Biden's inflation crisis was a capability crisis.
Joe Biden's presidency has always been marked by improvisation and a tendency to sidestep reality for expediency. But this was rarely more evident than in July 2021, when he assured the nation that “no economist in his right mind” was worried about inflation getting out of control. It was as much a false statement as it was a revelation, a summary of the administration's various opinions. Arrogance, economic mismanagement, wishful thinking.
In retrospect, this moment offers more than a clue to Biden's broader failures. It serves as Exhibit A if Biden's presidency were fundamentally: characterized by incompetence and denial.
Biden dismisses inflation concerns It wasn't just a mistake in words. It was a strange sign that Biden was not engaging with the policy debates taking place across the country.
Democratic and former Treasury Secretary Larry Summers has been sounding the alarm since February 2021, warning: Biden's $1.9 trillion American Rescue Plan There is a risk of overheating the economy. Fellow respected economist Olivier Blanchard echoed these concerns. Even Fed officials were publicly sticking to the word “temporary,” though privately they were grappling with the possibility that inflation would persist.
At the time, we saw Biden's assertion that such warnings did not exist as deliberate falsehoods. Now Biden is just shunned by Democratic critics about his policies.
Over time, it became clear that the Biden administration's blind spot on inflation was not just about inflation. It was about the Biden administration's widespread inability, or unwillingness, to confront hard truths. Administration again and again We doubled down on policies that were just making the crisis worse. It tried to manage the following:
- spending overdrive: The American Rescue Plan was not just unnecessary, it was reckless. The economy is already recovering from the pandemic, and there are trillions of dollars of unspent stimulus still floating around. Injecting nearly $2 trillion more into the system was a surefire way to overheat demand.
- energy myopia: Biden's early hostility toward fossil fuels, from canceling pipelines to limiting domestic drilling, compounded the energy price shock as global supply chains stalled. Inflation is not imported, it is created in Washington.
- Transfer of responsibility: When inflation finally reared its ugly head, the administration resorted to distraction, pinning the problem on corporate greed, transportation bottlenecks, and ultimately the Ukraine war. This widespread blame game may have fooled partisans, but it did not fool voters.
result? Inflation will reach its highest level in 40 years by mid-2022, crushing real wages and eroding household wealth. No matter what progress the administration claims in reducing unemployment or passing legislation; drowned out by obvious economic pain About everyday Americans.
What is surprising about Biden's false inflation guarantee is how it applies. Broader denial patterns. This was not the only issue in which the administration appeared more interested in controlling the optics than tackling the material.
- Afghanistan: A disorderly withdrawal was defended as inevitable, even though military experts had long warned that a hasty withdrawal would create a vacuum of chaos.
- border: Record-breaking illegal crossings were dismissed as seasonal or exaggerated until the problem became too obvious to ignore.
- crime: Escalating violence in cities across the country was initially ignored, only for Democratic mayors to call for more enforcement.
In both cases, the warning was ignored until the next stage. reality can no longer be denied–And by then the damage had been done.
I've always been incompetent
recent wall street journal article highlighted Biden's mental declinesuggesting that his declining abilities were an open secret among his inner circle. This will go a long way in explaining the administration's repeated failures. But even without that explanation, Biden's presidency has been defined by a lack of curiosity and accountability, qualities essential to effective leadership.
The inflation fiasco is a case study of how this administration has operated.: Denying the existence of a problem, deflecting blame when it occurs, and delaying action until the damage is irreparable. Inflation was not just an economic crisis. It was a political move that shattered confidence in Biden's ability and set the stage for the eventual collapse of his presidency.
