When it comes to the state of the economy and the impact of President Biden’s policies, the term “Bidenomics” and its consequences have garnered significant attention. Among these consequences, one issue stands out: Bidenflation, which has recently reached a staggering 17.0%. This sharp increase indicates substantial inflation under President Biden’s policies, posing significant challenges to the American populace.
The State of the Economy
We go over the dynamics of Bidenflation, exploring the concerns of Americans, the real impact on wages, and the looming specter of stagflation.
We aim to shed light on the true state of the economy and the effect of policy decisions on everyday Americans.
Bidenomics Crushes Economic Confidence
The term “Bidenomics” is often synonymous with “Bidenflation.” Under President Biden’s leadership, inflation has surged to a concerning 17.0%.
This has led many to question the efficacy of his economic policies, and for good reason.
Concerns About Inflation
Most Americans are deeply troubled by the current inflationary environment. In fact, over 88% of respondents in a recent Investor’s Business Daily/TIPP Poll expressed concerns about inflation.
These concerns have consistently remained high for the past year, with more than 50% being “very concerned” for the past twenty months.
Declining Real Wages
Real wages, which account for changes in the cost of living, have experienced a downward trajectory during President Biden’s term. In 27 out of 33 months, real weekly wages have declined.
While there was a brief period of improvement, this negative trend reemerged in September.
The U.S. economy is currently struggling with stagflation, a troubling combination of stagnant economic growth and high inflation.
This economic conundrum is primarily the result of inflationary pressures stemming from Bidenomics policies. Despite the Federal Reserve’s efforts to contain inflation, these policies exacerbate the issue.
The Statistical Reality
The Consumer Price Index (CPI), released by the government, revealed a 3.7% year-over-year price increase from September 2022 to September 2023.
While it is true that the CPI rate declined from a peak of 9.1% in June 2022, it has been on the rise since July 2023, reaching 3.7% in September.
Furthermore, the situation becomes even more concerning when we consider core inflation.
A Closer Look at Core Inflation
President Biden has touted the reduction in core inflation from 4.3% to 4.1% as a significant victory. However, this perspective lacks a crucial context.
This reduction largely results from the base effect, which distorts the comparison of inflation rates.
Core prices increased from August to September 2023, and the base readings from the same period in the previous year saw an even more substantial increase, creating the illusion of reduced inflation.
Energy Policies and National Security
President Biden’s energy policies have been a concern, transitioning the U.S. from energy independence to dependence.
This shift has enriched Russia’s war chest, while the Strategic Petroleum Reserve (SPR) has been depleted for political gain. These actions not only compromise national security but also exacerbate inflationary pressures.
The TIPP CPI
To gauge the true extent of Bidenflation, the TIPP CPI was developed.
This metric uses February 2021, the month following President Biden’s inauguration, as its base. Using the Bureau of Labor Statistics (BLS) data, the TIPP CPI paints a picture of inflation.
Comparing the TIPP CPI to the BLS CPI yields striking discrepancies. The annual CPI increase reported by the BLS for September 2023 was 3.7%, while the TIPP CPI registered a staggering 17.0%.
The differences are even more pronounced when considering specific categories such as food, energy, and core inflation.
Impact on Americans
The impact of Bidenflation on the American population is significant. More than 60% of IBD/TIPP Poll respondents believe that their wages have failed to keep up with inflation.
This statistic has been consistently high, highlighting the real challenges faced by everyday Americans.
Belt-Tightening Across the Board
As a result of rising prices, Americans are tightening their belts in various areas. The majority have cut back on big-ticket purchases, entertainment, dining out, travel, and charitable giving.
Gasoline prices, in particular, have forced many to reduce local driving, impacting their daily lives.
The Inflation Trend
A closer look at the inflation trend reveals that the situation is far from stable despite President Biden’s claims of success. The three-month average shows an acceleration in the rate of price increases over the past months.
Moreover, the six-month average surpasses the twelve-month average, suggesting a deterioration in the inflation trend.
Inverted Yield Curve
The presence of an inverted yield curve, where short-term interest rates exceed long-term rates, is an indicator of economic instability and potential recession.
The recent inverted yield curve has raised concerns about lower inflation and an economic downturn.
Stagflation and Public Sentiment
As the Federal Reserve raises interest rates to combat inflation, the U.S. government faces challenges in servicing its growing debt.
The October IBD/TIPP Poll reflects negative sentiments about the economy, with over half of respondents believing the nation is in a recession.
Considering these factors and the alarming inflation rates, the United States is poised to experience an extended period of stagflation—economic stagnation and high inflation present significant hurdles for the American economy and its citizens.
The Current Economic State
The current state of the U.S. economy, characterized by high inflation and stagnation, is a grave concern. The impact on everyday Americans is substantial, and policy decisions are at the heart of the problem.
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