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IPFS News Link • Economy - Economics USA

The Lasting Damage Of Bidenomics

•, by K.S. Bruce

The truth is that the wild inflation, high interest rates, bank failures, and other economic harms of the last three years were all entirely avoidable and all entirely caused by President Biden and the Democrats' arrogant and unwise policies.

This is not "Monday morning quarterbacking." Some of us were saying this well before the fact. My May 7, 2021 column ("Joe Biden, Economy Killer") accurately forecast the inflation, rising interest rates, and rising government debt service long before the Biden administration even acknowledged the risks were real.

The U.S. economy did not need another giant stimulus plan when Biden and the Democrats took control in 2021. The U.S. gross domestic product, knocked down by the COVID shutdown in the first half of 2020, had jumped up by a record 33% in the third quarter of 2020 and by another 4% in the fourth quarter, all before Biden took office. The S&P stock market had risen 16.3% in 2020. Employers were waiting for workers to come back to work, and another stimulus package had been passed with bipartisan support in the last quarter of 2020. Happily, the inflation rate was only 1.4% as 2020 ended, with a one-year Treasury rate of just 0.10% and a 10-year Treasury rate of just 0.95%

The outlook for 2021 was also favorable. As the Wall Street Journal reported on Jan. 28, 2021, "The International Monetary Fund expects the U.S. economy to grow 5.1% this year, while economists surveyed by the Wall Street Journal projected 4.3% growth … U.S. employers are poised to add more than five million jobs this year, according to economists surveyed by the Journal. That would make 2021 the best year for employment gains in records dating back to 1939."

As Biden entered the White House in January 2021, a wiser new president would have allowed this recovery to continue without meddling. But what political fun is that? How can you be the "new FDR" unless you present matters as worse than they are, so that you can create giant new programs and be the savior? How can you transfer trillions of taxpayer money to build a Democratic Party political base?