As the nation inches closer to the 2022 midterm elections both parties are sharpening their messaging and honing in on what’s on the top of people’s minds. After a rough year of record-high 9.1% inflation this summer, record-high gas and food prices, skyrocketing rental/housing costs, and a national baby formula shortage, President Biden and Washington Democrats have shifted their messaging and are now trying to convince Americans that the economy is on the right track. That’s a remarkable thing to hear when 64% of voters think that America is on the wrong track, according to a Real Clear Politics (RCP) average of recent polls. That sentiment echoes what are reportedly the top issues on the minds of voters: inflation, high gas prices, and the economy generally. So why, despite being more vocal, is President Biden’s defense of the economy such a sham? Here’s why.
One of the Democrats’ main arguments early on in support of the Biden economic agenda, was that inflation wasn’t a big concern and was “transitory” in nature. Yet early this summer, Biden’s Treasury Secretary Janet Yellen admitted that her views were “wrong” and that she “did not fully understand” the effect that President Biden’s mega trillion dollar spending bills in Congress would have on a pandemic-struck American economy.
This summer, economic data of the U.S. Gross Domestic Product (GDP) showed that America’s economy shrank by 1.6% in the first quarter of 2022, followed by a .9% decline in the second quarter. Wall Street has historically defined a recession as two consecutive quarter declines in economic growth, which is usually measured by GDP. President Biden’s response? “It doesn’t sound like a recession to me,” he told reporters. “We are on the right path and we will come through this transition stronger and more secure,” Biden said, pointing to low unemployment and a large number of job openings. Not only is President Biden wrong in his assertion that we’re not in a recession, but his defense is a lie, because Biden’s Federal Reserve Chairman, Jerome Powell, is now saying openly that one of the intentions driving the Fed’s decision to continue to raise interest rates, now targeting a higher than expected 3-3.25%, is to increase the unemployment rate. You heard that correctly. The Fed is manipulating the economy in order to put 1 million or more Americans out of a job, on purpose, when inflation is still high and doesn’t show any sign of declining.
Declining inflation is another one of President Biden’s lies, as he continues to point to Fed and Congressional action, such as the recently passed climate, health, and tax bill known as the “Inflation Reduction Act.” What that bill really does is hire 87,000 new IRS agents, practically doubling what is already the #1 most staffed federal agency, to go after every day Americans and small businesses. It also increases taxes for middle and low-income families who can expect to pay approximately $2,400 more this year. What’s worse, it will likely increase inflation, the very thing it’s supposed to reduce, and it adds to the deficit.
Lastly, Fed Chairman Powell has signaled after last week’s interest rate increase that we should expect one, possibly two more hikes this year, until unemployment rises and the housing market has a “correction.” Stocks had been down in the days leading up to last week’s Fed meeting, however, with these latest remarks, the Dow Jones Industrial Average entered bear market territory shedding nearly another 500 points and closing below 30,000, a new low for 2022 and another sign that a high-inflation, low-growth economy, also known as a recession, is already here.
Instead of working to reduce inflation and put more people back to work, Democrats are getting in our way, passing more spending bills, inflating the size of government, harassing small businesses, and slowing the economy. Add to that a Biden Administration that inherited an energy independent, oil and gas exporting economy and turned us back into an energy dependent nation through excessive regulation and heavy handed mandates. Biden and his administration officials will continue to try to sell us their sham figures and rhetoric but American voters are surely feeling the pinch at the kitchen table and the pump — we’re just not buying the malarkey this time, Mr. President.
Bob Carlstrom is President of AMAC Action