October 4, 2022
Inflation up 13% since President Biden took office: Economist

Since President Biden first entered the White House, inflation has soared into double digits — and experts told The Post that his policies have increased the burden on American families.

Headline inflation has risen by more than 13% since Biden’s inauguration in January 2021, according to calculations by economist Peter C. Earle of the American Institute for Economic Research. Core inflation, which excludes volatile food and energy prices, rose by about 10% over the same period.

Meanwhile, wages have risen only 8% over the same period – resulting in an effective pay cut for ordinary Americans who are struggling to pay for daily necessities like food, gas and rent.

“US consumers are lagging far behind. Inflation is a devastating blow to their standard of living,” Earle told The Post.

Prices rose 8.3% in August compared to the same month a year earlier, while core inflation rose 6.3% year-on-year, after federal data Tuesday renewed concerns about persistent inflation. Both numbers came in hotter than economists expected.

Biden downplayed the worse-than-expected figures, saying the recovery in gas prices was a sign that inflation had begun to soften.

President Biden
Critics argue that President Biden’s policies have contributed to the problem.
AFP via Getty Images

“Today’s figures show greater progress in the US economy in bringing down global inflation,” Biden said in a statement. “Overall, prices in our country have remained essentially flat over the past two months: this is welcome news for American households, and there’s more work to do.”

Still, many of the core items cost much more than they were at the time Biden took office with the promise of restoring prosperity to the middle class.

Through August, gasoline costs were $1.77 per gallon higher than in January 2021. A dozen large eggs were $1.65 more expensive, while ground chuck was more expensive at 81 cents per pound.

Bananas
Food prices have reached their highest level in decades.
Xinhua news agency via Getty Images

Biden’s policies have contributed to a “triple threat” that has slammed the household budget, according to Tomas Philipson, an economist at the University of Chicago and acting chairman of the White House Council of Economic Advisors during the Trump administration.

“They’ve increased demand dramatically with fiscal policies, which are basically pushing up demand. Increasing demand drives up prices,” Phillipson said. “And then they’ve restricted supply, especially in energy, but also in other sectors, by their regulatory state, which is on a larger scale than Trump’s. It’s even heavier than Obama’s.”

Petrol pump
Gas prices have improved, but food and shelter costs remain high.
Getty Images

“Also, the Fed basically monetized it by printing money. When you have more money to chase more goods, that also drives up prices,” he said.

Phillipsson said headline inflation has risen 14% in the past two years since August.

Philipson noted the previous wage increase as a sign that American workers have had a “decreased standard of living” over the past two years.

“For the past two years, your income hasn’t kept up with all the price increases, making you poor in the sense that you can’t buy as much,” he said. “Once they fill up their tank, once they put their dinner on the table, they have little left for other things. That’s the real problem.”

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