COVID ‘bailout’ aid is the main cause of hyperinflation
If last week’s guest editorial is any indication, this newspaper endorses the Democrats’ deception that the Russian-Ukrainian war — not their misguided policies — is the reason for our skyrocketing inflation.
Excerpt: “We can also show our support by accepting the fact that our gas prices will go up, as will the cost of our food and other supplies. Before we complain… let’s think about the horror Ukrainians are facing following the Russian aggression.
Will he go up? Gasoline prices were up 40% year over year on the day the editorial was published. Gaslighting the American people by blaming the Kremlin is laughable.
Here is a small sample of the economic climate last January, a year after President Biden took office and several weeks before the Russian invasion of Ukraine:
US Bureau of Labor Statistics: “The all-items index rose 7.0% for the 12 months ending December, the largest 12-month increase since the period ending June 1982. together minus food and energy rose 5.5%, the largest 12-month change since the period ending February 1991. The energy index rose 29.3% over the past year and the food index increased by 6.3%.
The Wall Street Journal: “2021 should rank as the biggest year of inflation in four decades”
Jason Furman, former chairman of the Obama administration’s Council of Economic Advisers: “I expect inflation to remain very high in 2022.”
President Biden, speaking to reporters last July, was asked if he was concerned about rising inflation: “No one is suggesting that there is runaway inflation on the way – no serious economist .”
Biden’s mantra that inflation is “transient” can be infuriating at times. Imagine Samuel L. Jackson in this group of reporters demanding, “ENGLISH, motherfucker – do you get it?”
We all know how the game is played. In times of economic prosperity, the president receives too much credit and in times of crisis, too much blame. That said, the economic policies put forward by a president can help or hinder the economy. Just days after taking office, President Biden cut domestic oil production by placing a moratorium on new oil and gas drilling leases and shutting down the Keystone pipeline (as a concession to environmental extremists). This policy reduced American control over oil supply and prices.
By August 2021, Biden’s onerous policies had cut U.S. oil production to 11.2 million barrels per day, down from 13 million barrels under the Trump administration. That same month, Biden began asking OPEC to increase production. Brilliant. Buy more oil from bad actors who don’t like us very much, instead of encouraging domestic drillers to meet our needs.
By illusion, Europe has allowed itself to become dependent on Mr. Putin for its energy needs. How it works ? If Biden reversed his idiotic policy, North Dakota could deliver an additional 500,000 barrels a day. Same for Texas and Pennsylvania.
I am not concerned with whataboutism. Donald Trump spent like a drunken sailor and adopted trade policies that were destructive to our economy, both of which contributed to inflation. But Trump is history. Americans are (currently) suffering from runaway inflation and Biden’s policies are partly responsible for this painful reality.
Inflation is at its highest for 40 years. Americans see painful price hikes in used cars 40.5% y/y Gasoline 40% Rental cars 29% Hotels 21% Furniture 20% Bacon 18% Steak 17% Peanut butter 15.5% Pork 14 .5% Fish 13% Eggs 13% New cars 12% Electric 11% Chicken 10% Oranges 10%.
Those numbers spell doom for Democrats in November.
Of course, Democrats will insist that it was not their policies that contributed to inflation. Instead, they blame their favorite bogey: “greed.”
Social justice snowflakes like Elizabeth Warren and Pramila Jayapal would have you believe that the aforementioned industries conspired to raise prices around the same time out of sheer greed.
Both of these reprimands exposed Big Oil. Big beef. Great Grocery. And now, the mother of all infamous business “scams”: Big Coffee! Yeah. Jayapal accused Starbucks of “corporate greed”. It’s amusing to see progressive elites ranting about the scourge of the expensive cappuccino.
Elizabeth Warren, who was paid $400,000 a year to teach a course at Harvard, made a career out of opposing “price gouging.”
As Milton Friedman once joked, blaming inflation for price hikes is like blaming rain on wet streets.
Why is everything so expensive, Lizzy? Could it have something to do with a record increase in the money supply, an increase in government courtesy checks on personal income, and disincentives to work?
Sure, supply chain bottlenecks, the needless shutdown of entire economies during the pandemic, and labor shortages haven’t helped, but to paraphrase James Carville: it’s the spending , stupid.
The most important factor in our hyperinflation has been trillions of dollars in “bailout” government aid – far more aid than the European Union, Canada or the United Kingdom have given their citizens – and it is therefore not surprising that we currently suffer from worse inflation rates than these countries.
— Reggie McConnell, Terre Haute
Indiana’s policies put the state on a difficult economic path
The Hoosier State has embarked on a long-term economic journey comparable to that of the Titanic.
According to an article by Michael J Hicks in the Ball State Center for Business and Economic Research’s Weekly Commentary – titled “Indiana’s Long Term Economic Prospects Are Poor,” our state currently has record industrial production, with just 11,500 fewer jobs than before the Covid-induced recession. Indiana fell from 24th in average wages to 35th compared to other states, between 2000 and 2019. The average earnings of its workers fell from nearly 88% of the national average to 85% during the same period . This decline is likely the result of low wages, low education, low tax rates and poor services – the “Mississippi model”, which our recent legislative majorities have attempted to replicate in our state over the last two decades.
Indiana’s low housing costs, a major reason for the state’s lower cost of living, are the result of reduced housing demand across much of the state, which in turn is due to a lack of well-paying jobs. People trained in our state university system don’t stay because the jobs they were trained for just aren’t there. Policymakers should be extremely concerned because between 2000 and 2019, the only net increase in jobs in the state occurred in the Indianapolis area, with the rest of the state losing jobs.
Instead of taxing enough to fix and improve our infrastructure and education systems, the legislature chose to cut taxes on manufacturing and cut environmental protections to attract low-wage and dirty manufacturing to the state. They have succeeded in attracting polluters without the corresponding increase in jobs. According to Hicks, our taxes on manufacturing businesses have fallen from 25th to 4th lowest in the nation over the past 20 years, while we have lost 120,000 manufacturing jobs.
This drop in tax revenue has led to a drop in our schools, teacher pay, and infrastructure, as well as an increase in state poverty, drugs, and health problems. Social ills have fueled drug-related crime which, in turn, seems to have created the need to expand our prisons and correctional facilities. It looks like these will be our growth industries of the future. We have locked in a state government that rules on the basis of ideology, lobbyist demands, and corrosive policies recommended by ALEC, a right-wing think tank funded by Charles Koch.
Examine some of the bills the Indiana General Assembly produced in the last session to further degrade our school systems, our environment, and our economic prospects. HB 1134 would have weakened our educational system by preventing the teaching of a subject that could make students uncomfortable. This would have prevented social studies classes from examining moral or historical controversies. HB 1220 was an attempt to make it more difficult to obtain an absentee ballot and would have prevented third parties from assisting in this effort. HB 1240 was designed to create division in our public schools by turning school board elections into partisan elections. A last-minute bill passed repeals the licensing process required to carry a handgun.
All consumer-friendly pro-solar laws were killed in committee by our legislature, while laws requiring consumers to subsidize experimental modular nuclear reactors remained active. SB 265 and HB 1249 in combination would have forced Hoosier landowners to allow the storage of high pressure CO2 waste under their properties without their consent, grant eminent domain to these companies allowing them to condemn properties without compensating the owners and force Indiana taxpayers to take responsibility for problems arising from carbon sequestration. We have the best government money can buy, to hell with the common good.
This neglect of the common good is reflected in the fact that higher education and K-12 have experienced significant budget cuts.
According to Hicks, we are spending a smaller share of our state’s GDP on education than at any time in decades. Inflation-adjusted spending per student for college and K-12 students is lower than at any time for which comparable data is available. The share of Hoosier high school graduates heading to college has been declining for five years, and the percentage of adults with college degrees began to decline in 2019.
The consequence of these collective policies should be obvious. Citizens of the Hoosier State should think deeply about the consequences of the policy as usual; It’s time for a change.
—Robert Dodson, focal point
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