Families across America are watching their bank accounts with growing concern. Prices are increasing from the gas pump to the grocery store aisle and everywhere in between. Wages, on the other hand, aren’t increasing anywhere near fast enough to keep pace.
That’s textbook inflation, and unfortunately, it appears it’s going to weigh on our economy for the foreseeable future.
But while everyday Americans are pinching pennies to stretch their paychecks further and further, one group is on a spending spree the likes of which we’ve rarely seen in our history. No, it’s not the cryptocurrency millionaire next door… it’s the federal government.
The most prominent example of today’s free-spending feds is the Biden infrastructure bill, a roughly $1 trillion package intended to spark a long-overdue and much-needed wave of investment in America’s crumbling infrastructure.
It sounds good on paper, and indeed, the bipartisan bill has earned support from a majority of Americans polled – despite the weeks of chaos and embarrassing infighting that preceded passage as Democrats worked to wrangle voting blocs across the ideological spectrum within their own party.
Supporters of the bill contend its passage will help address the growing wave of inflation that’s plaguing American families. That’s a very tough sell, but maybe, in a vacuum, one could make the pitch with a straight face. (Though I can’t say I’d bite on that pitch.)
Investment in infrastructure is certainly a good thing for our nation, and down the road, it’s possible that the jobs and economic activity generated by this type of investment could benefit families. But make no mistake: It will be a long, long time before these benefits are felt in any of the households hurting today.
Put another way, the bill doesn’t do much to blunt the pain so many are facing today. And as we watch prices at the pump continue to soar, it’s also worth noting that the infrastructure bill is funded in part by the sale of oil from the Strategic Petroleum Reserve. It’s difficult to reconcile the use of SPR oil as a pay-for while at the same time hearing calls from Democratic senators like Chuck Schumer to tap into the SPR as a means of immediately addressing high gas prices.
Unfortunately, policy doesn’t exist in a vacuum. And the stunning fact of the matter is this infrastructure bill – at more than a trillion dollars – is only a drop in the bucket when it comes to the Biden White House’s broader spending wish list.
The administration and its allies in Congress pushed relentlessly to advance negotiations surrounding an even more costly proposal in tandem with the infrastructure bill. The other item on President Joe Biden’s Christmas list clocks in at $1.85 trillion and features everything from social safety net provisions to policy aimed at addressing climate change and rewriting the tax code.
Perhaps most concerning of all is that these eye-popping spending numbers may be conservative estimates of the true cost of some of the programs on the docket. While the $1 trillion number has been cited ad nauseam and even propped up as a reasonable fraction of some of the earlier estimates, the fact is that critics have expressed concern that clever accounting and gimmicks conceal the true costs of the plan over time.
The political class will debate the merits of the infrastructure bill and the “Build Back Better” plan endlessly in the weeks and months ahead. Voters, ultimately, will make their thoughts known on the measures when they go to the polls during next year’s midterm elections.
Be that as it may, one thing remains true no matter what side of the spectrum you’re on: spending like this feels wrong when so many are feeling the pinch of inflation. And while it may be comforting to think that perhaps, one day, big government spending will have an impact on our personal pocketbooks, I fear that day is too far down the line to help those facing struggles right now.