The Republican Party sees inflation as a winning issue

Republicans see rising inflation as a winning issue as the party shapes its lines of attack against President BidenJoe BidenJudge Rejects Trump’s Request to Delay Release of Jan.6 Papers Amid Appeal On Money: Biden’s Battle with Inflation Night Defense and National Security: Russia Concerns Increase MORE and Democrats in negative votes before the midterm elections.

Annual inflation jumped to 6.2 percent in October, according to data released Wednesday by the Labor Department, reaching the highest level in more than 30 years. Prices rose 0.9 percent last month alone, marking the third consecutive month of accelerating inflation.

Republicans have spent months blaming Biden and Democrats for rising food and gas prices, and inflation was a central focus of the governor-elect. Glenn youngkinGlenn YoungkinMellman: Aftermath of the 2021 Election: How Big Was That Change? Biden faces high stakes with progressives in the Fed election, Sununu’s departure underscores the GOP’s uncertain path to winning a Senate majority MOREThe (R) successful bid for the Virginia Governor’s Mansion. While Democrats hope to celebrate the passage of Biden’s bipartisan infrastructure package and focus attention on the bright spots in the economy, the Republican Party is betting that Americans will care more about the daily pinch they feel in the store or in the spout. And they will blame Biden’s agenda.

“American families are facing record costs for everyday goods, from gasoline to groceries, yet Joe Biden continues to push for trillions of dollars in wasteful spending and the largest tax increase in decades,” said the president of the Republican National Committee. Ronna McDanielRonna Romney McDaniel The Hill’s 12:30 Report: All Eyes on Rittenhouse Homicide Trial Trump Backed Off Threat to Leave Republican Party: Book The White House Faces a Barrage of Vaccine Rule Challenges MORE it said in a statement.

The Republican Party telegraphed earlier this year that they were going to make inflation a key issue in the midterm elections, with the Campaign Committee of the Republican National Congress launching announcements in July.

Republicans saw the first signs of success on the issue in Virginia last week, leading to the party’s unification on messages related to the issue.

“The entire Republican ecosystem is united in this fact because it is an important issue with voters,” said one Republican strategist.

Earlier this month, the Club For Growth launched an ad campaign targeting a group of moderate Democrats, targeting inflation while urging them to oppose Biden’s social spending plan. On Thursday, The Coalition to Protect American Workers, a group led by Mike penceMichael (Mike) Richard Pence Intermissions are coming: Will we get answers on January 6 before it’s too late? Jan.6 call logs show senior Justice Department officials spoke to Pence, White House subpoenas show Jan.6 panel’s focus on Trump’s plans MOREFormer chief of staff Marc Short launched a six-figure ad campaign targeting some of the same lawmakers over the price hike.

And it’s not just Republicans at the top of the list who are focusing on the issues. Republicans on the ballot say inflation is a prime example of a kitchen table problem.

“We will continue to talk about those issues, we will continue to talk about the failures of the Biden administration to fix that and help him,” said Dee Duncan, chairman of the Republican State Leadership Committee.

Surveys suggest that such attacks could be effective.

Biden’s overall approval rating and voter views on his handling of the economy have plummeted since the summer as prices rose. While job growth, the stock market, consumer spending and household savings remained strong, the emergence of the delta variant of the coronavirus in late July bogged down supply chains and dumped more fuel into the economy. inflation.

Voter confidence in the state of the economy fell to its lowest level since January in October, according to a Gallup poll, even though 74 percent of those polled said it was a good time to find a job from quality. The number of respondents who cited high prices as the biggest problem facing the United States also jumped from 1 percent in September to 5 percent last month.

At the same time, an AP-NORC survey found that 65 percent of Americans rated the state of the economy as “poor,” and a NBC poll showed that 57 percent of people disapprove of Biden’s handling of the economy.

Rising prices overshadowed other areas of strength in the economy, particularly as sharp jumps in food and energy prices stretched household budgets for cash-strapped families. Food prices jumped 5.3 percent in the year prior to last month, according to the Labor Department, energy prices soared 30 percent and gasoline prices jumped a whopping 49.6 percent. hundred in the same time.

“For most Americans, even small cost increases are extremely painful. There’s much less room for error, “said Karen Petrou, managing partner at Federal Financial Analytics and author of” Engine of Inequality: The Fed and the Future of Wealth in America. ”

“Thirty years ago, America had a middle class better able to absorb cost increases and it was very, very painful. And in 2021 we will no longer have the middle class with that capacity to cushion some shocks. “

The United States is one of many wealthy nations struggling with higher inflation as consumer demand overwhelms supply lines still struggling to recover from the onset of the pandemic. Most economists say there is little that Biden can do on his own to cool a global rise in prices, which will likely decline as the pandemic fades.

Still, the sharp rise in prices has put voters against Biden and the Democrats at a dangerous time.

“These are the same voters that Trump sought in every way [by raising] cultural issues and voted for Biden last year. What is different? It’s the economy, ”said Petrou.

Democrats, however, say that passing legislation like Biden’s infrastructure package will ultimately alleviate the effects of inflation.

“I think a lot of what we are doing here is actually going to curb inflation in the coming months,” said the Rep. Susan wildSusan Wild ‘Finally, Infrastructure Week! ‘: White House welcomes Bill T Democrats race to agree on prescription drug prices Biden’s spending framework leaves Medicare out negotiating drug prices MORE (D-Penn.) During a press call on Wednesday.

Wild said that people who rejoin the workforce and put the supply chain back in order “are going to curb inflation much more than anyone expected.”

“I hope that no one tries to link the passage of these two bills to current inflation rates because there is simply no relationship,” he said.

But that’s exactly what Republicans are working to do, tying the price hike to “reckless” government spending.

“With Democratic governance it will probably be the new normal, that’s what America has to wake up to,” the Senator said. Ron JohnsonRonald (Ron) Harold Johnson Democrats begin bombing to sell infrastructure Sununu exit underscores GOP’s uncertain path to Senate majority Biden touts agenda while celebrating Milwaukee Bucks in White House MORE (R-Wis.), Who has yet to announce whether he will run for reelection next year.

Rising inflation poses an immediate threat to Biden’s “Build Back Better” plan, $ 1.75 trillion social services and the climate bill Democrats want to pass budget reconciliation.

The process allows legislation to pass through the House and Senate with simple majorities, but faces increasing threats from conservative Democrats like the Sen. Joe manchinJoe ManchinOn The Money – Biden’s Battle with Inflation Telehealth was a godsend during the pandemic; Congress should keep innovation going Biden takes an inflation hit MORE (DW.V.), who raised the alarm about spending more money amid rising prices.

“From the grocery store to the gas station, Americans know that the inflation tax is real and DC can no longer ignore the economic pain Americans feel every day,” Manchin tweeted Wednesday.

White House officials and Democratic lawmakers have insisted that the Build Back Better plan will actually fight inflation by lowering the price of child care and prescription drugs. They have also argued that the infrastructure bill will help expand the workforce and boost productivity through much-needed updates.

While any deflationary shock could take months, if not years, even economists critical of the White House’s handling of inflation say dual infrastructure bills are unlikely to spur further price growth.

“The 10 years of the two spending bills together, A, are less than a year than they did last spring and, B, unlike what they did last spring, are paid for with tax increases.” said former Treasury Secretary Larry Summers. , a Democrat who has blamed part of the high inflation on Biden’s stimulus plan.

Democrats have proposed a series of tax increases to wealthy individuals and corporations to pay for the Build Back Better plan. Covering the cost of new federal expenditures with revenue generally limits their impact on inflation.

“I don’t think it is an inflation problem. I believe that many of them are vitally needed investments in the future of our country, ”said Summers.

And Petrou, unlike Summers, believes the March stimulus bill played a “remarkably small” role in stoking inflation.

“That is not the expense that drives demand. It is giving families a little less financial fragility, ”said Petrou.

Progressive supporters of Biden’s agenda have also tried to highlight the ways in which the March stimulus bill is helping many families meet the higher costs brought on by inflation. Along with another round of direct stimulus controls, the American Rescue Plan expanded the child tax credit and allowed families to collect those payments each month.

The relief law also increased the maximum credit amount for 2021 from $ 2,000 per child to $ 3,600 for children under 6 and $ 3,000 for children 6 and older. It also made credit fully available to lower-income families.

“That is covering the increases in grocery bills. That’s very important, “said Claudia Sahm, former director of research at the Federal Reserve, in an interview with” Rising “on Hill.TV.

“Congress knew with the Rescue Plan that we would need a lifeline through this pandemic,” he continued. “This money that goes to children is an investment in our future. There is no better money we can spend. “



Reference-thehill.com

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