A new report surfaced over the weekend that highlighted real concern from top U.S. economists about the impact of President Joe Biden’s massive government spending.
The Wall Street Journal reported that “Americans should brace themselves for several years of higher inflation than they’ve seen in decades, according to economists who expect the robust post-pandemic economic recovery to fuel brisk price increases for a while.”
The liberal newspaper also reported: “The respondents on average now expect a widely followed measure of inflation, which excludes volatile food and energy components, to be up 3.2% in the fourth quarter of 2021 from a year before. They forecast the annual rise to recede to slightly less than 2.3% a year in 2022 and 2023. That would mean an average annual increase of 2.58% from 2021 through 2023, putting inflation at levels last seen in 1993.”
This report challenged that inflation measures had jumped to their highest levels since the early 1990s. The newspaper noted that the present administration may not raise rates until after the midterms so that Biden can avoid more fallout at the polls from his administration’s policies.
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Joel Naroff, a chief economist at Naroff Economics LLC, shared with The Journal: “We’re in a transitional phase right now. We are transitioning to a higher period of inflation and interest rates than we’ve had over the last 20 years.”
Diane Swonk, a chief economist at Grant Thornton, added: “Inflation is expected to surge longer and longer—longer than the Fed previously thought. The Fed is now likely to raise rates in the first half of 2023, although some Fed presidents will be nipping at the bit to move sooner.”
These warnings were also back up by Kevin Swift, a chief economist at the American Chemistry Council. He said: “The danger is that monetary authorities are behind the curve. I’m not saying hyperinflation is around the corner, just that a lot of things have come together in the last year, and the overall trend of costs across the board is growing faster than in the last five or 10 years.”
Swift also focused on the chaos that inflation is having on the construction industry. “It’s disruptive—you can’t be sure of what your costs are, whether you can get supplies or what the costs will be six months from now. I’d hate to be in the construction business trying to bid on a job when you don’t know what the cost of steel will be 18 months from now.”
President Biden’s administration is certainly aware that inflation is a serious issue. For the Fourth of July weekend, the administration bragged about saving Americans $0.16 on the cost of the total amount of food that they’ll consume on the Fourth of July. As crazy as it seems, the administration claimed that the $0.16 in savings was proof that “the Biden economic plan is working.”
The Daily Wire wrote with their tongue in their cheek about this laughable announcement. “Inflation is skyrocketing, the economy has a record-high quit rate, millions of Americans could soon face evictions, and Biden has suffered numerous disastrous job report numbers. Gas prices are higher now than they were at any point under former President Donald Trump and are the highest they’ve been since 2014.”
Top Democrat economists have warned that the economy is at serious risk of overheating and of inflation becoming much worse. One agency reported that 85% of Americans are now worried about inflation.
Top investors are challenging that the Biden administration “just continues to pour more gasoline on [the housing market] fire,” which they said is “making inequality worse” because “you end up subsidizing the rich at the expense of the poor.”