and more.
It’s hard to believe that, during this time of economic turmoil and the threat of recession, Democrats have renewed negotiations for reconciliation plans. They hope to pass trillions in tax hikes and reckless spending, which would certainly make inflation worse.
Democrats’ proposal will likely include massive tax hikes on businesses, like a 15 percent global minimum tax, 15 percent domestic minimum tax, and a $252 billion 3.8 percent net investment income tax (NIIT) on small businesses.
These tax hikes will be passed on to consumers through higher prices, as if rampant inflation wasn’t painful enough. According to a 2020 National Bureau of Economic Research paper, 31 percent of the corporate tax rate is borne by consumers through higher prices of goods and services.
Further, reckless spending on climate initiatives, welfare programs, and supersizing the IRS – as Democrats will propose – will also exacerbate inflation.
The Biden Administration and congressional Democrats who have eagerly supported the President’s agenda, seem willing to sacrifice Americans’ financial security in order to pass their Leftist agenda before they lose control of the government.