The Labor Department is reporting the Consumer Price Index increased 0.6 percent in January on a seasonally adjusted basis, driving inflation up 7.5 percent over the past 12 months.
The statistics, according to CNBC, indicate “a worsening outlook for inflation and cementing the likelihood of substantial interest rate hikes this year.”
The 7.5 percent increase is greater than the Dow Jones estimates of 7.2 percent and marks the highest reading in four decades.
No worries, however. The Labor Department news release indicates the skyrocketing inflation numbers are driven mostly by the basic necessities of life.
“Increases in the indexes for food, electricity, and shelter were the largest contributors to the seasonally adjusted all items increase,” they report.
WASHINGTON (AP) — US inflation soared 7.5% over past 12 months, biggest spike since 1982.
— Zeke Miller (@ZekeJMiller) February 10, 2022
It’s imperative to note that while inflation numbers and charts are devastating, the most devastating impact is what the American people are feeling right now because of that data.
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For Americans trying to afford basic necessities like food and energy, it’s a big problem costing families thousands of dollars.
An analysis published in mid-December by the Penn Wharton Budget Model shows the impact trying to keep pace with inflation will have on the average American family.
No matter which inflation metric you look at, it’s worrying.
Inflation (CPI) for all items is at 7.5% in past year — the highest since Feb 1982. (bluish line below)
Inflation excluding food and energy is at 6% in past year — the highest since Aug 1982. (pinkish line below) pic.twitter.com/8piWJWWoyq
— Heather Long (@byHeatherLong) February 10, 2022
“We estimate that inflation in 2021 will require the average U.S. household to spend around $3,500 more in 2021 to achieve the same level of consumption of goods and services as in recent previous years (2019 or 2020),” the group wrote.
Worse, it’s far more detrimental to lower-income households because a larger percentage of their budget will go towards those basic needs.
“Lower-income households will have to spend about 7 percent more while higher-income households will have to spend about 6 percent more,” they add.
Inflation went crazy in the 70s when the price of oil jumped rapidly while the US pursued massive government spending programs. Led to stagflation, gaslines, economic malaise as supply chains cracked
Just posting today for no reason whatsoever
— Truckistan Amb. Poso 🏁 (@JackPosobiec) February 10, 2022
From a political aspect, the inflation numbers are devastating for the Biden White House and the Democrat Party, in general, heading into the midterms.
It is, as they say, “the economy, stupid.”
The most recent Real Clear Politics average of all major national surveys shows President Biden’s numbers significantly underwater on the topic of the economy.
Only 38.3 percent approve of Biden’s handling of the economy while 56.3 percent disapprove.
— Squawk Box (@SquawkCNBC) February 10, 2022
Tommy Pigott, the Rapid Response Director for the RNC issued a statement blasting the President.
“Unfortunately for the American people, Biden has decided to double down on the policies that caused this inflation in the first place,” Said Pigott.
“Whenever Biden says the word ‘prices,’ remember this: he lied about inflation for months, has lied about its consequences, and has zero credibility on the issue.”
Biden says “unchecked inflation over the long term would pose a real challenge to our economy” but adds he’s “confident that isn’t what we’re seeing today” pic.twitter.com/FDGUKGBpmc
— Bloomberg Quicktake (@Quicktake) July 19, 2021
President Biden over the summer said that inflation at the time was merely transitory, a notion these latest numbers suggest might be incorrect.
“I want to be clear: my administration understands that were we ever to experience unchecked inflation in the long term, that would pose a real challenge for our economy,” he said over the summer.
“While we’re confident that isn’t what we’re seeing today, we’re going to remain vigilant about any response that is needed.”
It’s a real challenge alright, Joe. It’s destroying the budgets of everyday Americans. That’s a problem.
The biggest challenge, however, is trying to survive the next three years with an economically illiterate person sitting in the White House.