Let’s give former Biden White House Chief of Staff Ron Klain an A for honesty. He admitted last week what voters have been saying for three years: Inflation is killing them.
Klain admitted on MSNBC that “although inflation has moderated, prices are still high, the price of gasoline is still high, other prices are still high, and people feel that pinch.”
Calling Bidenflation a “pinch” is like calling the bridge collapse in Baltimore a minor traffic delay.
The real tragedy of the Biden economy — and the reason a majority of Americans are telling pollsters they are worse off today than four years ago — is that their paychecks have shrunk.
That’s true no matter how you slice and dice it.
According to the most recent Census Bureau data, the median-income household has lost nearly $2,100 in annual purchasing power.
The more recent Bureau of Labor Statistical data show that through the end of 2023 weekly real earnings were down about $2,000 since Donald Trump left office.
Wages are finally starting to rise faster than inflation — as the most recent jobs report confirms — but the gap still remains negative for Joe Biden more than three years into his presidency.
This is a sharp contrast from the Trump years, when annual incomes for middle-class families were up by more than $5,800.
Amazingly, this improvement is even true when accounting for the severe drop in economic activity due to COVID lockdowns.
Meanwhile, the progress on inflation has stalled out again.
Gas prices are surging again, indicating the middle-class squeeze is still on.
As a reminder: The gas price at the pump was $2.49 a gallon and it now stands at $3.58 a gallon.
This is roughly a $15 per fill-up “tax” on motorists.
Commodity prices — from copper to corn to gold — are up 12% this year.
Add to that mortgage payments. Under Trump the average mortgage interest rate was a little over 3%; today mortgage rates are closer to 6.5%.
That means the average mortgage payment has risen from roughly $2,000 to almost $3,000 a month — a near 50% rise in just four years.
The American dream of homeownership is increasingly out of reach.
Also notable: The official Consumer Price Index numbers, which say that prices are up 18% since Trump left office, doesn’t include “shrinkflation.”
Smaller servings at restaurants, fewer chips in a bag of Doritos. You pay more and get less.
Biden blames the inflation on greedy corporations.
His solution is to raise business taxes to reduce profits of corporate fat cats.
But if you raise taxes on businesses, the companies will have to raise their prices worse.
The White House seems mystified that Americans on Main Street USA aren’t feeling the love for Bidenomics.
Maybe that’s because those who live in the fairly-tale land of Washington, DC, are doing just fine.
The problem is the benefits of the trillions of dollars of debt spending aren’t trickling down to middle America.
Ron Klain is right to sound the alarm for the Biden White House.
The happy talk is only making Americans more worried and angrier.
The last time we had persistent inflation and shrinking paychecks like this was when Jimmy Carter was running for reelection in 1980.
Then as now, Americans felt worse off than they were four years ago.
And Ronald Reagan won 44 states.
Stephen Moore is a senior fellow at the Heritage Foundation and a co-founder of the Committee to Unleash Prosperity.