by Mitch Kokai
Senior Political Analyst, John Locke Foundation
Excessive taxes, spending, and government regulation have once again gripped America thanks to the policies of Biden, Harris, and the progressives. The predictable result is higher prices for everything and a repeat of the Carter Misery Index from which President Reagan rescued us beginning in 1981.
According to the Bureau of Labor Statistics, and as confirmed by Americans for Tax Reform, since January 2021:
- Gasoline prices have increased by 45% and other energy prices by 24.5%
- The price of bacon has increased by 8.4% and seafood prices by more than 6%
- The price of fresh milk has increased by 7.5% and fresh fruits by 8.4%
- Prices for major appliances are up 14% and furniture and bedding have increased 8.5%
- Airfares have increased by nearly 25%
The root of inflation is too much money chasing too few goods, as our economist friend Milton Friedman frequently observed. The New York Times warns that inflation also results in long-lasting damage if wages don’t keep up.
Driving this inflation is the largest federal budget since World War 2. President Biden proposes not only new infrastructure expenditures but rapidly expended direct payments to families in child tax credits and for elder care as well as other “cradle to grave” welfare support.
Biden claims all this new spending will ease inflation. We’re wondering what economics principle he is citing to make this outrageous conclusion. If simply spending more money cures these recent price hikes, why not spend more? Why not another $60 trillion instead of only $6? Preposterous. We’re currently suffering these record-setting price jumps precisely due to the $6 trillion we have already juiced into the economy. The last thing the economy needs is more liquidity.
The president is also proposing large tax increases, including increases in the corporate tax rate from 21% to 28%, returning the U.S. to the competitive disadvantage of the Obama/Biden years. And that’s just a peek at the “soak the rich” tax mantra Biden is proposing.