A worse-than-expected inflation report is complicating the Biden administration’s message that the inflation rate is temporary and driven by supply-chain backlogs resulting from the pandemic.
A report from the Bureau of Labor Statistics (BLS) showed prices rose 6.2 percent in October compared with a year ago, which is the largest annual increase in 30 years. BLS attributed the spike to soaring gasoline and energy prices, among other factors. Gasoline prices are up more than 49 percent from a year earlier. Prices for automobiles, shelter, food, medical care, household furnishings and recreation all increased in October.
The data underscores how inflation is becoming a highly political issue during the pandemic and is posing a critical threat to President Biden’s economic agenda.
At a speech in Baltimore to promote his newly passed infrastructure bill yesterday, Biden said he knows Americans are feeling financial pain but that the infrastructure bill and other elements of his economic agenda are the best path to relief for American families.
“We still face challenges, and we have to tackle them,” Biden said. “We have to tackle them head on. Many people remain unsettled about the economy, and we know why. They see higher prices. They go to the store or go online and can’t find what they want.”
Sen. Joe Manchin (D-WV), whose vote is crucial to enacting Biden’s Build Back Better Act, has been very concerned about the price tag for the legislation and Democrats’ overall spending driving inflation.
“By all accounts, the threat posted by record inflation to the American people is not ‘transitory’ and is instead getting worse,” Manchin lamented again this week. “From the grocery store to the gas pump, Americans know the inflation tax is real, and D.C. can no longer ignore the economic pain Americans feel every day.”
Congressional Republicans have also seized on inflation as their primary reason for pushing back on Biden’s agenda.
“Inflation under President Biden is the worst in 40 years, and real wages for families are sinking faster than during the financial crisis,” said Rep. Kevin Brady (R-TX) ranking member of the House Ways and Means Committee. “Thanks to Bidenflation, this is a pay cut families can’t afford. No wonder Americans now rank inflation alongside COVID as their biggest concerns.”
This article was provided to OSAP by ASAE's Power of A and Inroads.