Biden Calls It ‘Bizarre’ To Say His Spending Caused Inflation. His Economists Say Otherwise.
White House economists have conceded that the spending by the Biden administration may have led to inflation, despite the president rejecting the notion that his trillion-dollar plans caused price hikes as “bizarre.”
As per the annual “Economic Report of the President,” Biden’s past stimulus plans “could have contributed to high inflation” over the last two years, the administration’s economists said. Rather than spending the pandemic aid money instantly, the Americans saved some of their funds for larger purchases later. This has increased the demand and prices, thus inflating the economy.
“If the drawdown of excess savings, together with current income, boosted aggregate demand, it could have contributed to high inflation in 2021 and 2022,” the report stated. The primary driver of Biden’s spending was the $1.9 trillion American Rescue Plan passed in March 2021. Other spending bills include the $550 billion Bipartisan Infrastructure Law and the $443 billion Inflation Reduction Act.
The recent report indicates that the White House is starting to acknowledge its role in the high inflation rates observed under the Biden administration, after rejecting the role for almost two years. In June, when asked about how the American Rescue Plan contributed to soaring prices, Biden labeled it as bizarre.
“You could argue whether it had a marginal, minor impact on inflation. I don’t think it did,” Biden said at the time. “And most economists do not think it did. But the idea that it caused inflation is bizarre.”
Biden insisted in July 2021 that no serious economists anticipate inflation, just months after the Congress passed the American Rescue Plan.
“There’s nobody suggesting there’s unchecked inflation on the way—no serious economist,” Biden said at the time.
The link between Biden’s spending and inflation is not a surprise, even to Democrats. Last year, Biden ally and then-house majority whip, Jim Clyburn (D., S.C.), admitted that they knew inflation was imminent following Biden’s signature on the spending bills.
“Let me make it very clear. All of us are concerned about these rising costs, and all of us knew this would be the case when we put in place this recovery program,” Clyburn said last April.
Furthermore, the Federal Reserve Bank of San Francisco has also attributed the high inflation rates to Biden’s American Rescue Plan. In June 2022, inflation hit a peak of nine percent annual rate, the highest level in 40 years.
" Conservative News Daily does not always share or support the views and opinions expressed here; they are just those of the writer."
