Bidenflation is Making Us Poorer
It’s amazing how often President Trump was pilloried by the leftist media for comments that later turned out to be 100% correct. For example, January 2017, Trump said that his campaign was spied on. Democrats and their media had a meltdown. Last month, the Durham investigation and the Wall Street Journal proved that candidate Trump, president-elect Trump, and President Trump was, in fact, spied on by the FBI (probably the NSA as well). Then, October 2020, Trump said, “The policies of the Left would unleash an economic disaster of epic proportions.” Again, the Dems and their media (CNN, NY Times, ABC, etc.) had a meltdown. Sadly, we are experiencing Trump’s predicted economic disaster -- historic inflation and record gas prices.
Regarding inflation, when Trump left office, inflation was an annual rate of 1.2%. In the past six months, inflation is out of control. According to the Bureau of Labor Statistics, year-over-year inflation was 6.2% (October), followed by 6.8%, 7.0%, 7.5%, and 7.9% (in February). If they used the old method (pre-1980) of determining inflation, it would be over 14.5%. Thank you, Joe, for your Bidenflation.
Throughout history, perhaps nothing has destroyed more governments than food shortages and economic collapse. Except for war, it’s hard to think of anything that creates more panic than not being able to afford basic necessities like food or fuel. Right now, the United States is in danger of falling into those conditions, yet Biden seems to be unconcerned. Worse, he doesn’t even notice it’s happening. The Dems think that record inflation, spiking gas prices, and supply issues will go away if they simply ignore what’s happening. And why won’t they? If a boy can become a girl by mere fantasy, then inflation and economic disaster can certainly be averted by wishful thinking.
Biden’s inflation is the result of his horrendous economic policies and a war on petroleum. President Trump accurately predicted that Bidenflation would lead to $7.00 gas prices. Unfortunately, most Bidenflation is on necessities -- energy and food. Again, according to the Bureau of Labor Statistics, since Biden took office, energy is up 26%, gas (here in central GA) is up over 100%. Meat and poultry are up 13%, and used vehicles are up 41%. Consider inflation’s cost to businesses -- labor costs have increased dramatically, if you can even find people willing to work. Even high earners are worried about rising prices. Those making $40K or $50K, the income of many in rural Georgia, are terrified at their shrinking paychecks. Prices are rising far faster than wages.
Through the lens of Econ 101, look at two recent examples of supply and demand: April 2020 we were all “locked down,” not going to school, church, work, etc. -- we were driving less. Demand for gas decreased but supply stayed the same. What happened to gas? Prices dropped to $1.67/gallon (Georgia’s average), 35 cents lower than one month prior. Next, with all those people at home, not at the factory producing goods, supplies dropped. And with tens of millions of people sitting at home, they began home improvement projects -- i.e. buying items such as lumber, flooring, etc. Demand for home improvement items rose while supplies shrank because nobody was producing. What happened to prices at Home Depot, Lowe’s, etc.? They skyrocketed; 2 x 4s tripled in price -- demand rose, supplies shrank.
Regarding current inflation, Biden and his media insist “It’s not me, it’s Putin, it’s COVID” that’s responsible. Know this, whatever they (Biden and Democrats) say isn’t the cause, most certainly is the cause. So, what’s the root cause of Bidenflation?
Last week, Biden told us government spending simply isn’t the cause of inflation. Biden actually said that his historic spending will reduce the deficit and inflation. (Try telling your spouse that your $20,000 credit card charge actually reduced your deficits.) Even though Joe has never been mistaken for a genius, he knows perfectly well that government spending is the cause of inflation. Inflation is a function of the money supply. It’s nothing more than the number of dollars in circulation chasing goods available to purchase. The more money in circulation, the less each single dollar is worth, and prices rise.
Right now, through government regulatory action, Biden has reduced the supply of gas while demand has increased (people are driving more because lockdowns have finally ended). More importantly to our inflation discussion -- in the last year, the U.S. government, with Biden’s insistence, has printed more money than any government in world history. So, Biden greatly expanded the money supply; he reduced the supply of gas while demand for gas increased. Therefore, gas prices will rise, as we’ve seen. Our supply and demand and money supply scenario can be applied to every item in the economy. Prices have risen because the Federal Reserve has greatly expanded the money supply. More dollars in circulation means every dollar buys less than before. The result is higher prices or Bidenflation. It’s not complicated.
To be fair, the huge expansion of the money supply didn’t begin with Biden. It began back in 2008 when the Federal Reserve gave themselves emergency power to print endless amounts of money under the policy of “quantitative easing (QE).” What is QE? Nobody really understands. It’s bureaucrat doublespeak. QE has been ongoing since 2008, but on steroids with Joe.
In the last year, Democrats and Biden have passed two of the largest spending bills in history, a $1.9 trillion package last March and another $1.5 trillion last week. (Recall last year everyone received $1,400 of “free money.”) Those huge spending bills are on top of Biden’s $6 trillion 2022 budget -- spending levels no government in human history has ever attempted, largely because most governments realize such spending will destroy the economy. Not Congress -- they have run up deficits that can never be repaid, unless every dollar is made less valuable; which they’re doing splendidly.
In real numbers, inflation will cost the average household $296 more each month or over $3,500 in 2022 alone. If you’re a big democrat like Obama, Hillary, or Stacey Abrams, that $3,500 means nothing. However, if you make $40,000, that $3,500 in additional costs is a disaster. That level of inflation will dramatically change your lifestyle. Bidenflation is making us poorer.