While the nation’s economy continues to recover from the pandemic, Republicans are placing the blame for rising inflation on Democrats and President Joe Biden. In a news conference, the Chair of the House Republican Conference, Rep. Elise Stefanik, said that “inflation is skyrocketing because of Democrats reckless and wasteful spending” and “this rampant inflation is a result of Democrats reckless tax and spend policies.” Back in July, Minority Leader Rep. Kevin McCarthy tweeted, “Inflation is running rampant due in part to out-of-control spending from President Biden and Speaker Pelosi.” But are they right? Are Democrats to blame? CNN has done some fact-checking to get to the bottom of it.
Fact-checking Republican attempts to blame inflation on Democrats
As the US economy gradually recovers from the coronavirus pandemic, prices are rising across the board with inflation exceeding the Federal Reserve’s 2% target and reaching a 13-year high in June. Republicans have turned that jump in inflation into a political talking point, trying to place the blame on President Joe Biden and Democrats, and at times misrepresenting the current economic landscape in the process.
In mid-July, Minority Leader Rep. Kevin McCarthy tweeted, “Inflation is running rampant due in part to out-of-control spending from President Biden and Speaker Pelosi.”
About two weeks later, the chair of the House Republican Conference, Rep. Elise Stefanik, went a step further in blaming Democrats, saying in a press conference that “inflation is skyrocketing because of Democrats reckless and wasteful spending” and “this rampant inflation is a result of Democrats reckless tax and spend policies.”
Later that day, in an interview with Newsmax, Republican Sen. Ted Cruz suggested Republicans should not support Democrat-led initiatives that call for more spending and cited Biden’s several trillion dollar proposed budget, claiming “when it comes to spending, spending trillions is what is driving inflation.”
On Monday, Rep. Jim Jordan tweeted that Democrats “spend trillions of dollars. Then ignore inflation.”
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Treasury yields shoot higher after unemployment rate falls to 5.4%
U.S. Treasury yields climbed higher Friday morning as the Labor Department’s highly anticipated jobs report came out better than expected.
The yield on the benchmark 10-year Treasury note added nearly 6 basis points, rising to 1.277% at 8:35 a.m. ET. The yield on the 30-year Treasury bond rose close to 6 basis points to 1.92%. Yields move inversely to prices.
Despite fears about the spread of the Delta variant of Covid-19, which has rattled bonds and equities in recent weeks, hiring for the month of July increased, the Labor Department reported Friday. The economy added 943,000 nonfarm payrolls and the unemployment rate dropped to 5.4%, according to the department’s Bureau of Labor Statistics.
Economists expected the U.S. economy to have added 845,000 jobs last month, according to estimates from Dow Jones, and 5.7% unemployment.
Employment data is key to the Federal Reserve’s decision to pare back its bond-buying program, beginning the process of tightening its easy monetary policies more broadly and acting as a precursor to the raising of interest rates.
Read the full story, here.
Stimulus has been ‘outsized’ in US vs. rest of world: Market expert
Federated Hermes senior equity strategist Linda Duessel warns that the U.S. is overspending on stimulus.
You can watch the full interview, here.