President Biden and House Speaker Nancy Pelosi both pushed back this week on assessments that spending by Democrats was causing the country’s skyrocketing inflation.
“I’m sick of this stuff,” Biden said at a Democratic retreat in Philadelphia, gesturing with his hands to suggest he’d had it up to his neck. “The American people think the reason for inflation is the government spending more money. Simply not true.”
Pelosi in a separate news conference said, “When we’re having this discussion, it’s important to dispel some of those who say, well it’s the government spending. No, it isn’t. The government spending is doing the exact reverse, reducing the national debt. It is not inflationary.”
Experts say Biden’s $1.9 trillion American Rescue Plan along with problems caused by the coronavirus pandemic, including supply chain issues, rising demand and a smaller number of employees having returned to work asking for better pay, and low interest rates is helping hike prices, according to The Wall Street Journal.
Blaming Putin
Biden’s decision to ban oil, natural gas and coal from Russia over President Vladimir Putin’s invasion of Ukraine will also push gas prices higher, which Biden has started calling “Putin’s price hike,” although inflation started many months before the war.
“Make no mistake, inflation is largely the fault of Putin,” Biden said Friday.
Pelosi echoed the claim: “Putin’s gas hike. That’s his gas hike,” she told reporters.
Brian Riedl of the Manhattan Institute – who was a chief economist for Sen. Rob Portman, R-Ohio — said, “Fiscal policy has been extraordinarily aggressive, and the main example was the American Rescue Plan that was enacted last March, which shot a $1.9 trillion bazooka into a $420 billion output gap,” according to NBC News.
Steven Rattner, a former Treasury Department official under the Obama administration, has called the spending in American Rescue Plan the “original sin” that caused inflation.
*story by Fox Business
