Yet another day at Politico, yet another report of a crisis-of-confidence escalation on the Left. Today’s a bit different, though. This time the calls are coming from inside the house, Ben White reports — the White House. Progressives in the administration have begun telling reporters how badly Joe Biden has bungled the messaging on inflation, although not in the way you’d think:
Runaway inflation is crushing President Joe Biden’s approval ratings and threatens to swamp Democrats in the midterm elections.
But many progressives — including some within the administration itself — say Biden’s all-out messaging war against spiking prices is making matters even worse.
They fear that the administration’s unswerving support for the Federal Reserve’s campaign to choke off inflation will slam the brakes on the economy and undercut the few things the White House has moving in its favor. Among them: a strong labor market, solid wage gains and ambitious spending proposals in areas like child care and prescription drug costs that are popular with voters.
“Solid wage gains”? Biden hasn’t achieved any “solid” wage gains, thanks to the inflationary wave that his American Rescue Plan touched off in April 2021. Since then, the Consumer Price Index year-on-year inflation rate has consistently registered above 5% and has been in the 8% range for the last four months:
In comparison, wages have grown at the annualized level of 5% at best over the past year, figures which do not include the impact of inflation. The difference between the two shows that Americans have been watching their buying power erode steadily during the entire Biden presidency. The data from April 2022, for instance, showed a 2.6% decline in real inflation-adjusted wages over the previous year, and we saw similar results in May. June is likely to be no exception.
The strong labor market existed before Biden showed up, too, and still isn’t quite as strong as advertised. We are still recovering jobs from the 2020 pandemic shutdown — about 900K below the February 2020 employment level in a static sense, and about 3 million or so jobs short of where we should be dynamically. Biden’s running around talking about how Donald Trump lost the most jobs ever on his watch, but Trump added most of them back before Biden took office, too — 12.5 million of the 22 million or so lost had already been recovered in just ten months. We’ve added another 8.5 million in the 17 months since Biden took office.
Biden’s actually making that argument for the benefit of progressives, as well as math illiterates and those with memory issues. On inflation, though, progressives inside and outside of the administration want to keep making the argument that it’s merely “transitory”:
Many progressives believe inflation is likely to ease on its own without severe rate hikes; more moderate voices say the only path to improving Democrats’ political fortunes is to bring prices down swiftly.
It’s an excruciating spot for the White House. Polls show inflation is a top concern to voters, so attacking it head-on seems like the smartest political move. Powell and many economists argue that the economy won’t work for anyone if inflation — now at its highest point since Volcker’s day — isn’t reversed quickly.
But progressives worry that Biden is abandoning the liberal vision of government’s role in countering decades of growing income inequality, further assisting women and people of color in making progress in the labor market, and transforming the nation’s infrastructure into one that relies on clean energy.
Biden and his team tried the “transitory” argument in the summer of 2021. How did that work out? (See chart above.) Progressives and the White House tried arguing as late as early spring of this year that inflation had “peaked.” How did that work out? (See chart above.) And now progressives want to keep making the argument that inflation will just disappear on its own?
Indeed they do, because they fear that Biden will eventually stumble over the one solution to it at hand: American energy production in oil and natural gas. Progressives pushed Biden into a back-door Green New Deal policy in the 2020 election cycle, which Biden implemented on Day One with EO 13990 and continues to pursue. Rapid gasoline and diesel price increases are driving inflation far higher than it needs to be, which is why the Fed now feels an urgent need to intervene. If Biden reversed his energy policy to account for a long-term contribution of oil and natural gas, it would not only improve prospects for fixing the supply crisis on fuel of all sorts but also improve the strategic position of the US against Russia and Iran. Otherwise, the only way to pull down gas prices is to induce a recession-caused decline in energy demand — which is exactly the path Biden is treading at the moment.
Politically speaking, this is even dumber than it looks. In every poll, voters are far more worried about inflation, gas prices, grocery shortages, and crime than they are about “income inequality,” climate change, and ethno-racial policies. Let’s use Monmouth again to underscore that point, although the Harvard-Harris poll was just as clear:
Biggest concern via Monmouth poll:
15% gas prices
3% health care
2% tuition costs
1% civil rights
1% climate change
— Ryan Struyk (@ryanstruyk) July 5, 2022
There’s been plenty of naked attacks on Biden in the media from the Left over the last couple of weeks, and most of them have been justified. These gripes from progressives in and out of the White House are all but delusional. The only thing going away in the next few months if this administration doesn’t meaningfully address inflation is Democrat control in Washington.