As the economic outlook gets uglier, Biden blames everyone but himself
Earlier this week, the Biden administration was presented with some grim news. Inflation increased to a staggering 9.7% for the year ending January, much higher than forecasted. Consumer prices also increased by 7.5%, the highest annual rate in four decades. Despite promises by Biden to reduce inflation, it has continued to increase, putting more pressure on Americans to pay for everyday goods. In addition, Biden piled on more bad news for Americans, indicating that Russia's suspected invasion of Ukraine will further increase gas prices, which are already at an eight-year high.
Government numbers aside, real-world inflation is already in double-digits because the government under-reports little things, like gas and groceries, the very things we need and buy in real life. These cascading effects will substantially curtail home-buying for Americans. Instead of bringing the bacon home, literal bacon costs you an extra 18.6%. It will continue to add to the struggles of American families, who will find it more costly to put food on their tables. This is a road that can lead to hyperinflation.
Instead of offering a plan to combat these economic challenges, Biden has turned to blame anyone but himself for his policies. Inflation, Biden claims, is the Republicans' fault because they did not support his two-trillion-dollar Build Back Better spending bill. Democrats control the White House and both chambers of Congress. Shortly after, he blamed Russia and Putin's provocations with Ukraine for increased gas costs to American consumers. However, Biden canceled the Keystone pipeline in the U.S. and approved the NordStream 2 pipeline between Russia and Germany. Biden need only look in a mirror to discover the person to blame.
The financial impact of Biden's policies on Americans, left unchecked, will likely lead to a sea change in the midterm elections.
Four critical economic and political questions remain:
- What must happen before inflation starts to decrease? The Federal Reserve signaled it would raise interest rates multiple times in 2022. This might help reduce inflation but will have a devastating impact on Americans.
- What will happen if the Fed "succeeds" in lowering inflation? A decrease in inflation may reduce the prices of goods such as milk, gas, and bread. However, it also has a reciprocal impact on the buying power of Americans. When interest rates increase, it will make it harder to buy homes due to unaffordable mortgages. Businesses will see their costs increase, which will impact the American workforce.
- Why is Biden blaming everyone else for his failed economic policies? It is no secret that Biden's domestic agenda has utterly failed at every turn. With the 2022 midterm elections coming up, he has to find a villain to blame for the depleting economy. The Democrats are projected to sustain heavy losses in the House and Senate this year, and he has to stop the bleeding as quickly as possible.
- What could Biden do next to save the economy and help Democrats in the upcoming election? The economic distress in the U.S. will take months to fix. Biden is running out of time, and his influence in his party is meager. His poll numbers say it all. He is at the lowest approval rating of his presidency. He has to change course quickly and present an economic solution that the American people will believe. Up to now, Biden's shown that he has been incapable of overseeing a strong economy, and most Americans do not believe he has what it takes to produce a strong economy in the future.
Blake Harbin is the CEO of Houzzle Financial, a mortgage lending company in the Southeast. He has been a small business owner for more than two decades and is an expert in the real estate industry. Blake is running as a candidate for Georgia's 6th Congressional District in 2022.