Inflation Narrative Bingo

What is the story on inflation?

For many, the inflationary storm that has taken place in the U.S. over the past three years was completely unexpected. But it isn’t true to say that no one predicted how bad inflation would get — or that it would persist well into 2024 with no signs of stopping.

“Fact Check: Did ‘Nobody’ Predict Inflation as Psaki Claims?” asked Katie Pavlich for Townhall on May 10, 2022.

“In February 2021, Obama economic advisor Larry Summers warned about coming inflation as a result of President Biden’s $1.9 trillion American Rescue Act,” Pavlich reminded readers. “Biden officials argued the package, which no Republicans voted for, would stimulate the economy and that it was necessary to rescue those impacted negatively by government decisions during the pandemic.”

Summers wasn’t the only one warning about inflation in 2021 and 2022.

“Liberal Spending Policies Will Increase Inflation and Fuel Shortages,” predicted Frank Lasee for Real Clear Energy on November 3, 2021.

“Workers have been earning higher wages in the last few years, but inflation has consumed those gains,” he advised. “Many Americans feel like they are on a treadmill and cannot progress toward their goals, including saving for retirement or buying a new house. If Congressional Democrats get their way and pass their multitrillion-dollar spending bill, we’re going to see the inflation beast become even more ravenous.”

“Speaker of the House Pelosi and Senate Majority Leader Schumer’s colossal and excessive spending and regulation bill will make it more difficult for American workers to thrive,” predicted Lasee presciently. “Provision after provision in the bill would either directly or indirectly increase inflation by increasing the cost of energy use, while also raising taxes.”

“Inflation, wage data, challenge Fed ‘transitory’ narrative,” reported Howard Schneider for Reuters on November 1, 2021.

“Price and wage increases running at multi-decade highs may challenge Federal Reserve officials this week as they try to maintain a balance between ensuring inflation remains contained and giving the economy as much time as possible to restore the jobs lost since the pandemic.”

Noting that the “Transitory Thesis Has Not Aged Well,” Schnieder wrote: “It may be a confusing moment when it comes to inflation. Blamed at first on what were expected to be temporary supply disruptions and a bulge of consumer spending on goods that were becoming hard to find in some cases, the pace of price hikes has remained higher for longer than expected.”

Even into 2023, economists were issuing dire warnings.

“Bidenomics Is Unsustainable,” pronounced Stephen Miran for the Wall Street Journal on September 19, 2023. “Subsidies for unions will drive labor costs up, making the U.S. uncompetitive.”

“The administration’s fiscal glut includes many taxpayer-funded incentives for expanding industrial capacity,” he added warningly. “The Inflation Reduction Act’s climate and energy subsidies are expected to surpass $1 trillion. While the inflationary effect is obvious, less appreciated is that these massive fiscal programs are designed to stimulate unionization.”

At times, the Democratic Party and progressive media editors have seemed to care more about avoiding political fallout than solving the persistent problem of inflation.

“Biden targets GOP on inflation as prices skyrocket,” wrote Hans Nichols for Axios on May 8, 2022. “For a president who once insisted inflation was ‘transitory,’ Biden is now talking about rising prices at nearly every opportunity.”

“Biden is now trying to convince the American public he has a plan to lower costs, even as some of his top economic advisers say the Federal Reserve has the most powerful tools to drive down inflation,” Nichols added.

“Can blaming corporate greed save Democrats on inflation?” wondered Christian Paz for Vox on June 11, 2022. “Some progressive groups are urging Biden and Democrats to more aggressively cast corporations and billionaires as enemies in the fight against inflation.”

“Americans don’t need the Labor Department to tell them that prices remain high,” Paz admitted. “Still, Friday’s consumer price index report for May revealed that inflation reached a 40-year high, an 8.6 percent increase last month compared to a year ago. Energy and food supply shocks from the Russia-Ukraine war, pandemic-related employment and production shortages, and strong consumer demand, especially in airline travel, all contributed to higher prices.”

Efforts to brand inflation “Putin’s Price Hike” were ill-fated.

“With the biggest single driver of inflation being Putin’s war against Ukraine, @POTUS has taken action to blunt the impact of Putin’s Price Hike for families,” the White House tweeted on June 20, 2022, to which readers added the following context using a New York Times article as reference: “Most of the recent USD inflation happened prior to the Russian invasion of Ukraine.”

“Biden’s American Rescue Plan worsened inflation: The Question is How Much,” qualified Andrew Prokop for Vox on May 12, 2022. “Was it a minor contributor or a major factor in the US’s inflation woes?”

“When will the Inflation Reduction Act start reducing inflation? White House stumped for an answer,” quipped Aaron Kliegman for Just the News on October 17, 2022. “From Bernie Sanders to Ivy League studies, prominent voices have expressed doubt about Biden’s signature legislation bringing down costs.”

At that time, Biden Administration officials were still predicting relief would soon be coming for struggling Americans.

“In regards to the Inflation Reduction Act, early next year they will see some of the pieces of that when you think about energy costs, when you think about the Medicare kind of benefits from that,” White House spokesperson Karine Jean-Pierre told reporters in October 2022. “So, we’ll see some movement on that early next year.”

“So, the — many parts of the bill will start to take effect next year,” White House economic advisor Cecilia Rouse promised along the same lines. “For example, there are tax credits for energy to help people weatherize their homes and also bring down other forms of energy costs. So, we are focused on helping to make that transition to clean energy in a way that brings down energy costs for families. So, this is, this is tough. There’s no question about it.”

Of course, none of those rosy predictions have come to pass and struggling Americans are still struggling even as millions more are forced into their ranks every day by rising prices.

(contributing writer, Brooke Bell)