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May 27, 2021

The Biden White House has made four big economic mistakes in just four months

Liz Peek Articles

Paul Krugman declared in a recent New York Times column that Republicans are threatening “America’s democratic experiment.” He followed up that declaration with a series of nonsensical scenarios not worth repeating.

What is worth repeating is Krugman’s assertion that the “Biden team” includes nearly every “genuine expert on tax policy, labor markets, etc.,” a welcome contrast apparently to the Trump administration, which relied on the advice of “politically reliable cranks.”

You know, the kind of cranks who helped President Trump deliver record-low unemployment for Black and Hispanic Americans and the fastest-growing wages in decades, with near-zero inflation.

Krugman’s faith in experts – at a time when Dr. Anthony Fauci epitomizes for millions the fallibility of “experts” – is touching. It is also misguided. 

In just four months, the Biden economic wizards have made several major economic mistakes, some of which were contained in the American Rescue Plan (ARP).

First, there’s that pesky $300 per week supplemental unemployment insurance that is most definitely making it harder for small businesses to hire back staff and limiting job growth. That the Biden team insisted on including an extension of those payments in the ARP was an early indication that they are ignorant of how real-life businesses function.

Next up is the ARP itself, and subsequent proposals to spend another $4 trillion. The White House’s $1.9 trillion stimulus bill that passed in March was too big and too inflationary; talk of trillions more on the way alarmed the public even as prices on everything from soft drinks to diapers began to rise.

Growth during the first quarter, when the bill was crafted, approached 6.5 percent; after-tax personal income rose 13 percent. Spending was primed to soar; last year consumer net worth rose 10 percent, to $130 trillion, thanks to rising stock and home prices, and Americans held an estimated $2 trillion of excess savings.

Though there were still millions of people unemployed, it was clear that thanks to vaccines, businesses reopening and past giant stimulus bills, the economy would boom, and job creation would follow. Dropping $1.9 trillion of extra stimulus into the mix was excessive and has contributed to surging inflation, which is even now souring consumer optimism and possibly dulling the vibrant snap-back.

The third major economic goof of Biden’s first four months in office – also related to the ARP – was highlighted recently in Krugman’s own paper with the headline: “New Worry Over State Revenues: They’re Soaring.”

Rising state incomes should not be a negative, unless you’ve just sent an unnecessary $350 billion in taxpayer dollars to those swollen state coffers, which is what Biden and his trusty experts did in the ARP.

The $350 billion, dubbed “emergency funds” by the media, was allocated based on the number of people unemployed in cities and states during the final quarter of 2020. Republican mayors and governors managed their virus-stricken cities and states better than Democrats; lockdowns were less severe and the local economies less damaged.

As a result, New York State, for instance, stood to receive $22 billion, while Florida was projected to receive $8.8 billion, even though Florida’s population of 21.5 million tops New York’s 19.5 million. The reason? Florida’s unemployment rate at the end of last year was 6.1 percent, way below New York’s 8.2 percent. For that failure, New York was rewarded by Joe Biden.

The Biden team set hard limits on how local authorities could spend the funds, suggesting that even as they wrote and passed the bill, they knew the funds might not be needed. Most absurd, the monies could not be used to cut taxes, which prompted a lawsuit from the attorney general of Ohio.

The money can be spent indirectly pumping up Democrat-friendly union memberships. Approved uses include spending on public health (to the benefit of the SEIU) and offsetting a reduction of public sector workers (nearly all of whom belong to public employee unions and vote Democratic).

Keep in mind, these funds are in addition to the $130 billion allocated to schools. The teachers’ unions are already taken care of.

In February, JP Morgan Chase published a piece showing that states were not as badly hit by the virus lockdowns as expected. The analysis found a revenue shortfall of only 0.12 percent across 47 states in last year’s first nine months. Nearly half the states saw income actually increase.

The Biden team knew the funds were excessive, but they went ahead, citing the desire to avoid the mistake made during the Obama years of not beefing up local budgets. They are fighting the last war; it was not inadequate spending that slowed the Obama-Biden recovery, it was disruptive regulation, a path which Biden appears bound to follow.

Finally, Biden could not resist kowtowing to the progressives in his party by proposing massive tax increases on corporations and high-earning individuals. His plan immediately alarmed small business owners and CEOs of large firms, which filters down to fewer hires and less investing. It also spurred even more residents of high tax states like New York and New Jersey to consider moving to Florida or other more welcoming locales.

Despite Biden’s promise to limit taxes to people making over $200,000, a recent Harvard CAPS-Harris poll shows that even though voters approve of making the wealthy pay more, 64 percent thought that “raising taxes could cost the economy jobs and growth” and that 60 percent oppose hiking taxes on capital gains.

The Biden team is fortunate to have inherited an economy primed to grow rapidly and to create jobs. All they have to do is keep their hands off. That will doubtless prove the biggest challenge of all.

https://thehill.com/opinion/finance/555633-four-big-economic-mistakes-by-bidens-white-house-in-just-four-months

Published on The Hill

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California begged for a federal Covid bailout and now has a $98 billion budget surplus. Devastating reality https://t.co/QjP8PZeQG6

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Repeat: @jakejsullivan was all in on #RussiagateHoax- how can a partisan liar be National Security Advisor?

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Liz Peek

6 months ago

Liz Peek

Are you better off than you were 2 years ago?
www.foxnews.com/opinion/inflation-hurting-americans-biden-bill-worse-liz-peek
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Inflation already hurting Americans, and Biden's Build Back Better will make things even worse

Are you better off than you were two years ago? That’s what Republicans will ask voters a year from now.

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Inflation is worldwide and COVID induced.

3/7

Swamp Think

Peek's article posted today on the Fox News website did not mention one word about President Trump's accomplishment of not only leading the way to American Energy Independence but for the country to become net exporters of the energy we and our allies could really use now.

Under President Trump, oil was in the low 40s (while on the same page, oil traders are now predicting as high as $200/barrel this month!), gas in our tanks cost below two bucks, inflation was under two percent and gas station attendant Putin with an economy about the size of Italy's and who is totally dependent on the price of energy was placed in an economic cage… by President Trump.

Instead Peek gives credit to media Saint Obama for his "all the above" strategy which consistent with how he operated was all campaign talk with ZERO follow through.

Does Peek not remember that Saint Obama's response to Putin invading Crimea was to send blankets.

If you want a quick read on Swamp Think, check in with Fox News.

From the Murdoch boys and Paul Ryan on down, no one is pushing the self-serving, elite globalists agenda of running the world as their personal piggy bank harder than Fox News.

And how are the globalists doing at managing world affairs?

No Trump, No Trump Doctrine

There's a growing rumble, by the minute, from people all over the planet who are suddenly missing Trump's policies, not necessarily Trump.

First, Trump's policies, domestic and foreign, were clear and common-sense driven which is anathema to the Swamp control freaks who thrive on complication and confusion to mask their real agendas and who they're really working for.

Second, the hypocrites who are now lamenting Trump's policies are the same, domestic and foreign, who fought Trump every inch of the way to prevent the implementation of policies that clearly worked.

Third, without Trump the fighter, no Trump policies would have ever seen the light of day.

And without what is now collectively the Trump Doctrine, what clear metric would we have to truly understand the depth and devastation of the Biden/Swamp debacle?

Don't you know that the global supply chain story is done on purpose for there to be empty shelves at the grocery stores and what not to screw with the public. This is done by the world economic Forum with the likes of Klaus Schwab Bill Gates and George Soros and their ilk

YOU are the delusional personality, dear. Sticking it against the US to please 🖕trump and putin. Disgusting anti American.

Maybe Liz you would support some immigration reform , you bitch about not having enough servers in your entitled selfish world , oh and you are against mask wearing too , how trumpian of you, the pandemic is all a hoax to you , just dont get sick out there might not be any hospital beds for you . The drs and nurses are sick and tired of taking care of anti mask anti vax selfish repubs Go claim your Darwin Award .

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Liz Peek

6 months ago

Liz Peek

Progressives got hammered on Election Day- but that was only the latest big defeat. What does this mean for Dems? Can Joe pivot? (spoiler-probably not)
www.foxnews.com/opinion/progressive-drubbing-biden-pivot-changing-guard-liz-peek
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Liz Peek: Progressives' drubbing opens door to (unlikely) Biden pivot, changing of the guard

They may not know it yet, but the ultra-liberal cabal that has choked Democrat politics and humiliated spineless party leaders like House Speaker Nancy Pelosi, D-Calif., has lost its mojo.

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Liz have you not heard latest on the “russia collusion” “steele dossier” Fiona Hill???
Or are you a typical msm reporter?

Liz Peek

7 months ago

Liz Peek

Joe Biden wanted to be an historic president- and he has done that. Worst ratings slide of any president since WWII.
He (or whoever is running WH) doesn’t care about voters’ top issues – instead Team Biden obsessing about climate change, gender and race.
No wonder he’s in trouble!
www.foxnews.com/opinion/biden-polls-ignoring-voter-concerns-liz-peek
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Liz Peek: Biden vs. Americans – his priorities, like climate change, ignore top worries of most voters

Voters are worried about inflation, jobs, crime, education and our open border, while the Biden White House is laser-focused on climate change, transgender rights, racism and reducing inequality.

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Climate change is important.
The GOP may not care about it now, but their children will.
He is trying to get an infrastructure bill through.
He has had issues with Afghanistan, but what else could he do
The people who are taking over Afghanistan were released by the previous administration.
I am sure that Biden is not perfect but he is better than Trump.

The great days turned to very bad days in less than a year.
Congress needs a flip to GOP next year to stop the craziness

Your bias is ridiculous. Makes you a bad writer. Btw avg teacher pay is way above 31000. Sensationalize much?

#LetsGoBrandon

Joebama

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