President Biden continues to support his Build Back Better initiative.
Washington’s latest inflation report shows prices rising by 8.3% over the past year and core inflation (which excludes volatile food and energy prices) continuing to accelerate. Real wages have fallen 2.7%. Moody’s Analytics and Penn-Wharton estimate that inflation is costing the average household $300 per month. A Harris poll reveals that 84% of Americans are cutting back on key purchases. And the problem is deepening every month.
The Federal Reserve must lead the charge of reducing inflation. After dumping $4.8 trillion into the economy during the recession and continuing to buy mortgage-backed securities as recently as two months ago, the Fed is finally taking inflation seriously by raising rates and reducing its balance sheet. This will be painful but necessary.
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Brian M. Riedl is a senior fellow at the Manhattan Institute. Follow him on Twitter here.
This piece originally appeared in New York Post