Inflation hits highest level in 40 years, surging 7% in December as Biden seeks more spending

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Inflation reportedly reached a 40-year high in December 2021, with the consumer price index (CPI) having risen by a full 7 percentage points since December of the previous year. CPI is a measurement of how much daily living costs for the average person.

This massive jump marked “the fastest increase since June 1982, when inflation hit 7.1%,” according to Fox Business Network.

Core CPI, which is a separate measure that excludes the volatile changes in food and energy prices, meanwhile rose to 5.5 percent, up from 4.9 percent in November.

Fox Business Network notes that only “energy prices fell 1.1% in December from the previous month,” though “they’re still up 29.3% from last year.”

Gasoline, meanwhile, was up 49.6 percent from 2020 prices, while food was up 37.3 percent and used car/trucks were up 6.3 percent.

All of this is, as noted by The New York Times, “bad news for the Biden White House,” particularly going into this year’s midterm elections.

As of Wednesday morning, President Joe Biden’s average job approval on the economy was at a dismal 40 percent, with USA Today/Suffolk, Fox News and CNBC having recorded recent rates as low as, respectively, 39 percent, 38 percent and 37 percent.

(Source: RealClearPolitics)

The president’s solution meanwhile remains the exact same as it’s been since he took office in January: Spend more money.

“The Biden administration is preparing to ask Congress for ‘substantial’ funding to address the ongoing COVID-19 pandemic domestically and abroad, according to House Majority Leader Steny H. Hoyer,” Roll Call reported Tuesday afternoon.

“The Maryland Democrat told reporters Tuesday during a pen-and-pad briefing that he expects the White House will ask lawmakers to appropriate funding for testing, vaccines and ‘to make sure schools have resources to keep themselves safe.'”

This could and will likely be a problem.

“High inflation is a political liability for the White House as Democrats head into a midterm election year when they will battle to retain control of Congress. Republicans have increasingly accused President Biden of driving prices higher by flooding the economy with too much money, including a third round of stimulus checks,” even the Times admits.

And the accusations appear to be working, judging by the reaction to Roll Call’s reporting:

All this comes as so much of the original COVID relief money remains unaccounted for — a fact so disturbing that even left-wing commentator Chris Hayes has noted it.

“I feel like there’s a weird memory-holing of the fact last spring Congress distributed $123 billion dollars to K-12 schools for Covid preparedness. That’s nearly $1 million *per school*. So big q is: what was that used for?” the left-wing MSNBC host tweeted last week.

As previously reported, a large chunk of the money wound up being wasted on unrelated measures such as the recruiting and training of more teachers and the paying off of debt.

The inflation that the Biden administration appears hellbent on exacerbating is forcing the Federal Reserve to raise interest rates, a move that’s expected to reduce inflation in the long-run, albeit while triggering its own assortment of problems.

“Worries about the impact of a rise in interest rates on the value of future earnings are threatening to turn into a painful reckoning for many tech investors,” The Guardian notes.

“When interest rates are rising, both businesses and consumers will cut back on spending. This will cause earnings to fall and stock prices to drop,” according to Investopedia.

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Vivek Saxena

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