Inflation this high is very bad for Americans, and especially the Americans who have to pinch pennies to feed their families, write the rent check and fill their gas tanks. And while it’s axiomatic that the economy a president oversees is the economy for which he’s held accountable, it’s also exceedingly hard for politicians to control. It’s the Federal Reserve, which sets interest rates, that wields the most powerful weapon by far, one it has been using in recent weeks and intends to use again. It must do so, taking care not to push an otherwise energetic economy into recession in the process.
Moreover, if President Joe Biden — on whose watch pandemic-era cash payments from Congress to families, arguably the single biggest policy measure fueling inflation, have ceased — gets blame for four-decade-high price increases of 9.1%, he also gets credit for a booming job market. As the nation under Biden has emerged from the profound insecurity and even paralysis during the worst of the COVID pandemic, employers have added more than 9 million jobs, with private sector firms now regaining all the jobs they lost during the slow-motion public health catastrophe. That’s not nothing.
Nor is it meaningless that workers are seeing strong wage gains that in ordinary times would be cause for celebration. Today, it mainly fuels fears that prices will keep soaring, eating away at whatever increases are reflected in fatter paychecks.
Economically speaking, Biden may have minimal power to curb inflation. But as a political matter, he’s the one who two long months ago put forward a plan declaring it his top priority to do so and detailing concrete steps — many of which hinge on steps being taken by a Democrat-controlled Congress — designed to lower costs for families. He’d clearly be crowing and claiming success if prices were stabilizing.
Quite obviously, the Biden plan isn’t working yet, especially when it comes to curbing persistent supply chain backlogs. If inflationary pressures continue to intensify, Biden cannot simply blame Vladimir Putin. He and his party will pay the price of rising prices.