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America’s Most Important Economic Storyteller Is Confused

By Derek ThompsonThe Atlantic

As somebody who’s paid to tell stories about the economy, I always find it satisfying to assemble data points to produce a compelling pointillist picture about the state of the world. But these are rough times for economic pointillism. The data are all over the place, and the big picture is a big mess.

I look at the stock market, where valuations have collapsed. Okay, so markets are trying to tell us that future growth will be slower. Then, I see that consumers expect persistent inflation over the next five years. A growth slowdown with sticky inflation? Unusual, but not unprecedented. Consumers are glum about economic conditions but optimistic about their own finances, and they’re spending money on services and leisure and travel as if they’re eager participants in a booming economy. So everything is terrible, but I’m doing fine? Okay, that’s psychologically rich. Nominal gas prices are at record highs, but unemployment is near multi-decade lows; mortgage interest rates are rising quickly, but they’re at historically normal levels. So, things are bad, but also good, but also crummy, and maybe fine?

Regrettably, there’s another, significantly more important economic storyteller that also seems deeply confused about the economy. That would be the Federal Reserve.

Just six months ago, the Fed said it expected that prices would normalize in 2022, and it forecast that a key inflation index would average 2.6 percent growth this year. But now it projects that 2022 inflation will be twice as high, at 5.2 percent. Three months ago, the Fed signaled that it would raise a key interest rate by 0.5 percentage points in June. But this week, the Fed changed its mind after getting spooked by a few inflation reports and suddenly decided to jack up the federal-funds rate by 0.75 points, its most significant increase in 28 years.

Fed Chair Jerome Powell’s explanation for the rate change was baffling. He claimed that the number of job openings in the economy pointed to “a real imbalance in wage negotiating” but also said that the labor market had practically nothing to do with inflation. He explained that headline inflation has soared largely because of supply-side issues, such as the war in Ukraine’s impact on the gas market, that the Fed can’t really do anything about. But he also insisted that the Fed had to up the ante on interest-rate hikes to bring down inflation by reducing demand. He insisted that he didn’t want to send the economy into a recession, but the Fed’s own economic forecasts project several consecutive years of rising unemployment—something that generally happens only in a recession.

The full story only barely holds together. In the Fed’s view, inflation is partially caused by the labor market, but also not caused by the labor market; it’s largely a supply-side issue that the Fed can’t fix, but the Fed is going to try desperately to fix it anyway; and we’re hopefully not getting a recession, but we’re probably getting a recession. Like I said: baffling.

What the Fed is actually trying to do here—as opposed to the story it’s telling about what’s happening in the economy—is clear, yet extremely difficult: It is trying to destroy demand just enough to reduce excess inflation but not so much that the economy crashes. This a little bit like trying to tranquilize a raging grizzly bear with experimental drugs: Maybe you bring down its core temperature but also maybe you leave the big guy in a coma. The Fed could succeed. It could get Americans to spend a little less, borrow a little less, and loan a little less, and this synchronized decrescendo in economic activity would almost certainly reduce inflation. But here’s the problem: If global energy prices don’t come down and global supply chains remain tangled by Omicron variants and other natural disasters, we might end up with the worst of both worlds: destroyed domestic demand and constricted global supply. Slow growth and high energy prices could mean the return of the dreaded stagflation.

In the next few months, you should be prepared for the economic situation to get even stranger. Markets might be on the lookout for signs that the Fed is successfully crushing domestic demand. In other words, some investors will be hoping that the housing market stalls and retail spending slows, because these are signs that the Fed’s policy is working. We will be in an upside-down world where bad news (the economy is slowing down) is interpreted as good news (the Fed’s policy is working), and good news (consumer spending is still red hot) is interpreted as bad news (the Fed’s policy isn’t working).

For much of this century, the Fed has been an island of relative competency in a sea of institutional failure. But the Fed is neither an all-knowing artificial intelligence nor a band of wizard oracles sent from the future to stabilize price levels. The people who work there are fundamentally pundits with an interest-rate lever. They’re folks like you and me, telling stories about an economy that they’ve recently gotten wrong, wrong, wrong, and then kinda right, and then wrong again. I don’t know if this is comforting or terrifying to you, but it’s the full truth: Right now, we are truly all confused together.


There Is No Plan

The closer attention you pay to Biden, the less he has to say

By Matthew ContinettiThe Washington Free Beacon

Getty Images

President Joe Biden is “rattled,” according to NBC News, and “looking to regain voters’ confidence that he can provide the sure-handed leadership he promised during the campaign.”

How? By trying to change the media narrative. On May 30, Biden published an op-ed in the Wall Street Journal that explained “My Plan for Fighting Inflation.” The next day, Biden wrote a “guest essay” for the New York Times on “What America Will and Will Not Do in Ukraine.”

Bad poll numbers and a collapsing domestic and international situation have excited the typically drowsy president into action. There’s a problem, though. The closer you read Biden’s op-eds, the less he has to say. This new, annoyed, engaged Biden may be a prolific writer and speaker. But he’s not an incisive one. He won’t admit that there is a connection between his ideology and America’s problems. He can’t decide between giving Ukraine the weapons necessary to defeat Russia or settling for a war of attrition.

Biden’s Journal op-ed is a masterclass in passing the buck. He doesn’t bring up his “plan for fighting inflation” until midway through his thousand-word piece. My inner college professor wanted to send the article back to him with suggestions for revision. Number one: Always move your best material to the top!

The plan itself is gauzy and thin. “The Federal Reserve has a primary responsibility to control inflation.” You wouldn’t know that from listening to Progressives, including some of Biden’s nominees to the Federal Reserve, who argue that the Fed’s interest in price stability distracts it from promoting full employment, green energy, and diversity, equity, and inclusion. Now Biden wants the Fed to correct not only its mistakes, but his own. Let’s see if his faith in an independent central bank can stand the test of higher interest rates, higher unemployment, and lower incomes.

Parts two and three of Biden’s inflation plan are the remnants of his Build Back Better agenda: some clean energy and housing subsidies here, a few tax hikes there. He mentions his use of the Strategic Petroleum Reserve to lower gas prices, but not his appeals to Venezuela and OPEC to boost the oil supply. As for the obvious answers to America’s energy problems—a complete reversal of Biden’s hostility to oil and gas exploration and production, huge investments in nuclear power, and emergency efforts to increase refinery capacity—Biden has no words. His devotion to the environmental lobby and to green energy blinds him. If the Progressive Left rejects nuclear power, the “clean energy future” it desires won’t arrive.

This mismatch between ends and means is visible in Biden’s Ukraine policy. The president tells New York Times readers that the United States sends Ukraine weapons “so it can fight on the battlefield and be in the strongest possible position at the negotiating table.” The desired end state is “a democratic, independent, sovereign, and prosperous Ukraine with the means to deter and defend itself against further aggression.” And Ukrainian president Volodymyr Zelensky is in the driver’s seat. “I will not pressure the Ukrainian government—in private or public—to make any territorial concessions.”

All good. Why, then, limit the weapons deliveries to systems with ranges of 40 miles? Why slow-walk and agonize over each tranche of support? Why engage with Russia in farcical and dangerous negotiations over Iran’s nuclear weapons? Why not take a more active role in peace talks between Ukraine and Russia? The Biden policy is static even as the shape of the war changes in ways that favor the aggressor. The president’s goals are laudable. But his tactics are calibrated for a war that Ukraine is winning.

And Ukraine is not winning. At least not now. The Ukrainians defeated Russia’s attempt at regime change. But they have been less successful in removing Russia from eastern Ukraine and from their port cities in the south and southeast. Absent a change in Biden administration policy—in the ranges of weapons systems America provides Ukraine, in the establishment of a humanitarian corridor to relieve the Russian blockade of Ukrainian Black Sea ports, or in a major diplomatic effort—the war will turn into a frozen conflict with no clear resolution and with mounting humanitarian costs. How that situation would help anyone, including Biden, is unclear.

Then again, little Biden says or does makes sense from the vantage point of either policy or politics. He’s right to be rattled. He’s also clueless.


‘Out of Touch With America’: Biden’s Small Business Budget Makes No Mention of Inflation

Budget proposal requests millions for 'climate crisis'

By Patrick HaufThe Washington Free Beacon

A shuttered storefront in Cairo, Ill. / Getty Images

While the Biden administration’s small business budget references environmental initiatives more than 20 times, it makes no mention of inflation’s impact on businesses—a contrast that Republican lawmakers say shows a disconnect between the White House and American voters.

The Small Business Administration’s 2023 budget proposal, which the White House in March submitted to Congress for approval, lists the “climate crisis” as an agency priority, requesting $10 million toward environmental initiatives such as the replacement of federal government vehicles with zero-emission cars. The request, meanwhile, makes no mention of rising consumer prices, which in March hit a four-decade high of 8.5 percent—even as recent polling shows inflation is a top concern for business owners. Four out of five small business owners say their companies have “suffered” from inflation, according to an April Goldman Sachs report.

Sen. Joni Ernst (R., Iowa), a member of the Senate Small Business Committee, said the budget is “out of touch with America and reality.”

“The president and his SBA administrator are more focused on appeasing climate activists than helping Americans on Main Street,” Ernst told the Free Beacon. “They need to get a clue.”

The Small Business Administration told the Free Beacon that while inflation is not explicitly mentioned in the budget, the agency’s proposed funding for domestic production and global supply chain programs will help small businesses struggling with rising prices.

“We remain committed to advocating for all our entrepreneurs, including supporting several initiatives in the FY22 budget dedicated to lowering costs for Americans,” an agency spokesman told the Free Beacon.

The White House in recent months has blamed rising prices on global supply chain shortages and the war in Ukraine. Some economists, however, have warned that the Biden administration’s record spending has been the main driver of surging inflation. President Joe Biden’s American Rescue Plan, which Congress passed last year, cost an estimated $3.5 trillion. The Small Business Administration, through its Paycheck Protection Program, has forgiven $714 billion in loans to businesses that maintained their staff amid the pandemic.

“This inflation is caused by trillions of newly ‘minted’ dollars flowing through the economy and government-created supply shortages from overregulation and restrictions on society the past two years,” Joel Griffith, a research fellow at the Heritage Foundation who focuses on financial regulations, told the Free Beacon.

Congress will review the Small Business Administration’s proposed budget as it prepares to draft appropriations packages later this year. Several Republicans on the House Small Business Committee, including Beth Van Duyne (Texas), Byron Donalds (Fla.), Dan Meuser (Pa.), and Blaine Luetkemeyer (Mo.), told the Free Beacon the administration is putting left-wing policies above pressing economic concerns.

The budget “does just the opposite of addressing inflation: more reckless spending on policies straight from the Democrats’ radical and extreme agenda,” Luetkemeyer told the Free Beacon.

A Gallup poll in March found that climate change is the top issue for only 2 percent of Americans. Inflation and increased cost of living, meanwhile, are the top concern for 17 percent. Sen. Marco Rubio (R., Fla.), also a member of the Small Business Committee, said the Small Business Administration’s priorities are misaligned.

“Every small business owner I talk to is being hammered by inflation, and that’s on top of supply chain delays and a labor shortage,” Rubio told the Free Beacon. “But no one in the Biden Administration seems concerned about the fate of small businesses because they’re too busy pushing some radical, woke nonsense that won’t help anyone on Main Street.”


It’s Time Our Country Stop Emboldening Our Enemies

By Eric SchmittTownhall

It's Time Our Country Stop Emboldening Our Enemies
Source: AP Photo/Manuel Balce Ceneta

Inaction by the Biden administration and an aversion towards long-term strategic policy goals has put the United States in an exceedingly vulnerable position, with China and our adversaries aggressively advancing their plans to overtake the United States on the world stage. 

Our nation’s current leadership has failed to act on forward-thinking initiatives to strengthen the economic and national security of America. It is imperative that new voices be sent to Washington who recognize future challenges and implement strategic plans to protect the wellbeing of American industry, security and freedom.

The Russia-Ukraine conflict underscores the need for a comprehensive plan to confront geopolitical and domestic challenges before they arise. This conflict was driven by Joe Biden’s withdrawal of United States Energy Independence at the world stage, all while the intelligence community and lawmakers having advance knowledge of a Russian invasion into Ukraine. Instead of acting to deter the Russian threat, lawmakers and the Biden administration failed to issue a preemptive sanction package. By lacking the foresight and courage to act, Biden disgraced American diplomacy and strength on the world stage.

It’s paramount that our next class of lawmakers address the needs of tomorrow’s America and develop long-term policies that strengthen United States national security and economic interests. I led the fight for energy independence and stood with President Trump’s successful policies by suing the Biden administration over the cancellation of the Keystone XL Pipeline and filed suit against Biden’s disastrous ‘Social Cost of Greenhouse Gas’ rule. We must strengthen the American energy sector, and never become a pawn of another nation’s exports.

The lab leak in Wuhan, China exposed critical vulnerabilities in our country’s national security and economy. As Missouri Attorney General, I’ve fought China at every turn, suing the Communist Chinese Party in 2020 to hold them accountable for unleashing COVID-19 on the United States. But more must be done. We must eliminate funding for gain of function research, as seen in the NIH-funded Wuhan lab. The United States, through financing the NIH lab in Wuhan, placed an economic weapon in the hands of our greatest adversary. 

This is an unacceptable lack of foresight our country can never allow to happen again. In the U.S. Senate, I will be relentless in my pursuit to hold accountable, whether foreign or domestic, those responsible for unleashing the pandemic on the world.Through Iran-Contra-like investigations, I will ensure that our enemies will never have the opportunity to use American research funding against us again. 

Energy independence and opposing China, along with the foresight and willingness to take on these big fights like President Trump did so effectively is what our country needs, with the threat to our nation at the highest point in decades. International turmoil, rising inflation, and economic stagnation embolden our enemies and have been perpetuated by the Biden administration. We must do better. We need fighters. And we need long-term solutions. That’s why I’m running for the United States Senate.


Inflation proves Biden has done everything wrong all at once

By Kevin D. WilliamsonThe New York Post

Biden's administration has blamed soaring inflation on Putin and called it "transitory" but failed to face up to the real problem — their own terrible economic policies that have made matters worse.
Biden’s administration has blamed soaring inflation on Putin and called it “transitory” but failed to face up to the real problem — their own terrible economic policies that have made matters worse. Getty Images

Our increasingly ugly inflation problem is a perfect illustration of the Biden administration’s uncanny ability to get everything everywhere wrong all at once.

The Biden administration’s first response to any problem is to pretend that it isn’t a problem. That’s how inflation went from a minor problem to a major one. Unwilling to take the necessary steps to rein in inflation early — pushing the Fed to raise interest rates and slowing down the torrent of money going out the Treasury’s doors — Biden and congressional Democrats at first insisted that inflation wasn’t a real problem: “Transitory,” they called it.

And then when inflation turned out not to be transitory, they thought they could just pin it on the Russians. Jen Psaki sniffed smugly at the “Putin price hike,” as though Americans were too stupid to understand that inflation at home had started long before the Russian invasion of Ukraine. That gambit fizzled, too.

When you don’t have any fresh ideas or real principles — and when your long-term goals are limited by the fact that the president, who was born during the Roosevelt administration, isn’t exactly buying any green bananas — then the easiest thing to do is to throw money at every problem.

The Biden administration has found a convenient — and easy — target in Russian leader Vladimir Putin, blaming him for the inflation spike. But inflation was rising before the Ukraine war.
The Biden administration has found a convenient — and easy — target in Russian leader Vladimir Putin, blaming him for the inflation spike. But inflation was rising before the Ukraine war.

Throwing money at things is how you make inflation worse.

Washington had already thrown a lot of money at the economy during the COVID-19 emergency, and, predictably, the emergency spending outlasted the emergency. By the time Biden was elected in 2020, Washington had thrown $2.6 trillion in budgetary resources at COVID and had authorized as much as $4 trillion in subsidized federal lending. That was new money amounting to about a third of GDP sloshing around the economy. Biden’s first priority was pushing out another $1 trillion in a phony infrastructure bill (that has little to do with actual infrastructure) and a $1.9 trillion stimulus bill, even though the Consumer Price Index was already rising steeply, according to the Federal Reserve.

Our inflation problem is only partly an issue of dovish monetary policy and reckless spending. There are problems in the real-world physical economy, too, those “supply-chain issues” we hear about. The Biden administration has done extraordinarily dumb things to make these worse, too, keeping in place the worst of the Trump administration’s anti-trade policies. That “Made in the USA” talk sounds good on the stump, but the truth is we need a lot that we don’t make at home and aren’t going to — including much of the steel and other vital inputs for the high-value manufacturing we actually do here.

The incredible fact is the Biden administration still had punitive tariffs on Ukrainian steel while it was seeking financial aid for the Ukrainians — it wasn’t until the Chamber of Commerce and conservative critics started making a stink that the administration changed its stance.

Container ships wait to dock at Los Angeles harbor. Biden policies have hindered efforts to improve port efficiency, further adding to the current supply-chain crisis.
Container ships wait to dock at Los Angeles harbor. Biden policies have hindered efforts to improve port efficiency, further adding to the current supply-chain crisis.

Biden has rejected obvious reforms such as waiving the Jones Act, which keeps goods — and fuel — from moving from one US port to another via ship. It has backed union efforts to prevent operators from improving the capacity and efficiency of our ports through automation, sacrificing that progress in favor of a make-work policy for the benefit of longshoremen. Nearly none of that “infrastructure” money has made its way to any project that would actually ease supply-chain issues.

Interfering with trade during a supply-chain crisis is how you make inflation worse.

The United States, Canada and Mexico together make up a formidable energy superpower. But it does not matter how much oil and gas you have if you cannot get it to refineries and then get the refined products to consumers. Biden killed the Keystone XL pipeline, and his EPA is standing on the neck of developing any new conventional energy infrastructure. As gasoline prices skyrocket, US refineries in the Gulf are sending much of their gasoline to Mexico to be sold, because there is no economic way to get it to the Northeast or the West Coast.

Biden killed the Keystone XL pipeline that would have helped expedite the shipment of crude oil across the US. Instead, we are buying much of our oil from overseas.
Biden killed the Keystone XL pipeline that would have helped expedite the shipment of crude oil across the US. Instead, we are buying much of our oil from overseas.

Biden is contemplating a trip to Saudi Arabia to beg OPEC to produce more oil —apparently, nobody has told him that Midland, Texas, is a hell of a lot closer.

Driving up energy prices for no good reason is how you make inflation worse.

Inflation is sometimes associated with a booming economy, but our economy shrank in the last quarter. Biden, who was in the Senate in the 1970s, is old enough to remember the word “stagflation,” which is what you get when you have a stagnant economy and inflation at the same time.

With inflation hitting levels not seen in over four decades, global stock markets are tanking — taking personal savings and 401k accounts down with them.
With inflation hitting levels not seen in over four decades, global stock markets are tanking — taking personal savings and 401k accounts down with them.

And it is what you get when you combine the wrong monetary policy with the wrong fiscal policy, the wrong trade policy, the wrong regulatory policy, and the wrong energy policy. 

And that’s how you make inflation worse.


Pop Goes the Presidency

Biden gets desperate

By Matthew ContinettiThe Washington Free Beacon

Getty Images

A wise man once said: “When the economy is bad, people blame the party in power. When the economy is good, people look at other issues.”

Well, the economy is bad. Nice-sounding growth, job, and wage numbers do not count for much when the American standard of living is in decline. Inflation has outpaced income gains since last year. It remains at a 40-year high. Gas costs more than four dollars per gallon—sometimes much more—in every state. Americans under 40 years old are experiencing consumer delays, shortages, and scarce necessities, including baby formula, for the first time in their lives. According to the Pew Research Center, 70 percent of Americans say that inflation is “a very big problem.”

It’s also a very big problem for the party in power. President Biden’s economic approval rating is 34 percent in the most recent CNN poll. His overall job approval rating is 41 percent in the FiveThirtyEight average of polls. Republicans have held a slight but durable lead in the congressional generic ballot since last October. The midterm election is less than six months away. To preserve their narrow majorities in Congress, Democrats need to change the trajectory of this campaign. Right now.

Their solution? Pretend that the election isn’t a referendum on Biden’s job performance but a choice between Biden and Donald Trump. Scare voters with references to the extremism of the right. Invoking Trump alone is not enough, however. Terry McAuliffe tried that approach during last year’s Virginia gubernatorial campaign and it flopped. McAuliffe lost. Running against Trump and the Make America Great Again (MAGA) movement doesn’t work when Trump is neither president nor on the ballot. Democrats have convinced themselves that victory in the fall requires something scarier than MAGA. It requires Ultra-MAGA.

On May 10 Biden contrasted his policies with the “Ultra-MAGA Agenda.” Haven’t heard of it? According to Biden, it’s the brainchild of Senator Rick Scott of Florida, head of the National Republican Senatorial Committee. (In his remarks, Biden erroneously said Scott hails from Wisconsin.) Back in February, Scott released a policy document that remains controversial within the Republican Party and that few Republican candidates have endorsed in full.

Biden isn’t subtle. He wants to use Scott’s proposals as an electoral cudgel, just as Barack Obama campaigned against Paul Ryan’s “Path to Prosperity” in 2012. Hence Biden’s description of “the ultra-MAGA plan put forward by congressional Republicans to raise taxes on working families; lower the incomes of American workers; threaten the sacred programs American count on like Social Security, Medicare, and Medicaid; and give break after break to big corporations and billionaires.” Biden says that his foes are not ordinary Republicans. They are not run-of-the-mill Trump voters. They are “Ultra-MAGA Republicans.”

Someone has been spending too much time in focus groups. The Biden administration and congressional Democrats must think that the prefix “ultra” makes a noun sound spooky. But the president and his underlings will have to specify who really counts as an Ultra-MAGA Republican, what the Ultra-MAGA agenda entails, and when “ultra” should be capitalized before voters stop worrying about rising prices, violent crime, insecure borders, and craziness in schools. In its current usage, “ultra-MAGA” comes across as comical. It’s a hackneyed slogan. Some people may even find it appealing.

White House press secretary Jen Psaki told reporters the other day that “ultra-MAGA” is the president’s coinage for Republicans who support Rick Scott’s plan, Justice Samuel Alito’s draft opinion returning abortion law to the states, and Governor Ron DeSantis’s (R., Fla.) fight with Disney. “And so,” said Psaki, “to him, adding a little ‘ultra’ to it, gives it a little extra pop.”

A little extra pop? What is Psaki talking about—a new flavor of Pringles?

The Democrats are unable or incapable of running on their accomplishments. Their economic agenda is discredited among voters grappling with inflation. Their traditional advantage on education has narrowed because of parental fury at school closures, mask rules, confusing COVID guidance, and politically correct school boards. They have fallen back on scaremongering and name-calling.

Not for the first time. Nor for the last. Expect the alarm bells to ring louder as autumn approaches. By Election Day, Biden will have moved from “Ultra-MAGA” to “Mega-MAGA,” “Super-Duper MAGA,” “MAGA Deluxe XXL,” and, in homage to his love of ice cream, “All-Out Triple Scoop Chunky Monkey MAGA with Extra Deplorables.” Voters will respond as they usually do when Biden speaks. They will ignore him.


Voters Call Biden a Weak Commander-in-Chief

By Peter RoffAmerican Liberty

Voters Call Biden a Weak Commander-in-Chief

 Despite pushing Congress to approve an additional $33 billion in lethal aid to Ukraine amidst its ongoing effort to repel Russian invaders and drive them from their homeland, U.S. voters still regard President Joe Biden as a weaker leader than any of his predecessors.

The polling firm Rasmussen Reports queried 1,000 U.S. voters likely to cast ballots in the next election about their feelings regarding Biden’s leadership. Only 24 percent of those who responded said they found him to be a “stronger commander-in-chief” than those who preceded him in office.

The public’s view of Biden’s ability to handle pressing issues of national security was undoubtfully shaped unfavorably by the sudden, chaotic withdrawal of U.S. troops from Afghanistan that took enemies and allies alike by surprise.

In the ensuing chaos, people who had worked with the United States forces and those who had partnered with the Americans on national building projects under George W. Bush and Barack Obama found themselves left behind, unable to get out of the country now that the various provinces and capital city of Kabul had come under the control of the Taliban.

The findings in the latest poll, Rasmussen Reports said, were largely unchanged from November 2021, before the Russians launched their unprovoked invasion of Ukraine. In that survey, 57 percent of respondents said Biden was weaker than his predecessors.

Supporter for Biden has been steadily declining since he came into office. His job approval rating in various polls, which started above 60 percent, has dropped into the low 40s and threatens to go even lower as the election nears, due in the main to the perception the current administration has done a poor job controlling inflation and has shown little concern for its impact on the working men and women who used to make up the bulwark of the Democratic Party’s winning electoral coalition.

Shockingly, two-thirds of those responding to the survey who are current or former members of the U.S. military – 64 percent – agreed Biden was a weaker leader than those who came before him. Though only a small part of the survey – 15 percent – their educated opinion on such matters is not something the current administration should ignore going forward.

According to the Rasmussen analysis, not even half of the Democrats who answered the survey conducted online and by telephone would say Biden was “stronger.” Just 41 percent of those in the president’s party agreed with that position, as did 8 percent of Republicans and 21 percent of independents polled. A whopping 84 percent of likely GOP voters said Biden “is a weaker commander in chief compared to most recent presidents,” as did 26 percent of Democrats and 60 percent of unaffiliated voters.

When it comes to dealing with other world leaders, 60 percent of all likely voters found Biden to be “less aggressive than most recent presidents in pushing what’s best for America.” Only 23 percent said he was more aggressive, while just 12 percent said he was “about the same” in pushing for America’s interests.

Those finding Biden “less aggressive” included 80 percent of Republicans, 37 percent of Democrats and 64 percent of unaffiliated voters.

The survey of 1,000 U.S. Likely Voters was conducted on April 24-25, 2022, by Rasmussen Reports. The margin of sampling error is +/- 3 percentage points with a 95% level of confidence.


Biden is Losing. Period

By Peter RoffAmerican Liberty

Biden is Losing. Period

The Biden administration is over. Sure, he has another two years plus in the White House and might even win a second term (if he runs and if the GOP nominates an unelectable candidate), but he’s lost the ability to set the agenda for the country, and he’s not getting it back.

Some people argue he’s been derailed by events which, as former British Prime Minister Harold Macmillan famously said presented the biggest challenge to any administration, but that’s not true. Biden and his people have exhibited a degree of organizational incompetence and a tin ear for the public sentiment on key issues.

Emblematic of all this is special climate envoy John F. Kerry, a former Secretary of State and the 2004 Democratic nominee for president. He cheerfully travels the world in private jets to receive awards for his work combatting global warming, is caught flying maskless on commercial flights despite his own administration’s transportation masking mandate and reacts to the Russian invasion of Ukraine by voicing concerns it will distract from the effort to move the economy of the West away from its reliance on fossil fuels.

Kerry’s also dismissive of the job losses and economic dislocations that would occur if, as the Biden administration is pushing for, the U.S. economy were to transition from one dependent on fossil fuels to one where renewables were the dominant energy source. He called that an “opportunity” rather than a major crisis for millions of working-class families and employees in the energy sector. Maybe they can just learn to code or grow Belgian endive.

It’s hard to imagine anyone more out of touch with the hoi polloi than that. Unfortunately for us all, Kerry is just the tip of a very large iceberg of party leaders and policymakers indifferent to the needs of hard-working Americans trying to find their way back to prosperity and economic security in the face of rising interest rates and record inflation.

Biden doesn’t have a plan to deal with any of it. He says he does, but that’s posturing. The White House announced with great fanfare nearly a month ago that the president has authorized the release of fuel stocks held in the nation’s strategic petroleum reserves to blunt the spike in the price of gasoline he blamed on Putin.

To set the record straight, gas prices were rising before Putin launched his attack. Energy prices are going up because of Biden’s policies, not global events. Yet the contracts to get the oil in the SPR to market were only completed Thursday. Good thing there wasn’t a real emergency like a nation hostile to the United States or a terrorist group seizing or disabling the Suez Canal.

As for inflation across the economy, the New York Federal Reserve Bank has shown that inflation took off appreciably in 2021, the first year Biden was in office. Even former Obama-Biden Economic Advisor Jason Furman said the inflation now reducing the purchasing power of working Americans is not transitory as the White House originally tried to claim but will instead continue due to increased demand created, as the RNC recently pointed out, by excess savings built by the Democrats’ endless government checks from their $2 trillion so-called COVID stimulus.

All this is costing Biden, as is his failure to push the Build Back Better legislation through Congress or to achieve any progress on the other critical campaign promises he made to the voters who chose to back him in the primary over Vermont Sen. Bernie Sanders or in the general election against former President Donald Trump.

Much of this is borne out in the latest Gallup Poll, which shows the president to be “stuck” – to use the word employed by the venerable polling firm – in an unpopular place. “During Joe Biden’s fifth quarter in office, which began on January 20 and ended on April 19, an average of 41.3 percent of U.S. adults approved of the job he was doing as president. The latest average is essentially unchanged from the 41.7 percent in his fourth quarter but significantly lower than his first three quarterly averages.”

To put this in perspective, Biden’s latest rating “is lower than that of any prior elected president,” Gallup said, save for Trump, who nonetheless is consistently polling ahead of the current president in polls testing how each would fare in a potential 2024 rematch.

Between then and now, of course, is the 2022 midterm election. Forecasters are predicting the GOP will win control outright, not just of the U.S. House of Representatives but Congress as a whole, further burying Biden’s ability to set the agenda.

Gallup’s analysis of the latest numbers confirms this, saying the president’s low job approval numbers – which are unlikely to improve before the election and it would be ahistorical if they did – stand as “a significant threat to the Democratic Party’s chances of maintaining its slim majorities” in Congress after November. “Typically, unpopular presidents’ parties have lost seats in midterm elections, with the number of seats lost usually much higher for presidents with job approval ratings below 50 percent.”

If the GOP wins control of Congress, it may prove to be the president’s political salvation. Just as Bill Clinton was helped immeasurably by his party’s losing control of the legislative branch in 1994 to Newt Gingrich and the Contract with America Congress, Biden may find it easier to moderate his positions and engage in successful negotiations to get legislation to his desk if he no longer must concern himself with the ability of “The Squad” and other extreme progressives like Sanders and Massachusetts Sen. Elizabeth Warren to tank any bill them deem to be insufficiently socialist-leaning all by themselves.

Like Clinton, Biden would look like the moderate he claimed to be in the campaign by agreeing to Republican efforts to bring in budgets that look balanced, rein in the rate of increase in federal spending, get inflation under control, require work once again in exchange for welfare payments, continue real criminal justice reform, make it easier to start and fund charter schools and do other things that have appeal to suburban voters and working Americans.

If Biden and his staff are smart enough to realize this is how to play the hand the voters are about to deal them, then he becomes a much stronger candidate for a second term – just not on the terms he and others close to him might like. If they go into 2024 forcing the American electorate to choose between heading left or heading right, Biden – or whoever the Democratic nominee is – will almost certainly lose.


HIGHER U.S. ENERGY PRICES ARE BIDEN’S FAULT

By Peter RoffStories In The News

For at least a decade, American progressives have been waging war on the nation’s energy sector. They’re all in on wind and solar and are using scare tactics, tax breaks, and government preferences to push a Green Agenda that leaves zero room for oil, coal, or natural gas.

That’s the real Biden policy, fulfilling a vow he made in September 2019: “I guarantee you, we are going to end fossil fuel.” And for the past 15 months, the president has done his best to keep that commitment.

Such grandiose plans come at a price. Biden’s anti-fossil energy positions are causing tremendous political harm to himself and his party. Prices are up. His approval is down. His solution? Pass the buck, as the White House did recently when it called the spike in energy costs “Putin’s Price Hike.”

The people aren’t buying. Only 27 percent of voters in a recent Winston Group survey agreed America must “reduce reliance on oil and gas even if it means higher costs because that is the only way to ensure a transition to alternative energy.” By more than two to one they believe, the nation should continue to rely on oil and gas to meet current energy demands while “transitioning over to alternative energy” sources.

America’s current energy needs conflict with the Biden Administration’s climate policy priorities, but that doesn’t stop progressives from arguing the need for more green energy and less traditional fuels. Even when the average national price at the pump is well over $4 a gallon.

Energy costs are the main driver of inflation. In 2021, they were up 29 percent over the previous year. The price of gasoline surged, fuel oil costs jumped 41 percent, and overall yearly inflation hit an alarming 7 percent. The Biden people haven’t got a clue. In early March White House Press Secretary Jenn Psaki incorrectly claimed the administration’s energy policy was not to blame for increased prices. When pressed, she argued “The Keystone Pipeline was not processing oil through the system. That does not solve any problems. That’s a misdiagnosis or maybe a misdiagnosis of what needs to happen.”

It’s Psaki who made the “misdiagnosis.” An operational Keystone XL would have augmented the capacity of an existing pipeline running from Alberta, Canada to Superior, Wisconsin, delivering 830,000 additional barrels of oil a day.

Biden’s vilification of the oil and natural gas industry at a time when it’s needed to keep the economy and the country going is not new. Since its earliest days, his administration has pushed the cost of conventional fuels up through the Keystone XL Pipeline cancellation and the moratorium on new oil and gas leases on federal lands. Republican Rep. Jim Banks of Indiana recently released a study identifying more than 80 specific actions the Biden Administration has taken on energy-related matters that have helped boost the price at the pump. In Banks’ words, “President Biden has waged an unprecedented, government-wide assault on our nation’s ability to produce cheap, reliable energy.”

That’s why Americans have seen a steady increase in energy prices, not the invasion of Ukraine. Biden’s moratorium on federal leases is another problem. Many current leases are tied up in litigation. New leases on federal land were brought to a halt. The administration’s refusal to renew the Interior Department’s five-year offshore leasing plan, set to expire at the end of June has imposed a further strain on production. If the plan is not renewed, expect overall fuel production to drop by the tune of 500,000 fewer barrels of oil and gas produced per day from 2022 to 2040.

The United States Energy Information Administration’s Annual Energy Outlook 2022 predicts petroleum and natural gas will be the most used fuels in the U.S. through the year 2050. That’s reality – unless the government intervenes by imposing mandates that restrict or ration the production and use of fossil fuels.

That’s a problem domestically and internationally. Having the ability to turn the spigot on here at home, means there’s no need to reach out to hostile countries with offers to alleviate economic sanctions placed on them over their disregard for human rights and the threats they pose to the United States in exchange for access to their oil reserves. That’s a fool’s bargain – but one America’s current leadership is telegraphing it is ready to make.

Even without the war in Ukraine, people have realized we need abundant, reliable oil and gas “made in America.” Going to other countries is not the answer, nor is making an expensive, lengthy, transition to renewable sources that compromises our economic strength and national security.

We must increase oil and gas production in the U.S. now. We have the resources – we need the administration to get out of the way of developing them.


Don’t Blame Jones Act for High Energy Prices

By George LandrithNewsmax

illustration of an oil pipeline
Oil pipelines are the real answer to easing high energy prices. (Dreamstime)

Increased energy prices in the wake of Russia’s war on Ukraine have caused critics of the Jones Act to claim the law is contributing to more expensive domestic petroleum products.

The law merely limits waterway shipping within the U.S. to American-built and -owned ships crewed by Americans, but its detractors falsely claim that repealing it would help lower costs.

The fact is the cheapest and safest way to move petroleum and natural gas products across a nation — and even a continent — is through pipelines.

The real culprit behind the high cost of transporting energy are extremists who oppose pipelines and prevent them from being built. Without such needed pipelines we will continue to pay too much to transport petroleum.

The Jones Act has nothing to do with these costs and in fact has many benefits. It is time for its opponents to stop playing politics.

As Americans have vividly seen in the last few years, building a pipeline is a political football. It takes years, even decades, to obtain the required political approvals.

And even once obtained, such permits can be reversed by know-nothing political activists. So this political circus arranged by these pipeline circus clowns means we overpay to transport oil.

The U.S. has more than 3 million miles of pipelines linking natural gas production and storage facilities with millions of American consumers — including homes. Those who argue that pipelines are inherently dangerous are simply wrong.

We have decades of data with millions of miles of pipelines — even going through neighborhoods. Pipelines are reliable, economical and safe.

Likewise, gasoline isn’t typically shipped in tanker trucks from refineries to local gas stations. There are pipelines that bring the gasoline to regional terminals. Then trucks take the gasoline from those terminals to local gas stations — thus limiting the miles that gasoline is transported via highway.

When extremists make it unnecessarily difficult to build this needed energy infrastructure, we can’t pretend the Jones Act is why we are overpaying to transport energy.

On the other hand, the Jones Act has a number of important benefits that its detractors would like to ignore.

The Jones Act simply requires that waterway shipping within the U.S. is done by American-built, -owned and -crewed ships. It doesn’t prevent foreign shippers from coming to our shores. But they can’t sail up our rivers and make multiple stops.

The Jones Act was intended to ensure that we have a viable shipbuilding and repairing capability to support our military. In a world where many foreign nations heavily subsidize their shipping industries, we must not allow ourselves to become dependent upon other nations to maintain our naval capability.

Former Vice Chairman of the Joint Chiefs of Staff, Gen. Paul Selva said, “I am an ardent Supporter of the Jones Act. [The Act] supports a viable shipbuilding industry, cuts cost and produces 2,500 qualified mariners.”

Likewise, Former Coast Guard Commandant, Admiral Paul Zunkunft said, “You take the Jones Act away, the first thing to go is these shipyards and then the mariners. … If we don’t have a U.S. fleet or U.S. shipyard to constitute that fleet how do we prevail?”

The military understands that the Jones Act is critically important to our national security.

Our adversaries would like a weaker America, not a stronger one. And the Jones Act helps keep us strong. If we haven’t learned in the past few years that being dependent upon hostile powers is both risky and costly, we haven’t been paying attention.

The Jones Act also has a significant impact on homeland security.

Dr. Joan Mileski, head of the Maritime Administration Department at Texas A&M, said, “If we totally lifted the Jones Act, any foreign-flagged ship could go anywhere on our waterways, including up the Mississippi River.” This would make our defenses incredibly porous as we have more than 25,000 miles of navigable inland waterways.https://e04e5a828992561bbe9773e12b110d72.safeframe.googlesyndication.com/safeframe/1-0-38/html/container.html

Michael Herbert, Chief of the Customs & Border Protection’s Jones Act Division of Enforcement said: “We use the Jones Act as a virtual wall. Without the Jones Act in place, our inland waterways would be inundated with foreign-flagged vessels.”

Without the Jones Act, Chinese Communist Party leader Xi Jinping or Russian President Vladimir Putin could gain access to America’s heartland, sending ships to operate up and down the Mississippi River. They could spy and even unleash weapons from container ships.

The Jones Act protects America. Blaming the Jones Act for the fact that extremists have hamstrung our nation’s energy infrastructure and driven prices up is a profoundly stupid argument.

The world is a dangerous place, filled with adversaries that will be all too happy if the Jones Act is weakened.


Biden Is Clueless About Inflation

The president's $5.8 trillion budget shows he wants more of the same government spending that is already sending prices through the roof.

By NICK GILLESPIE AND REGAN TAYLORReason

“My dad had an expression,” said President Joe Biden as he announced his budget plan for FY 2023. “Don’t tell me what you value, show me your budget, and I’ll tell you what you value.”

So at the very moment that we’re experiencing the highest inflation in 40 years, what does Biden value? The same sort of government spending that is already sending prices through the roof.

You’d figure that with Covid receding, debt rising, and a tidal wave of unfunded liabilities staring us right in the kisser, Biden would take the opportunity to radically reset the federal government’s balance sheet. Instead, his budget plan could be titled Rearranging Deck Chairs on the Titanic.

The president wants to spend $5.8 trillion, which would include jacking spending on defense, education, and police. He talks about levying a controversial—and probably unconstitutional—wealth tax on billionaires to help pay for it all but still expects a budget deficit of $1.2 trillion (see Table S1 in Summary Tables)! If you’re going to tax unrealized capital gains, President Biden, at least spend it on something pretty!

It’s debt-financed spending that helps spur inflation in the first place. Rather than cutting spending and reforming entitlements, the government borrows and prints money so it can keep giving more goodies to its favored citizens. You get more dollars chasing the same amount of goods, and that leads to price hikes.

Meanwhile, at least a dozen states—including such far-flung places as California, Georgia, Hawaii, and Maine—are thinking about giving residents money to spend on things like gas, the price of which has gone through the roof. “Direct relief will address the issue that we all are struggling to address,” says California Gov. Gavin Newsom. “That’s the issue of gas prices, not only here in our state, but of course, all across this country.”

Is he serious? Doling out tax dollars to alleviate the pain of inflation is like drinking a beer in the morning to ease your hangover. It’s only setting up the next binge.

Federal Reserve Chairman Jerome Powell has announced a series of interest rate hikes to help tame inflation, but in a recent speech, he made no mention of the increase in the money supply measured by M2, which has risen by a record 41 percent in two years, or of the Federal Reserve’s holding of U.S. debt, which has jumped $3.5 trillion over the same time period.

Powell’s interest rate hikes will be small enough that it’s unclear whether they will have much impact. Back in the 1980s, Fed Chairman Paul Volcker allowed the fed funds rate to more than double in less than two years’ time to over 20 percent, which helped kill inflation but also caused the most severe recession since the Great Depression.

According to recent conservative estimates from the Congressional Budget Office, as the federal budget grows, the cost of paying interest on the debt will keep increasing until it accounts for about 24 cents of every dollar spent by 2050. And that’s assuming interest rates will remain historically low.

So even moderate increases in the fed funds rate would push the cost of servicing the debt much higher, causing the government to borrow more money and kicking us into a vicious cycle of economic despair.

Biden can talk a good game about “returning our fiscal house to order,” but it’s clear he doesn’t understand why prices are going up—and that his policies will keep them high for the foreseeable future. That might cost Democrats control of the House and the Senate in the fall and perhaps Biden the White House in 2024.

That will be too bad for him and his party. But his unwillingness to confront massive spending and debt is going to cost all of us a lot more than that.


Biden Runs Out of Gas

The president has an unerring instinct to make problems worse

By Matthew ContinettiThe Washington Free Beacon

“This is a wartime bridge to increase oil supply into production,” President Biden said during his announcement Thursday that he would release more barrels of oil from the nation’s Strategic Petroleum Reserve than at any point in American history. His decision was also a concession. None of the policies Biden has enacted throughout his short presidency have alleviated the problems they were meant to solve. Quite the opposite: In practically every case, Biden has made things worse.

Energy? Killing the Keystone pipeline was one of the first things Biden did when he took office. In February, Biden delayed approval of new oil and gas leases. He continues to blame the increase in gas prices on Vladimir Putin’s invasion of Ukraine, even though prices began to rise early in Biden’s term. Biden scapegoats oil companies for sitting on profits, while he could be doing everything in his power to ramp up domestic production of available fuel sources—including nuclear.

The fallout from Putin’s war was bound to make energy scarce and thus more valuable. Biden could have lessened the pain on the American consumer by pursuing an all-of-the-above energy dominance policy from the start, and by reducing the size of the American Rescue Plan so that it didn’t contribute to inflation. He chose to ignore the warnings of economists such as former Treasury secretary Lawrence Summers and followed his advisers who incorrectly predicted that inflation would be temporary. By turning to the Strategic Reserve, Biden is promoting a temporary fix while the long-term solutions are plain to see. He’s relied on similar gimmicks before. They haven’t worked.

Consider Biden’s immigration policy. He spent his early days as president tearing up President Trump’s agreements with Mexico and several Central American countries that forced asylum-seekers to stay in third-party nations while U.S. judges decided on their claims. The rush for the border was swift and ongoing. This week, Biden is expected to reverse a rule Trump enforced during the coronavirus pandemic that allowed border agents to repatriate illegal immigrants swiftly because of the public health emergency. Homeland Security officials tell the New York Times that because of Biden’s decision they are planning on unauthorized crossings to double from an already high level. Republicans must be giddy with anticipation at the coming headlines.

Immigration and the border were the first places where you saw erosion in Biden’s job approval numbers last spring. Now he’s about to do something that will undermine border security and his political standing, and for no discernible reason. The pandemic is not over. Border crossings aren’t falling. We know that Biden’s decision will attract additional illegal immigrants. Nothing about this policy makes sense.

Biden doesn’t make sense. His Europe trip was a substantive success but a stylistic failure. The Western alliance is holding. But the president gaffed his way across Eastern Europe—saying the West would respond “in kind” to a Russian chemical attack, denying the deterrent value of sanctions when his subordinates have said precisely the opposite, telling U.S. troops that they would see the horrors of war in Ukraine firsthand, then raising the possibility that America’s strategic goal is regime change in Russia. Then, when Fox’s Peter Doocy soberly asked him about these inadvisable statements, Biden denied that he had said anything problematic.

I happen to believe that the world would be a safer place if Vladimir Putin were out of power—that indeed one possible consequence of a Russian defeat in Ukraine is Putin’s demise. I also believe that presidents shouldn’t sound like me. They need to watch their public statements because, as we were reminded throughout the Trump administration, words matter. Biden’s sentiment in Warsaw was correct. His sense of timing was wrong. After all, you never get in trouble for what you don’t say. Biden’s problem is that he rarely lets his actions speak louder than his words. And the words are garbled.

People notice. They don’t like what they hear, they can’t stand what they see. The public verdict on Biden is grim. He has not benefited from a rally-around-the-flag effect. His approval rating continues to fall. He’s at 41 percent approval in the FiveThirtyEight average of polls. He fell under 40 percent approval in this week’s Marist poll. Republicans continue to lead the congressional generic ballot. Democrats recognize that the electoral battlefield has widened. Biden is running out of time to improve his standing. And he hasn’t demonstrated an ability to bounce back as president.

Biden entered office at a time of national emergency. He benefited from the public’s desire to see Donald Trump off the airwaves for the first time in years. He oversaw the successful implementation of the vaccination program Trump had started. The resilience of the American economy helped him too.

Then the situation went sideways. Biden’s problems started on the southern border, ramped up with the Delta variant of coronavirus, accelerated with inflation, spread with the debacle in Afghanistan, and haven’t abated since. His rallying of the West in support of Ukraine is laudable, but he still hasn’t done enough to help the Ukrainians and he keeps stumbling on his own message. His commitments to the left wing of his party keep him from embracing the center. And damaging leaks about the federal investigation into his son’s finances only will mount if Republicans take Congress in November.

Biden’s reliance on the Strategic Petroleum Reserve is telling. This is a presidency that is running out of gas.


Fed Chair: Aggressive Rate Hikes May Be Needed To Tame Inflation

By Ann Saphir and Lindsay DunsmuirThe Washington Free Beacon

Fed chair Jerome Powell. /. Via Reuters

The U.S. central bank must move “expeditiously” to bring too-high inflation to heel, Federal Reserve Chair Jerome Powell said on Monday, and will, if needed, use bigger-than-usual interest rate hikes to do so.

“The labor market is very strong, and inflation is much too high,” Powell told a National Association for Business Economics conference. “There is an obvious need to move expeditiously to return the stance of monetary policy to a more neutral level, and then to move to more restrictive levels if that is what is required to restore price stability.”

In particular, he added, “if we conclude that it is appropriate to move more aggressively by raising the federal funds rate by more than 25 basis points at a meeting or meetings, we will do so.”

Fed policymakers last week raised interest rates for the first time in three years and signaled ongoing rate hikes ahead. Most see the short-term policy rate – pinned for two years near zero – at 1.9% by the end of this year, a pace that could be achieved with quarter-percentage-point increases at each of their next six policy meetings.

By the end of next year, Fed policymakers expect the central bank’s benchmark overnight interest rate to be at 2.8%, bringing borrowing costs to a level where they would actually start biting into growth. Most Fed policymakers see the “neutral” level as somewhere between 2.25% and 2.5%.

Powell repeated on Monday that the Fed’s reductions to its massive balance sheet could start by May, a process that could further tighten financial conditions.

U.S. stocks extended earlier losses after his remarks and traders boosted bets that the Fed will deliver a half-percentage-point rate hike at its policy meeting in May.

“This is not just going to be a near-term tactical phenomenon,” said Kevin Flanagan, head of fixed income strategy at WisdomTree Investments in New York. “This is a more strategic type of messaging, I think, from the Fed.”

A consensus for more aggressive tightening – or at least an openness to it – appears to be growing

Atlanta Fed President Raphael Bostic, who expects a slightly gentler path of rate increases than most of his colleagues, said earlier on Monday he is open to bigger-than-usual rate hikes “if that’s what the data suggests is appropriate.”

Speaking on Friday, Fed Governor Chris Waller said he would favor a series of half-percentage point rate increases to have a quicker impact on inflation.

The U.S. unemployment rate currently is at 3.8% and per-person job vacancies are at a record high, a combination that’s pushing up wages faster than is sustainable.

“There’s excess demand,” Powell said, adding that “in principle” less accommodative monetary policy could reduce pressure in the labor market and help stabilize inflation without pushing up unemployment, generating a “soft landing” rather than a recession.

INFLATION RISKS

Inflation by the Fed’s preferred gauge is three times the central bank’s 2% goal, pushed upward by snarled supply chains that have taken longer to fix than most had expected and that could get worse as China responds to new COVID-19 surges with fresh lockdowns.

Adding to the pressure on prices, Russia’s war in Ukraine is pushing up the cost of oil, threatening to move inflation even higher. The United States, now the world’s biggest oil producer, is better able to withstand an oil shock now than in the 1970s, Powell noted.

Although the Fed in normal times would not likely tighten monetary policy to address what in the end may be a temporary spike in commodity prices, Powell said, “the risk is rising that an extended period of high inflation could push longer-term expectations uncomfortably higher.”

Last year, the Fed repeatedly forecast that supply chain pressures would ease and then was repeatedly disappointed.

“As we set policy, we will be looking to actual progress on these issues and not assuming significant near-term supply-side relief,” Powell said on Monday. Policymakers began this year expecting inflation would peak this quarter and cool in the second half of the year.

“That story has already fallen apart,” Powell said. “To the extent it continues to fall apart, my colleagues and I may well reach the conclusion we’ll need to move more quickly and, if so, we’ll do so.”

Fed policymakers hope to rein in inflation without stomping on growth or sending unemployment back up, and their forecasts released last week suggest they see a path for that, with the median view for inflation falling to 2.3% by 2024 but unemployment still at 3.6%.

Powell said he expects inflation to fall to “near 2%” over the next three years, and that while a “soft landing” may not be straightforward, there is plenty of historical precedent.

“The economy is very strong and is well-positioned to handle tighter monetary policy,” he said


Biden’s Dishonest Attempt To Pin Inflation on Putin

The White House's latest attempt to scapegoat rising prices ignores everything that happened before the past three weeks.

By Eric BoehmReason

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(Tom Williams/CQ Roll Call/Newscom)

Ten months ago, Jeremy Siegel issued a dire warning about the trajectory of prices.

“The money supply since the beginning of the pandemic, so a little over a year, has gone up almost 30 percent. Now, that money is not going to disappear. That money is going to find its way into spending and into higher prices,” Siegel, a professor of finance at the University of Pennsylvania’s Wharton School, told CNBC during an interview on May 14. “Over the next two, three years we could easily have 20 percent inflation with this increase in the money supply.”

He was hardly the only one sounding the alarm. A few months earlier, before Congress approved President Joe Biden’s $1.9 trillion American Rescue Plan, several prominent economists had warned that the stimulus bill—the third major one passed since the outbreak of COVID-19 just a year earlier—was too big and threatened to overheat the economy.

Among the critics were people like Lawrence Summers, who served as Treasury Secretary during the Obama administration. “There is a chance that macroeconomic stimulus on a scale closer to World War II levels than normal recession levels will set off inflationary pressures of a kind we have not seen in a generation,” Summers warned in a Washington Post op-ed in February 2021. “Administration officials’ dismissal of even the possibility of inflation, and the difficulties in mobilizing congressional support for tax increases or spending cuts, there is the risk of inflation expectations rising sharply.”

“I think we do not need to spend $1.9 trillion…and we should have a smaller program,” Olivier Blanchard, the former chairman of the International Monetary Fund, wrote on Twitter in response to Summers’ op-ed. Biden’s plan to shovel another $1.9 trillion into the economy was coming on top of unprecedented fiscal stimulus and high personal savings rates (due to the pandemic). Americans were already poised to spend a lot more money chasing the same amount of goods as the pandemic waned, and the increase in demand would require impossible levels of output to match. “Strong inflation” would be the natural result, he warned.

“This would not be overheating,” he wrote. “It would be starting a fire.”

By July, a few months after the American Rescue Plan passed, economists surveyed by The Wall Street Journal said Americans should be bracing for levels of inflation not seen in more than 20 years. That dire prediction was an underestimation.

This history matters because the White House’s latest attempt to explain away inflation rates that have hit their highest levels in 40 years is to blame Russian President Vladimir Putin, and the war he has started in Ukraine, for the whole mess. After the Labor Department released new data last week showing that inflation had jumped to 7.9 percent over the past year, the White House responded with a statement claiming that “today’s inflation report is a reminder that Americans’ budgets are being stretched by price increases and families are starting to feel the impacts of Putin’s price hike.”

The argument is that Russia’s invasion of Ukraine—and the global response to it, which has included cutting off purchases of Russian oil and gas—are pushing prices higher throughout the economy. “Make no mistake, the current spike in gas prices is largely the fault of Vladimir Putin and has nothing to do with the American Rescue Plan,” Biden said Friday.

It’s true that gas prices have spiked dramatically in the weeks since Russian troops invaded Ukraine. But Biden’s attempt to pin a year of steadily rising prices on the events of the past few weeks makes little sense.

For one thing, last week’s report from the Labor Department showing that inflation had hit 7.9 percent looked at prices from February 2021 through February 2022. Putin’s invasion of Ukraine began on February 24, so the White House is asking you to ignore 361 days of data in order to focus on what happened during the last four.

It’s certainly possible that the war in Ukraine—and the disruptions it has caused to global fuel and food supply chains—will put more upward pressure on prices. But that information won’t be visible in the government’s official data until the next consumer price index report is released in early April.

What about Biden’s more narrow claim: that rising gas prices are largely to blame for inflation. It’s true that higher gas prices will push other prices higher as a result—because higher fuel prices make it more expensive to ship anything from place to place. And the White House is correct that energy prices are rising faster than prices overall. Overall energy prices are up 25.6 percent since last year, and gasoline prices are up 38 percent, according to the Labor Department’s most recent data (which, again, captures prices through the end of February).

But if that’s all Putin’s fault, how do you explain the fact that energy prices—and gasoline prices, specifically—had been rising faster than just about anything else for much of the past year? In November, the Labor Department reported that energy prices were up 33 percent and gasoline prices up 58 percent over the previous year. In August, those numbers were 25 percent and 42 percent, respectively. What’s happening here seems to run a lot deeper than the events of the past few weeks.

“Yes, Putin’s invasion is making a huge difference. But demand for gasoline surged much earlier when consumers, with money in the bank and uninterested in flying because of COVID-19 concerns, put family cars on the road in the midst of the great COVID shutdown, making the number of miles traveled in spring 2021 rise to new heights,” wrote Bruce Yandle, former executive director of the Federal Trade Commission and economist at the Mercatus Center, last week in Reason.

Finally, this brings us back around to the economists who were warning last year that Biden’s stimulus bill would be a recipe for high inflation. It’s unlikely that Siegel, Summers, and the rest had a crystal ball that could predict Russia’s invasion of Ukraine.

What they were predicting—and, indeed, what we are now seeing—was persistently rising prices due to an excessive amount of money being dumped into the economy. Any attempt by the Biden administration to explain inflation that doesn’t include a hard look at its own policies is simply dishonest.


Under Joe Biden, America is Running Out of Gas

By Peter RoffAmerican Liberty

The Roff Draft: Under Joe Biden, America is Running Out of Gas

President Joe Biden has a problem with numbers. He can’t make them add up and it’s not clear that he knows what they mean. He’s so devoted to his progressive narrative that he becomes confused when the data doesn’t support the conclusions he and his economic team want to reach.

This leads him to say all kinds of wacky things about taxes and prices and spending and inflation that are undermining the American public’s confidence in the U.S. economy. It is possible, as has been proved more than once over the last 25 years, to talk us into a recession. And, with the Atlanta Fed projecting zero growth for the first quarter of 2022, the president and his team may be doing just that.

Consider Biden’s remarks in his most recent State of the Union Address. As a way of pumping up the enthusiasm over his plan to fight inflation and rebuild the American economy following the lockdowns, he criticized the pro-growth tax cuts enacted under his predecessor. “Unlike the $2 trillion tax cut passed in the previous administration that benefited the top 1 percent of Americans,” he said, his American Rescue Plan “helped working people – and left no one behind.”

That, to put it mildly, is an exaggeration of the worst order. The Trump tax cuts benefited the top 1 percent of income earners because they benefited everyone who pays federal income taxes. The only people they didn’t help directly were the roughly 50 percent of Americans who don’t make enough money to pay income tax to Uncle Sam.

Some people, including Mr. Biden, think that’s unfair. Then again these are the same people who confuse tax avoidance – which is the lawful attempt to minimize one’s tax payment – with tax evasion. The latter, which is the practice of not paying taxes legitimately owed, is illegal. If the president and his congressional allies like Senate Finance Committee Chairman Ron Wyden, D-Ore., had their way the former might become illegal any time now too. But that’s a matter for another day.

The Tax Cuts and Jobs Act Biden derides as only benefiting the wealthy increased the incentive for those “of means” and those who wished to someday be “of means” to make more frequent and more valuable capital investments expecting, as was shown to be the case before the pandemic-inspired lockdowns jiggered the system, that greater financial risk produced greater financial rewards.

This created an environment in which almost every American was a winner. The economy grew, jobs were created, and unemployment sank like a stone among the demographics that garner the most media attention like single women, young African-Americans and Latinos. Productivity rose and with it, as most analysts reported, so did wages.

Biden doesn’t get that. He still believes that for the rich or powerful to do well, the poor and struggle must suffer. It’s an outmoded way of thinking that most people thought died out with the Soviet Union but, as Putin’s invasion of Ukraine reminds us, some threats just never go away.

He’s got it all cocked up on energy too. Asked Thursday about rising prices at the pump, Biden blamed the war in Ukraine and the sanctions that have been imposed on Russia for the spike. That has something to do with it to be sure. The bigger cause is the way the president used what former House Majority Leader and Ph.D. economist Dick Armey calls “the invisible foot of government” to kick America’s energy independence to the curb.

The price of gasoline is rising because America’s energy sector cannot increase production to levels sufficient to meet the demand for gasoline at less than $3 per gallon. To put it another way, Biden broke the spigot by suspending oil leases, restricting exploration, reinstating economically counterproductive regulations, killing the Keystone XL pipeline and doing whatever else he and his brain trust could to conceive to force consumers to speed up their adoption of wind and solar power.

How’s that worked out? Well, since he’s come into office the average American family have seen their annual energy costs increase, by some estimates, by more than $1,000, gas prices have reached the highest level ever recorded – above $4 per gallon on average in 38 states – and congressional Democrats are once again talking about instituting a special tax on “excess” energy company profits that can be paid out to low-income individuals and families to help them deal with higher prices. To call that madness is an insult to the insane.

When asked what he plans to do, the best answer Biden could come up with was to suggest there wasn’t much he could do about it right now. Then he talked about oil companies and production increases and investments as though he understood it all. Here’s what he told the members of the Democratic National Committee Thursday night:

“We are increasing oil production with a [sic] record productivity. By the end of the year, we will have produced more oil than any time in the last number of years. … The CEOs of major oil companies have said they’ll increase investment and production… My message is: It’s time — in this time of war, it’s not a time of profit. It’s time for reinvesting in America. And they hear it. You know, there’s a — there’s an impediment to production in the United States, and it’s called ‘the bankers on Wall Street.’  And this crisis is another indication of why we need to get off dependency on fossil fuels.”

That may be confusing to follow so, to translate, in the president’s view: 1) Energy companies are bad because they profit when prices rise because the politicians have created a global crisis of the 1st order; 2) We have plenty of oil but business isn’t producing it so they can make more money; 3) The big bad bankers on Wall Street are behind it all; and, 4) We need to go green.

As they say, there’s nothing like letting the facts get in the way of a good narrative.

Biden forgot to mention a lot, including how the national average price of gas was already up by $1.14 before Russia invaded Ukraine because of the anti-fossil energy initiatives his administration had taken or announced plans to take — like the Biden SEC’s effort to force public traded companies to disclose the potential economic impact to their business from global warming and greenhouse gas production.

From the largest Cabinet Department to the smallest independent agency, the Biden administration is waging a regulatory war on fossil fuels that touches every sector of the economy. And all the president can say is “What? Who? Me?” A convenient memory lapse assisted by a fundamental misunderstanding of economics is killing off the American energy renaissance.


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