Mercatus Center economist, Veronique de Rugy, issues a harsh critique of President Biden's Wall Street Journal oped from earlier in the week, detailing what he says are the causes of inflation and his plan to tackle it.
Unfortunately, his plan reveals that his administration is either in deep denial or doesn't understand the real cause of inflation. His proposal, therefore, is all but guaranteed to fail. Absent from the piece is any acknowledgement of what readers of this column know all too well: that inflation was fueled by Biden's own reckless spending policies, especially the $1.9 trillion American Rescue Plan passed in March 2021. Half a dozen or so studies have shown that fiscal policies implemented during COVID-19 are a main culprit behind today's inflation. Biden also fails to mention the Fed's overly accommodating monetary policy and its current slow response to inflation. In other words, the president's argument is amazing for its tone-deafness, inconsistent thinking and sheer economic ignorance.
Federal Testimony: Inflation Is Largely a Demand-Side Problem
Policy Brief: Inflation in Times of High Debt