UPDATED 7:40 PM PT – Monday, July 19, 2021
Joe Biden attempted to downplay inflation concerns during a speech on his administration’s handling of the economy. Speaking at the White House on Monday, Biden touted the highest economic growth rate in 40 years as the U.S. started to reopen from coronavirus lockdowns.
However, there was a downside to that record growth as more consumers have flocked to the market, increased demand and sparked a rise in inflation. For the past four months, inflation has exceeded already high expectations.
Biden also called on Congress to pass his massive infrastructure proposals, which would amount to more than $4 trillion in spending. Those two bills have been faced with roadblocks in the Senate as the White House has continued negotiations with GOP lawmakers on a smaller $973 billion bill.
Prices on everything from gas to groceries are skyrocketing. Inflation is hitting hard-working middle-class families the hardest.
A key driver of these price increases and increased costs of living is crystal clear → massive increases in government spending by the Democrats.
— Kevin McCarthy (@GOPLeader) July 19, 2021
The Democrats’ larger $3.5 trillion dollar package would require “yes” votes from all 50 Senate Democrats and appeal to both the moderate and radical wings of the party. Experts say those massive spending bills would only accelerate the already alarming inflation rates.
“What we’ve already got in the pipeline is gonna cause inflation,” Former IMF Deputy Director Desmond Lachman explained. “Now, if you add the infrastructure plan and families plan and it’s not going to be properly financed with real taxes that restrain spending, then you’re just going to be adding to the inflationary pressures.”
The stock market falling is not surprising. The Biden Surcharge and inflation are catching up—this is Biden’s America, and we’ve been sounding the alarm.
— Sen. Marsha Blackburn (@MarshaBlackburn) July 19, 2021
Despite the concerns, Biden insisted the surge in inflation was expected and added he plans to do whatever it takes to keep it in check for the long term.
“My administration understands that if we were to ever experience unchecked inflation over the long term, that would pose a real challenge to our economy,” he claimed. “So, while we’re confident that isn’t what we’re seeing today, we’re going to remain vigilant about any response that is needed.”
For fiscal year 2021, consumer prices rose by 5.4 percent and marks the highest increase in a year since 2008.