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August 11, 2021

Washington Squeezes Middle America

Beltway policies are driving the household budget troubles millions of us face.

The great malaise of Joe “Carter” Biden continues.

  • Consumer prices rose 5.4% in July over the same month last year, continuing the inflationary trend of 2021.

  • A record 10.1 million job openings were posted in June, as employers continue to struggle to find workers. The unemployed are often paid more not to work. That drives up wages as businesses are forced to compete with the government for workers, and it also causes problems with the supply chain. Those issues in turn drive up prices of consumer goods and services. I.e., inflation.

  • Meanwhile, Congress continues to flood the economy with money through gargantuan “emergency” spending bills. Increased demand with suppressed supply yields inflation. “In fact,” reports The Daily Signal, “since the start of the pandemic, 54% of the new federal debt ($2.8 trillion) has come from newly printed cash flooded into the economy by the Fed.”

So when you sit down at the kitchen table to figure out how you’re going to make ends meet again this month, remember to thank our betters in Washington. Because government policy is driving this malaise.

Worse, Democrats are really just getting started. The Senate passed its $1.1 trillion “infrastructure” bill yesterday (which one estimate says won’t create any jobs), and this morning promptly began clearing the way for Bernie Sanders’s agenda to follow it. That would be the $3.5 trillion spending bonanza that increases or adds to the cradle-to-grave welfare state.

Just about the only thing not in the Democrats’ spending bill is raising the debt ceiling to allow the money to be spent. The Senate’s 50 Democrats don’t need Republican help to pass their reconciliation bill, but they want GOP help to hike the debt ceiling in a separate measure. That’s very thoughtful of Democrats, but — surprise — Republicans remain skeptical. Some 46 GOP senators have already pledged not to raise it.

Yet there were 19 Senate Republicans who joined every Democrat to pass the Infrastructure Investment and Jobs Act, including Minority Leader Mitch McConnell. There’s plenty of reason for conservatives to be frustrated with that, but McConnell is playing chess, not checkers.

How so? It’s not only Republicans feuding over the spending bills. At least two Democrat senators, Kyrsten Sinema and Joe Manchin, would only consider the Sanders bill if infrastructure passed. Yet, in the House, Speaker Nancy Pelosi and rabble-rousing Squad member Alexandria Ocasio-Cortez have joined forces to hold the infrastructure bill hostage to the bigger spending measure.

McConnell is forcing Democrats to air their disagreement, and then to own it when it comes to raising the debt ceiling. The process of drafting and passing the $3.5 trillion bill is likely to take several months, giving both parties plenty of time for politics.

Republicans might just have an edge. Pelosi has a slim 220-212 majority (with three vacancies), and 11 Democrats voted against hiking the debt ceiling in 2019. Will they vote for one now that it comes with spending $3.5 trillion and raising taxes by $2 trillion — just before what’s sure to be a tough election cycle?

Did we mention that the government’s massive deficit spending is driving the budget crunch for American families?

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