The Biden administration refuses to take responsibility for inflation.
Biden blames everyone but himself. He blames railroads, energy companies, shipping companies, meat producers, business owners and Vladimir Putin. He denies the central role Democrats had in creating this problem: out-of-control wasteful spending, paying people not to work, ending American energy independence, and proposing trillions in new tax increases.
The Left is now saying that tax increases are needed to help solve inflation. But Jimmy Carter and Richard Nixon taught us that tax hikes make the problem worse.
Inflation is running rampant. The consumer price index increased by 8.3 percent in April. Inflation has increased six-fold since President Biden took office in January of 2021, when CPI was just 1.4 percent.
Biden not only claims this is everyone else’s fault, he still thinks it is about to go away. As inflation increased in the summer of 2021, Biden officials such as Treasury Secretary Janet Yellen first dismissed rising prices as “transitory.”
Then when inflation continued to increase, the administration blamed the pandemic and greedy corporations. President Biden even alleged that corporations were using “their power to squeeze out smaller competitors, stifle new entrepreneurs, and raise the prices.”
Since then, the administration has accused shipping conglomerates of overcharging Americans, claimed that meat processors are raising prices for families, and blamed Vladimir Putin and greedy oil and gas companies for rising energy prices.
This most recent assertion is especially egregious, as gas prices had already increased by 40 percent before Putin invaded Ukraine.
One big culprit for inflation is the policies being enacted and proposed by the Biden administration.
Since the beginning of COVID, Congress has spent almost $6 trillion in new funding. According to the federal government, $900 billion in federal spending has still not been spent by agencies.
Democrats have pushed policies that pay people not to work through an additional unemployment supplement. The most recent policy providing $300 a week to unemployed workers in addition to state unemployment benefits. Under this supplement level, over one-third of the workforce, or 37 percent of workers made more on unemployment than at work. This UI benefit had a notable depressive effect on employment.
Democrats transformed the child tax credit into a monthly $300 payment that was paid regardless of whether an individual worked.
The Biden administration has also repeatedly extended the moratorium on federal student loan repayments, costing $100 billion as of January 2021, and $4 to $5 billion each month since.
The myriad of welfare programs enacted in this time saw a family of four with two unemployed persons receive $109,048 from the federal government between April 2020 and September 2021, according to a report by House Ways and Means Republicans.
Biden has crippled American energy, contributing to rising energy costs. On his first day in office, he issued an Executive Order revoking the March 2019 permit for the Keystone XL Pipeline. The pipeline was projected to transport nearly 900,000 barrels per day of Canadian crude to refineries in the U.S.
Biden issued an Executive Order banning new oil and gas development on federally owned territory. Thankfully, a federal judge reversed this order. But that hasn’t stopped Biden from delaying decisions on new oil and gas leases and permits.
While the Biden administration’s existing policies have made inflation worse, their proposed tax increases would only double down on this problem.
President Biden’s most recent budget proposal is packed with trillions in new spending and tax hikes on the American people. His budget includes 36 tax increases on American individuals and businesses totaling $2.5 trillion over the next decade, including 11 tax increases on the oil and gas industry at a time when the price of gasoline is at record highs.
Biden’s budget includes massive tax hikes on businesses, like hiking the corporate income tax rate to 28 percent, imposing a 15 percent global minimum tax, and increasing the top individual income tax rate which will hit millions of businesses organized as pass-through entities.
These tax hikes will not be borne by businesses but are passed along to consumers through higher prices. According to a 2020 National Bureau of Economic Research paper, 31 percent of the corporate tax rate is borne by consumers through higher prices of goods and services.
While President Biden and Democrats have repeatedly claimed others are responsible for the inflation problem, it is clear that the administration’s policies have raised prices for American families and businesses. Worse still, their threatened “solutions” would make things worse.