Denver, Colorado 2022-05-27 10:24:39 –
The “mail bag” provides insights into the comments and emails (good, bad, or somewhere in between) received from readers and my thoughts on their feedback.
Inbox: Readers think I’m missing a big part The best inflation story in 40 years: Politics.
The feedback said, “The real root cause of this hellish inflation is the policies of the Biden administration, the Democratic Party and its naive and deceptive supporters.” “Hmm,” from the current White resident “House,” “Liar Democrats raise all costs far more than Republicans.”
My reply: It’s time for a trusted spreadsheet. No matter what math I know or use, someone will always complain!
To test the theory of the audience, I looked at inflation rates dating back to World War II and which party dominated the White House. I also staggered the results by 6 months. As a result, some credibility and criticism of what happened during the president’s transition was shared.
Keep in mind that the President is the only force that plays a role in the ever-changing cost of living. The inflationary environment is determined by everything from the economic and political implications of foreign countries to the relationship between workers and their bosses and the Federal Reserve for setting interest rates.
For nearly 80 years, inflation averaged 3.69% when Democrats were in command, compared to 3.59% for Republicans, according to spreadsheets. It’s not a big difference, but we know that politics is a business of “what have you done for me lately?”
Looking at the cost of living when the Democrats had a White House since 1944, inflation rose in four of the five eras, from the year before the Democrats came to power to the last commander.
For the Republican president, inflation rose at the same index in two of the five control periods.
Inflation has one flip side. Overheating prices usually requires a lot of employment, so it often moves in the opposite direction of unemployment.
So let’s use the same math to look at US unemployment during this same post-WWII period. The White House’s Republican unemployment rate averages 5.7%, slightly above the Democratic’s 5.6%.
The unemployment rate increased only once under the Democratic Party during all five periods under Republican control.
This math shows that it is reactionary and stupid to blame inflation for the president or his party, regardless of who is responsible. Living expenses in the United States, in particular, are often heavily influenced by factors that are out of the reach of the world’s most powerful leaders.
Yes, Democratic President Joe Biden has averaged 6.5% inflation over the last 12 months, compared to 1.3% in 2020 before he was elected. If this 5.2% surge represents Biden’s overall presidency, it would only take the lead in the 1977-80-day White House of Democratic Jimmy Carter dating back to World War II.
If it’s Biden’s fault, he should also be confident that the unemployment rate has dropped from 8.1% in 2020 to an average of 4.6% over the last 12 months. That 3.5-point drop was only beaten by Democrat Bill Clinton’s 1993-2000 White House.
Ignoring politics altogether, the main risk these statistics identify in 2022 is the Fed.
Central bank twin chores include spectacular inflation while monitoring the health of the employment market. And as living expenses are skyrocketing at a pace not seen in 40 years, central banks are now raising interest rates they manage to cool demand for goods and services, and preferably slow inflation.
Can the Fed’s calmness be so skillful that millions of jobs aren’t costly?
And you will tell us which is worse: is your salary lacking inflation or is there no salary at all?
Jonathan Lansner is a business columnist for the Southern California News Group.He can reach at firstname.lastname@example.org
Are Democrats to blame for high inflation? – The Denver Post Source link Are Democrats to blame for high inflation? – The Denver Post
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