Worried about inflation eating up your paycheck? Relax: Uncle Sam can keep sending you handouts to make up the difference.
That, at least, is the warped and dangerous logic behind President Joe Biden’s claim last week that if you “combine” average wage increases with “the direct relief my administration’s provided . . . disposable income has actually gone up 2 percent this year, even after accounting for higher prices.”
It’s hard to think of a faster route to national bankruptcy, yet that’s the direction Biden and fellow Democrats want to go in — starting with yet another round of handouts in their $2 trillion Build Back Better bill ($4 trillion if they’re honest).
Per the Bureau of Labor Statistics, October prices were up 6.2 percent over last year, the largest spurt in 31 years. That means real average hourly earnings (i.e., after adjusting for inflation) actually fell 1.2 percent year over year. The length of the average work week also fell, netting a total “1.6 percent decrease in real average weekly earnings.”
Biden claimed “disposable income” rose only because he counted the boost in the child tax credit, from $2,000 to $3,000 ($3,600 for kids up to 6), that came with the $1.9 trillion stimulus package Dems passed in March (with no money to pay for it). Yet sending folks free cash you don’t have does little to grow the supply of goods and services; it only heats up inflation, just as even liberal economists like former Treasury Secretary Larry Summers warned — quite correctly, it turned out — it would.
Now Biden & Co. want to pump another $2 trillion into the economy via Build Back Better. Some of it, about $160 billion, is similarly unfunded, the nonpartisan Congressional Budget Office reports; absent accounting gimmicks, trillions are.
If you think inflation’s bad now, just watch if this bill is passed. Heck, even Biden’s own Treasury secretary, Janet Yellen, admits inflation won’t cool before the end of next year.
Meanwhile, BBB’s monster taxes will throttle growth, investment and jobs. So this isn’t merely pouring gasoline on an inflation fire; it’s nuking an entire economy.
Americans are worried, which is why Biden himself took to the airwaves last week trying to calm fears. Yet telling families their “disposable income” is up thanks to handouts can’t hide what folks see for themselves at the grocery store and gas pumps: dramatic price surges that make their dollars buy less.
They know another multitrillion-dollar injection from BBB will only push up prices more, hitting the poor hardest: 43 percent said the bill will make inflation worse, while just 26 percent said better, a Morning Consult/Politico poll found — and while 14 percent of those making over $100,000 thought it would make price-hike woes “much better,” only 7 percent of those making under $50,000 thought it would.
Biden himself admits the Dems’ March stimulus helped drive up prices, yet now he wants to do the same thing again, expecting different results. Doesn’t he know the definition of insanity?
