Independent Vermont Senator Bernie Sanders stated on NBC’s “Meet the Press” Sunday that Pres. Joe Biden’s “American Rescue Plan” didn’t contribute to the country’s record high inflation rates.
According to Bureau of Labor Statistics statistics, inflation jumped 0.4% in September from August, while “core” inflation, which gauges the price of commodities excluding food and energy, reached a 40-year high. Core inflation increased 6.6% year over year, while the Consumer Price Index dipped to 8.2% overall year over year, despite a 0.4% increase in August.
“Do you believe the claim that the American Rescue Plan, approved in early 2021, contributed to the present inflation problem?” Chuck Todd, the show’s host, asked.
“I don’t think so. As I’m sure you’re aware, inflation is currently a global issue. It is 10% in Germany, 10% in the United Kingdom, and 7% in Canada. “The epidemic and the rupture in supply lines are causing worldwide inflation,” Sanders explained.
“It is caused, in my opinion, by the war in Ukraine, but it is also caused by enormous corporate greed. I hope everyone realizes that when you go to the gas station and fill up your car today, the oil corporations and food businesses are generating tremendous profits. Prescription medicine prices are high, and the pharmaceutical business is making huge profits. We have to deal with that.”
In March 2021, Biden signed the roughly $2 trillion American Rescue Plan, which included providing $1,400 stimulus checks to certain Americans. According to The Washington Post, some analysts believe that while inflation would have certainly risen regardless of other circumstances, the so-called rescue plan exacerbated the situation. According to The Washington Post, Francesco Bianchi of Johns Hopkins University co-authored a report that attributed almost half of inflation to the rescue plan.
According to PolitiFact, economist Dean Baker of the left-leaning Center for Economic and Policy Research calculated that the proposal boosted inflation by around two percentage points.
“My major justification for stating this is because other rich nations have had equivalent increases in their inflation rates while having stimulus programs that are not even substantially comparable.”
According to the research, four economists at the Federal Reserve Bank of San Francisco indicated fiscal policies implemented in 2020 and 2021 contributed to rising inflation.
According to The Washington Post, former President Barack Obama’s economic adviser Lawrence Summers has attacked the American Rescue Plan for increasing inflation.
“We could have surely had a world in which we had preserved the economy and produced substantially less inflation. The likely outcome of the inflation we’ve had, in addition to significant decreases in workers’ real earnings, is that the next recession will arrive sooner than it would have otherwise.”
According to Vox, Senior Fellow at the Brookings Institute said, “we would have less inflation and fewer complications that we need to handle right now if the American Rescue Plan had been adequately sized.”
According to PolitiFact, Mark Goldwein of the Committee for a Responsible Federal Budget stated that “the American Rescue Plan was significantly greater than the economy could support.” Goldwein did, however, admit that inflation would have continued to grow in the absence of the plan.