Legendary singer-songwriter James Taylor, his wife Kim Taylor, and cellist Owen Young perform a musical tribute to U.S. Supreme Court Justice Ruth Bader Ginsburg during a ceremony at the Library of Congress in Washington, D.C. on Jan. 30, 2020. (LBJ Foundation Photo/Jay Godwin)
With friends like these, as the saying goes, who needs enemies? Certainly not U.S. consumers, who are facing about all the inflation reduction they can take as food prices continue to soar, notes the WSJ’s James Freeman.
A Win for the Middle Class?
The Biden White House yesterday celebrated the Inflation Reduction Act with a concert featuring James Taylor. Biden, according to Politico, patted himself on the back with the Act being “a win for the middle class.”
Worst Stock Market Day since June 2020
Outside of the White House, in the real world, there were no rose-tinted glasses: the stock market had its worst day since June 2020. The Dow Jones Industrial Average lost nearly 4%, S&P 500 lost over 4%, and the Nasdaq dropped 5%.
According to CNBC:
- “Inflation rose more than expected in August as rising shelter and food costs offset a drop in gas prices.
- The consumer price index, which tracks a broad swath of goods and services, increased 0.1% for the month and 8.3% over the past year. Excluding volatile food and energy costs, CPI rose 0.6% from July and 6.3% from the same month in 2021.
- Energy prices fell 5% for the month, led by a 10.6% slide in the gasoline index. However, those declines were offset by increases elsewhere. The food index increased 0.8% in August and shelter costs, which make up about one-third of the weighting in the CPI, jumped 0.7% and are up 6.2% from a year ago.”
Groceries Outpacing Overall Inflation
As James Freeman explains, the Biden White House is making Americans poorer.
From the WSJ’s Gabriel Rubin:
Food prices continued their relentless climb in August, according to the Labor Department, with groceries up 0.7% over the prior month and food at dining establishments up 0.9%.
Over the past year, groceries are outpacing overall inflation, rising 13.5%– the fastest pace since March 1979.
Economists are uncertain that the [Inflation Reduction Act] or any of the other provisions will have an effect on rising food costs.
Too Much Money Chasing Not Enough Work
Inflation is the dominant concern right now among voters. It’s likely to remain so through November’s congressional elections, Mr. Freeman reminds readers.
This means that if Democrats want to try to avoid the loss of their majorities they must act quickly to encourage the supply side of the economy, and also need the Federal Reserve to reduce the widespread pain afflicting consumers, savers and businesses.
There’s very little time before the political reckoning becomes inevitable.
The president has stubbornly refused to help, accelerating implementation of his poisonous policy mix of federal spending to fuel demand plus heightened tax and regulatory burdens to discourage supply. Too many dollars, not enough productive work.
Inflation is as dark as it has been in four decades, all of it happening on Joe Biden’s watch, “largely due to his own making.” Biden seems incapable or unwilling of changing course. America’s best hope is that voters will elect a “Congress willing to constrain him.”
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