Politics

Damaging Democrat Inflation

Biden

As we get drawn into a Biden-Harris inflation vortex, a time of economic unpredictability, swiftly changing the value of our money, a few things are predictable. Inflation – what it is, where it comes from, how it affects life, how long it lasts, and what scars it leaves – are worth knowing.

First, inflation is not the end of the world but can markedly affect life. It does not appear from nowhere. Despite best efforts of economists to manipulate statistics, it does not follow a set schedule, like phases of the moon.

Inflation is a measurable increase in prices, sometimes suddenly, which promptly cuts purchasing power for dollars you earn, save, and spend.

Economists – who like to apply quantitative analysis, fancy models, and big words to simple phenomena – say inflation follows “business cycles.” That is not entirely true – because even “business cycles” are “much of a muchness,” to borrow from Shakespeare’s chuckling cynicism. 

Nothing wildly scientific is needed to understand core inflation or business cycles. Consumers want things; businesses make them, prices reflect how much and how many and how fast people want those things, whether there is competition, what the inputs (labor and capital) cost, delivery to market.

Yes, human behavior can be painfully complicated or quite simple. Growth occurs in an economy when people want things, businesses make them, and people gain from employment, earnings, more purchases, a better quality of life. That is capitalism at work; the less government, the better it works.

Yes, economies tend to follow basic patterns. People have dreams and wants; prices start low, the cost of borrowing to meet dreams and wants is low, then things heat up, inputs get scarce, prices rise. This dissuades people from buying, so an economy slows, maybe recession, prices fall, we begin again. Economists use jargon, quantify human behavior, infer cycles, but you get it. See, e.g., Business cycle.

All this is normal, just waves on the beach, coming and going. And built into those recurring waves of consumer and business activity are changes in price.

Generally, with more activity, more inflation happens – prices tend to rise if more people want a thing of limited quantity (“demand-pull”), or prices rise with input costs (labor and raw materials), but this is not the story’s end.

Core inflation – call this good inflation – reflects a surging market, rapid expansion, growth in output, tight labor market despite high participation.

But there is also another kind of inflation, bad inflation – a sudden rise in prices, cheapening of currency, plummeting of the dollar, breathtaking loss of purchasing power, driven by irresponsible fiscal policies, massive debt, overspending by the federal government, and no sense of matching production to spending. See, e.g., Rand Paul releases report on rising inflation: ‘It’s only going to get worse.’

That is what we are facing right now. The scary part is that total power in Democrats’ hands – White House, Senate, and House – has allowed a radical shift toward irresponsible fiscal policy, debt, and overspending.

To be clear, no level of increased taxes (which slows an economy, producing unemployment, lower revenues, more bankruptcies), or increased interest rates (often intended to slow good inflation), or any other instant tool can fix bad inflation overnight.

Once Democrats pushed this snowball over the top, and it began rolling, the consumer – especially those with limited resources – was in trouble. And that is where we are right now.

Today, we are seeing the biggest “bad inflation” surge in 40 years, a whopping seven percent in December, headed only higher.

This is a direct result of feckless, uninformed, “don’t give a care” federal spending – Democrats thinking they can buy votes with giveaways, COVID money, topping up unemployment benefits, mass socialist spending.

What is the real result? Your dollars – the ones you work hard for – are going to be worthless and less until fiscally responsible leaders are elected and take over the economy, those who believe in limited government, not more.

The coming tsunami of inflation will only taper when people are given freedom again – when those sitting on the sidelines are incentivized to rejoin the labor market, when COVID mandates vanish when the energy sector is restored, when public safety returns, when the federal debt is taken seriously when massive, crazy federal spending and concentration of power ends.

Only then will conditions return that allow consumers and producers, with a degree of flexibility, predictability, and less fear of government, to do what they do so well – grow, prosper, fulfill the “pursuit of happiness.”

In the end, this Democrat-driven inflation is a bad penny, sure to trigger loss of not only purchasing power but personal contentment, job, and income security, value in savings, and trust in the future. 

So, what is the answer? To get the inflation monster back in its cage, we need to demand fiscal responsibility elect those who believe in limited government, not run-a-muck spending. Federal debt needs to come down, socialist, discretionary, and unaffordable entitlement programs need to be reined in.

In short, the American people need to understand Democrat-driven inflation is counterproductive, amounts to a massive tax on the Middle Class, puts brakes on the private economy, and is not sustainable. The sooner we realize this, understanding the damage inflation does, the faster we can turn this around. 


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Mario Capparuccini
3 months ago

I thought Biden promised to not increase our taxes. Yet, his stupid policies have done just that, hurting those who can least afford the price increases. Why 40% of the polled population still thinks he is doing a good job is beyond me, unless the polls are as crooked as the election.

Jake the snake
4 months ago

The current inflation was 100% cuased by bidens EO’s in January 2021.

He cut off our domestic energy supply which turned on the inflation machine.

Want low inflation and high employment? Never vote democrat again

Karen
4 months ago

All I can say at this point is, b4 that commie Biden got into the WH, I was spending around 50 to 65 bucks a week for food and other needs. Yesterday, I spent $96.00 for needs with no extra goodies. That sonofabitch has to go NOW!

BlessdAmerican
4 months ago

Inflation is almost entirely a result of government spending. Overspending to be exact. The natural business cycles never devalue our dollar like government overspending does. Inflation doesn’t even have to happen, it isn’t “inevitable” except for govt. spending.

Rik
4 months ago

What Communist Democrats hear is what Communist Democrats do! . . . No surprises here!

Dan
4 months ago

The right word is “run-amok” — not “run-a-muck.” Otherwise your articles are usually great.

Phillip Ridenour
4 months ago

Inflation is not the end of the world. Tell that to the people of the Weimar Republic who carted wheelbarrows of cash to the grocery store. Better yet, tell that to the people of Venezuela.

Jake the snake
4 months ago

Or Argentina ot Togo or tonga. Wild inflation destroys countries.

Oh but that is what the democrats want

BlessdAmerican
3 months ago

And their inflation was due to corrupt governments. Inflation is at 90% a result of government overspending. It is not “inevitable.” Normal business cycles, which are generally mild, NEVER devalue the dollar like government overspending and the out of control PRINTING of money.

China is laughing all the way to the bank, while pulling the strings of Bejing Biden.

Carol
4 months ago

There are so many people on the Government dole today that to cut back on spending, too many would scream and holler about losing their handouts! How many Americans will STOP talking government handouts to help REAL spending cuts take place? Not sure America has the courage to take this on until the country collapses. I pray I’m wrong!

Max
4 months ago
Reply to  Carol

Your comment is correct. America needs to wake up now because if collapse happens, IT IS TOO LATE !!!

BlessdAmerican
3 months ago
Reply to  Max

If the government collapses, the “dole” is gone. The government is actually paying people not to work. Bejing Biden is a Commie China puppet.

Broccoli Free Zone
4 months ago

The national debt increased $2 trillion in 2021. THAT is the cause of the inflation monster busting down the door.
VAX mandates for truck drivers is another factor. Many thousands of drivers have stopped because of mandates AND the price of motor fuel. That partially explains the empty shelves and decomposing produce available at the stores. Let us go, Brandon.

BlessdAmerican
3 months ago

EXACTLY. Normal business cycles NEVER cause this type of inflation. Government spending does. And of course the out of control printing of money has further devalued our dollar. If it weren’t for government over spending, there would be no inflation.

PaulE
4 months ago

“So, what is the answer? To get the inflation monster back in its cage, we need to demand fiscal responsibility elect those who believe in limited government, not run-a-muck spending. Federal debt needs to come down, socialist, discretionary, and unaffordable entitlement programs need to be reined in.”

We have two sources that have flooded the economy with excess dollars and thus stoked inflation:

One is the Congress that doesn’t understand the concept of actual SPENDING CUTS. I mean actually reducing or eliminating spending on the third of the annual federal budget that serves no purpose other than maintaining the political pork system in this country. The majority of neither political party is serious about actually doing real cuts (only a handful of current members of Congress actually are) or they would adopt a zero-based budgeting model for the entire federal budget. We’ve gone from spending bills being the billions to spending bills being in the trillions, like there is no downside risk associated with this level of accelerated wasteful spending. Well inflation is one of those risks and it is going to be very hard and painful to wring it out of our economy.

Number two is the Federal Reserve System that has been operating in emergency mode since 2008, when they had to bail-out the economy from train wreck caused by the Democrat’s misuse of the CRA (Community Reinvestment Act) to force banks to make mortage loans to people with sub-standard credit and then all that debt to be monetized via the bond market. The Fed has since become the lender of last resort for virtually every single financial instrument except individual stocks and has given a green light to runaway spending by Congress by keeping long-term rates artificially low. The Treasury is literally printing money out of thin air when the normal Treasury auctions don’t provide sufficient revenue to keep the party going.

So higher rates of inflation are a natural by-product of these two sources. The fixes are straight-forward, but I doubt there is any real commitment currently in Washington to properly address the issue. I also kind of doubt a majority of the public would be up to the task of backing this effort long-term, as most of the public seems to desire quick and painless solutions that in this case don’t exist.

Bill T
4 months ago
Reply to  PaulE

It’s a miracle that Manchin a moderate went against the socialist agenda and stopped the build back better communist strategy of the disastrous administration. Or another 3-5 trillion dollars would be dumped on top of this out of control inflation mess.

PaulE
4 months ago
Reply to  Bill T

The true cost of the BBB bill is $5.5 trillion as estimated by the CBO. Forget all the other numbers quoted by the Dems and the MSM. That is just pure spin to try and fool an uninformed public. As to the fate of that bill, the Dems now plan to break it up in several parts in the hope they can sneak most of the massive social engineering spending through without any major public uproar or notice. So the bill isn’t dead by any means and how much resistance Manchin would have to it after the midterms is highly questionable. He knows he can’t vote for the bill before the elections, because he would be gone. So my sense is that Manchin would be much more open to some sort of “compromise” after the midterms.

If that much spending gets added to an already over-heated monetary level, we could be looking at elevated rates of inflation for 5 to 10 years as the value of the dollar declines steeply. Even if the Federal Reserve intentionally causes an extended recession, with that much excess money in the system, it would take years to bring inflation back under control. Also keep in mind that the BBB bill isn’t the only spending bill the Democrats want to pass this year. The more money they dump into the economy, the more inflationary pressure they build up in the economy and the more they depress the value of the dollar.

To both Senators Manchin and Sinema, I see the far left socialists in the Democrat Party are actively trying to get the voters in their respective states to replace them with diehard Marxists who will tow the Democrat Party line. Seems most MSM networks are intentionally ignoring that story. So the Democrat Party is covering all the bases to try and eliminate the two hold-out Senators.

Max
4 months ago

RBC: TOUCHE !!!

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