Many people have seen the purported President of the United States, Joe Biden, stumbling up the stairway to Air Force one, flopping over his own feet like a beached fish. The buffoonish clown representing the United States could not have more aptly demonstrated by any other metaphor the failure of his administration. Biden has also appeared at a microphone, leaning over it as if it was a private message, and in hushed tones, saying, “Pay them more.” He wanted employers to increase the pay of American workers. Not a bad idea, yet exhorting employers to simply pay more as if they were the Federal Government printing up whatever dollars they need, told a deeper story of ignorance and stupidity that, like the bumbling stairway Biden, symbolized the degradation of the office he represents.
The old adage, “Be careful what you wish for, you may get it,” comes into play today as inflation, defined as too much money chasing too few goods has risen to concerning levels. To be clear, economists do not say higher pay is bad for people or the economy if productivity increases proportionately to the rise in pay. Furthermore, a small amount of inflation occurs in a healthy, growing economy. While it is unlikely that anyone paid serious attention to Biden’s remark to raise pay, wages have taken off as the result of a worker shortage (sometimes referred to as a “workers strike”). The problem is that inflation has gone up faster than wages. Jay Powell, the Federal Reserve chairman believes the inflation the U.S. is experiencing is “transitory.” But the English word, which he uses frequently, is so complicated in economic terms he cannot tell us how long transitory is. Better not to predict than predict incorrectly, says the acolyte of American economics.
Biden, indeed, has been the cause of the increasing and persistent inflation the U.S. economy has experienced due to policy decisions that he, or whomever makes decisions from the White House, made. Stimulus payments have flooded the economy with more money than it can handle. Paying unprecedented unemployment compensation and adding an additional $300 per month on top of these payments added additional money and kept people out of the workforce. Why work when you don’t have to? Meanwhile, Biden continues to encourage the Federal Reserve to pump more money into the economy by buying $120 billion in mortgage-backed securities and treasury bills and bonds. It is all tantamount to giving massive intravenous transfusions of sugar into the arteries of a diabetic. The economy has become soaked with cash chasing a limited amount of goods and services.
At Joe Biden’s request, Congress recently passed a so-called infrastructure package in the amount of $1.2 trillion. This will add some to the inflation equation. The package term is over ten years, and won’t be a huge inflation pump to the economy because it’s stretched out provisions are over a term of ten years. There is a threat that Biden’s infrastructure package estimated at $4 trillion by credible sources will contribute additionally to inflationary pressures. Biden says the cost will be zero dollars. Even his propaganda arm, the Washington Post, gave him two Pinocchios (their sarcastic award for lies) for his claim. The value of these spending packages is questionable, but not the whole problem. Putting aside the underfunded Defense budget, Social Security and Medicare are under pressure. Politicians love to spend, especially if the consequences are spread over many years. Some will no longer be in office when the impact of these additional commitments hits the public. Be aware that you have been warned. If the infrastructure bill passes later this month, it is estimated that seven million jobs will be lost due to rising interest rates and other causes. The net result is likely to be stagflation.
One of the great drivers of inflation is the deliberate and successful effort by Biden to jack up the price of oil by denying permits to drill on public land. He has ignored the safe transfer of oil by cancelling the Keystone XL Pipeline whose purpose was the efficient transit of oil by pipeline. By cancelling the Pipeline and denying drilling permits elsewhere, Biden deliberately sabotaged the energy plan of Donald Trump that gave the U.S. energy independence. (Simultaneously he approved a pipeline from Russia to Germany. The latter pipeline now gives Russia valuable currency reserves, creates a European dependency on Russia, and undermines the possibility of U.S. gas sales to Germany.)
At a time when the world has a shortage of energy, the absence of U.S. oil to our own refineries puts pressure on prices in this country. The purpose of this is clear. It is to make windmills and solar cells more competitive with natural gas and oil, and also create an artificial demand for electric vehicles over internal combustion engine alternatives. A policy like this has not been specifically announced by Biden. The reason is simple: rising gas prices hurt the lowest income earners. The man from the party of compassion knows that he is creating pain. This leads him to lie about the cost of his plan—the Green New Deal.
This brings us to the other side of the equation, the supply of goods. For reasons that are not entirely clear, dock workers have not been able to download the vast amount of goods (currently estimated at a whopping one million containers) from the ships now backing up at west coast ports, namely Long Beach and other Los Angeles area port harbors. Additionally, truckers are in short supply and must run their loads through crowded Los Angeles freeways at a crawl. This process has been described as a system of systems. The idea that Biden will be cancelling Christmas, now fast approaching, due to the slow distribution of goods, has finally motivated Biden to do something that didn’t involve climate change. What is particularly disturbing is that Biden now claims he has been working on a solution with stakeholders. It has taken since June to arrive at an agreement to work 24/7 instead of the workers usual work hours. Whether this will solve the problem won’t be known until later. Currently, only one of the six ports in question is already working around the clock. There is no evidence the problem will be solved by Christmas 2021. Good Job Joe. One other factor is the spread of Covid to manufacturers around the globe who have been unable to work. But with over 100 ships backed up at west coast ports, this does not have a major effect on the system. Other than working with dock workers, the Biden administration has failed to stop the growing inflation hurting Americans who want to buy with the money Biden has forced into the economy. The government reported November 2021 and uptick in producer prices of .9%. Accelerating inflation is worsening as America struggles with the policies of ineptitude by those in power.
America did not intend to elect a part-time president working at donkey speed during a pandemic. Something like, warp speed, might have worked better. Mmmmmm, where have we heard those words before.