According to the worrisome figures announced this week, consumer prices soared 9.1% compared to a year earlier.
"One way to put this in context,” explains EJ Antoni, a Heritage Foundation economic researcher, “is that prices are now rising as fast in a single month as they did in a whole year when Biden first became president.”
On a monthly basis, consumer prices jumped 1.3% from May to June which came after prices jumped 1% from April to May, The Associated Press reported. That figure means, for example, a $1 can of corn jumped a couple of pennies over four months but, in reality, that same can probably cost 80-90 cents last year. So every item in the cart reflects that change, especially the skyrocketing cost of meat.
Americans who are buying groceries, shopping for clothes and paying the electric bill are experiencing a price shock the American public hasn’t seen since 1981, the year Ronald Reagan took office after the country experienced inflation under Jimmy Carter.
“Inflation,” Reagan said on the campaign trail, “is as violent as a mugger, as frightening as an armed robber and as deadly as a hit man.”
'Long line' of economic mistakes
According to Antoni, the American people are paying the price right now for a “long line” of mistakes made in Washington, D.C., from the Federal Reserve to Congress.
"It's a long line of government policy mistakes that began with the Federal Reserve creating too much money,” he explains, “and failing to rein in all of that monetary stimulus, but beyond that all of the terrible tax and spending policies of the Congress and the President.”
The blame for that can be spread across both political parties. Fossil fuel-hating Democrats have openly bragged that Americans are hurting when they fill up their big trucks and gas-guzzling SUVs. Those record-breaking gas prices account for a lot of the inflation numbers.
"Energy alone comprised nearly half of the monthly increase in inflation," President Biden, who also took credit for a drop in gas prices, said this week.
Across the aisle, Republicans in Congress helped President Donald Trump pass $3 trillion in COVID-related relief spending in 2020, first in March and a second smaller package that was approved in December. Just three months later, President Biden signed the $1.9 trillion American Rescue Plan without any votes from a Republican.
Wholesale prices jumped 11%
According to Antoni, the reason inflation will keep hurting the public through 2022 is because it takes time for the pain to get passed along. Even if diesel prices drop, the affect of high prices on trucks and deliveries will linger because the pain of $6-a-gallon diesel will passed on to the businesses and then the consumer.
"It's going to take months and, in fact, even more than a year,” Antoni warns, “before those policies have their full effect."
In his interview with AFN, the Heritage expert said one figure to watch is the Producer Price Index, or PPI, which he says has "run hotter" than the Consumer Price Index during every month of the Biden presidency. PPI is the cost a restaurant incurs to purchase a hamburger with all the fixings before it’s handed to the customer out the drive-through window.
A day after Antoni talked to AFN, the Labor Dept. announced the PPI jumped 11.3% in June from the previous year. That figure is also commonly referred to as the wholesale price for the hamburger meat, bun, pickles, onions, and mustard.
Back in 1981, after vowing as a candidate to tackle inflation, President Ronald Reagan oversaw an unemployment rate of 8.5% and mortgage rates that averaged 13% after the public had lived through years of hard times. Inflation had finally been tamed to 4% by 1983 after peaking at 22% in 1980.