The 12-month inflation rate through October reached 6.2%, its highest level since the George H.W. Bush administration in the early 1990s. Bush was the president whose failure to recognize the political impact of rising prices and sluggish wages inspired one Democratic strategist’s retort, “It’s the economy, stupid.”
Even though Bush led the nation through a triumphant invasion of Panama and the lightning ouster of Iraqi forces from Kuwait, economic underperformance undercut his 1992 re-election bid. Future presidents never forgot the importance of keeping the economy humming regardless of whatever else is happening in the world.
President Joe Biden should remember that lesson as inflation continues to soar, largely driven by gasoline pump prices and supply chain problems that are preventing products from reaching shelves. Inflation also normally is driven by too much money chasing too few goods, which is another key point for Biden to consider as he prepares to sign a $1.2 trillion infrastructure bill and continues pushing for a $1.85 trillion social spending bill.
The injection of $3 trillion into an economy that’s still digesting an infusion of $2.6 trillion from pandemic relief measures threatens to throw fuel on an already raging inflation fire. Even if Biden, who turns 79 on Nov. 20, has no intention of seeking re-election, congressional midterm elections are now less than a year away. The clock is running out for him to start showing results or risk dragging Democratic candidates down with his own sagging support ratings.
Maintaining control of Congress is particularly important as Democrats work to complete their investigation of the Jan. 6 Capitol insurrection and potentially hold former President Donald Trump accountable for his role. Speculation is running high that, if given the majority, the GOP might even seek Biden’s impeachment as a tit-for-tat response to Democrats’ two impeachment proceedings against Trump.
Biden has no more ability to unclog ports or control OPEC oil price manipulation than did President George W. Bush when a similar pump price spike occurred in 2008. Regardless, Biden will be targeted for blame as 2022 campaigning heats up. American consumers, who also are voters, don’t want to hear excuses and historical explanations. What they see in the supermarket are rapidly escalating prices for bread, meat, milk and eggs. They can’t buy the cars and gadgets they want. What once seemed like a generous gesture when major employers voluntarily raised wages to $15 an hour now is starting to look woefully inadequate.
Biden could mimic the disastrous program of another one-term president, Gerald Ford, whose solution after an Arab oil embargo was a national cheerleading campaign called “Whip Inflation Now.” Or he can draw from the successful economic management policies of Presidents Bill Clinton and Barack Obama. But whatever he does, he’s got less than 12 months to produce results strong enough to convince voters that his party knows what it’s doing.