Bidenflation Strikes Again

Biden and Congress in tight competition to fail harder

Inflation reported by the government Wednesday was worse than what Wall Street experts predicted. Setting aside the expectations game, the numbers were just bad in general.

The Labor Department reported that the Consumer Price Index (CPI) rose 3.5% compared to a year ago. More worrisome, it rose 0.4% for the month of March, implying a current annual inflation rate of 4.8%--well above the 2% norm before the pandemic sparked a central planning and government spending bonanza unseen since World War II.

The statistics reinforce what the public already senses: that Bidenomics is defined primarily by Bidenflation, which will have taken 30% of Americans’ savings and purchasing power by the end of his sad term. Even a long-overdue firing of his economic team, including Fed Chairman Jerome Powell, probably would be too little too late to change the dynamic.

Furthermore, CPI is flawed and understates the actual level of inflation in the economy. This reality is lost on liberal financial outlets and reporters like the Wall Street Journal’s George Ip, who published an article last week titled, “What’s Wrong With the Economy? It’s You, Not the Data.” Ip is uninterested in reporting the real inflation harming the public, writing instead: “I’m not stating an opinion. This isn’t something on which reasonable people can disagree.” (Does the WSJ really not know why it is being surpassed by Bloomberg?)

Notwithstanding Ip’s certainty, voters grasp reality and are not pleased. According to a RealClearPolitics average of polls, only 40% of voters approve of President Joe Biden’s handling of the economy. Asked specifically about inflation, the number drops to just 36% approving.

Inflation is driven by government overspending and harm to the supply side of the economy, which have continued years after the pandemic crisis and, by Biden’s own forecasts, will continue indefinitely. Annual deficits of nearly $2 trillion are now normal. The budget for the current fiscal year is $7 trillion. It was “only” $4 trillion when Biden’s predecessor, Donald Trump, took office.

The latest numbers also undermine the credibility of the Federal Reserve, which has been waxing poetic about cutting interest rates and slowing the dollar-absorbing reduction of its bloated balance sheet—both actions intended to goose business activity and the stock market to help Biden get reelected. Unless the Fed halts all talk of loosening and instead signals higher rates, it will find itself in a position similar to the late 1970s where tough talk about inflation was ignored by the market. The recent melt-up in gold and other commodities like copper and oil—misattributed to increased economic activity—ought to be an unmistakable sign of inflation and monetary policy that is too loose.

Biden could at least nod to the unpleasant reality that voters see by firing his clueless Treasury Secretary, Janet “From Another Planet” Yellen, who just wrapped up some spring break diplotourism in China. But that won’t happen because success in her position as most Americans would define it has never been Biden’s criteria for his Treasury boss. As a White House spokesman put it early in the administration when asked about stock market turbulence: “Well, I’m also happy to repeat that we have the first female Treasury secretary and a team that’s surrounding her and often questions about markets.” As long as Yellen remains a female, the job is hers to keep.

Janet Yellen bows to China’s vice premier. Janet Yellen is a woman.

The mold of personnel management was actually cast in the first summer of the Biden administration when no one was dismissed for the debacle in Afghanistan. Once one starts holding some people to account for job performance, one never knows where it will end. The woke kiddos in the White House who actually run the administration in lieu of a competent president don’t want to start an avalanche that may reach them.

Where does all of this leave Biden? As I wrote two years ago, “Biden’s Worst Days are Yet to Come.” The assessment is still true. America’s economic, fiscal, and military security will continue to erode through summer and fall as voting begins in October. The Democrats and media are pinning their final hope to activist enthusiasm for late-term abortion, but Trump effectively began neutralizing that issue this week, saying it should be left to the states. The subsequent highly impressive meltdown by Democrat officials and the media—it was as if Judy Garland died all over again—is proof that Trump’s approach is likely effective. Today’s inflation report only reinforces the probability that Democrats are slouching toward disaster.  

Just in: Congress Also Useless

Surveillance.

As the White House flails, what are our fine statesmen and patriots down Pennsylvania Avenue up to in Congress? Have they passed the bill to ban TikTok, a Chinese-made app that tracks users’ movements and habits and manipulates the information they are fed to the benefit of TikTok’s masters? Nope.

How about something easy if minor that almost everyone agrees on, like eliminating standard time to stay permanently on daylight savings time? Nope.

Instead, the House has managed to put the spotlight back on itself with consideration of one of the deep state’s top wish list items: extension of so-called Section 702 warrantless surveillance of Americans, which expires next week. A vote in the House to extend the authority failed 193-228 after Trump condemned the move, but don’t underestimate the deep state’s determination to keep all of the power it has. Allowing the authority to expire hardly constitutes the reform necessary to adapt to a changed domestic security reality some twenty-two-and-a-half years after 9/11, but it would be a nice start.

The House is also toying with taking up aid to Ukraine, the latest collapsing line of defense of the globalist project. While some aid is warranted to prevent Biden from blaming Republicans for the emerging failure in Ukraine, some Republican ideas, like appropriating the full $60 billion requested by Biden and paying for it by stealing frozen Russian funds (reminder: the U.S. has not declared war against Russia), would quicken the global decay of the dollar and make a negotiated peace harder for the next administration to achieve.

At this point, Congress is basically the American equivalent of a hung parliament in which nothing much can get done. The majorities are too bare in each in house and new direction from voters is wanting. Legislators should pass a short-term budget to fund the government from October through the first few months of the new administration and call an end to the 118^th Congress.

Parting Shot

Speaking earlier of the Wall Street Journal, it is hard for any opinion page to be as predictable, dogmatic, and generally lame as the Los Angeles Times, but the keyboard warriors in New York are giving their left coast counterparts a run for their money. Last month, one of several pro-Ukraine war articles run on any given day called for increasing U.S. and Saudi oil output and other moves to crater the price of oil, citing favorably the collapse in the price of oil in the late 1980s.

The article, written by a Ukrainian official who is an underling of Captain Undershirt and also apparently co-chair of “an international working group on sanctions with Michael McFaul, a former U.S. ambassador to Russia,” is wrong on the impetus for the late-80s decline in oil prices. The article is also plainly stupid. America and Saudi Arabia are the world’s top-two oil producers. A collapse in the price of oil would primarily hurt…. America and Saudi Arabia. It would actually hurt the USA more since Saudi’s cost of production is lower—Saudi could turn a profit at a price at which the USA could not—and create long-term pain by scaring investors away from U.S. energy production.

How could the “Free People, Free Markets” paper publish something quite so dumb? The answer seems be that the Journal, like so many on left and right, has become deranged and hysterical on the topic of Russia.

Simon and Whiton

In case you missed it, Mark and I discussed how not to get SMICE’d, the state of fortune cookies, and a China-Philippines war.