President Joe Biden and his media team clearly recognize that the nation’s high inflation rate is at the top of voters’ minds, so they’ve been doing everything they can to shift blame.
The most prominent talking point in recent months has been “Putin’s price hike,” but that doesn’t explain why many other industrialized nations are experiencing lower inflation rates than the United States, some substantially so.
Even Germany — which is heavily reliant on Russian oil and natural gas — currently has a 7.9 percent inflation rate versus 8.6 percent in the U.S. as of last month. That’s the highest the U.S. has seen since 1981.
The fact that Germany’s rate is lower than the rate in the U.S. is enough to make a claim Biden made at The American Federation of Labor and Congress of Industrial Organizations convention in Philadelphia on Tuesday false.
“Under my plan for the economy, we’ve made extraordinary progress. And we put America in a position to tackle the worldwide problem that’s worse everywhere but here: Inflation,” he said.
Joe Biden downplays inflation, claiming it’s “worse everywhere but here”
The U.S. has one of the highest inflation rates in the developed world. pic.twitter.com/2UDqbmE7Mr
— RNC Research (@RNCResearch) June 14, 2022
That statement simply is not true.
Besides Germany, Axios reported America’s inflation rate is higher than several other developed countries.
Did Biden’s policies contributed to higher inflation in the U.S.?
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Figures from the Organisation for Economic Cooperation and Development in April show some of these nations include Canada, France, Israel and Japan.
According to Pew Research Center, the U.S. has the 13th highest inflation rate among the world’s advanced economies.
In the U.S., year-over-year inflation averaged about 2.3% a month between 1991-2019; it exceeded 5.0% only four times during this span. In the first quarter of 2022, inflation averaged just below 8% – the 13th-highest rate among the 44 countries examined. https://t.co/rX5qqyL3hA pic.twitter.com/LkWynuSIWM
— Pew Research Center (@pewresearch) June 15, 2022
This is strange territory for the U.S., which has been in low inflation for decades.
“Between the start of 1991 and the end of 2019, year-over-year inflation averaged about 2.3 percent a month, and exceeded 5 percent only four times,” Pew reported.
When Biden came to power, he made at least two highly inflationary policy decisions: He signed the $1.9 trillion American Rescue Plan into law in March of 2021 (passed without a single Republican vote) and through executive actions clamped down on domestic oil production.
The ARP paid people not to work through enhanced unemployment benefits, direct deposit monthly child tax credit payments, food stamps, etc.
The Foundation for Government Accountability calculated last summer that a family of four could collect nearly $3,700 per month or $44,400 per year by not going back to work.
With employers competing with the federal government, they had to raise wages to try to lure workers back to the job.
Higher wages meant higher costs, which businesses must pass on to consumers to remain profitable.
Additionally, fewer workers also meant fewer products being produced, transported, etc. More dollars chasing fewer goods leads to increased prices.
Then there were the decisions Biden made on the energy front.
In the early days of his presidency, he signed executive orders under the auspices of addressing climate change that included suspending oil and gas exploration leasing on federal lands and reinstating an Obama-era carbon dioxide emission federal fee on oil-drilling operations, which had been lowered significantly under former President Donald Trump.
Additionally, the Biden administration also shut down oil exploration in the Arctic Wildlife Preserve, limited oil exploration in the National Petroleum Reserve in Alaska, scrapped offshore lease sales and canceled the Keystone XL Pipeline from Canada.
Now, the U.S. is producing about 1.3 million barrels per day fewer than at its pre-pandemic peak under Trump, according to the U.S. Energy Information Administration.
Refiners produce about 19 gallons of gasoline from a barrel of oil. So the U.S. is down about 24.7 million gallons of gas a day.
The law of supply and demand kicks in again, and, not surprisingly, the price of a gallon of gas has more than doubled since Biden became president.
So Biden is wrong: Inflation is not worse everywhere else in the world and a major reason it is so high here is him.