“The same thing happens in blogging. Failure defeats losers, failure inspires winners
“It was the Fed that primarily dropped the ball on addressing inflation in 2021,' writes CLeonardNews, “missing the opportunity to act quickly and effectively.”
The Fed continues to evade accountability for inflation.
And while the Fed is a prime driver of this year’s volatility, the central bank continues to evade public accountability for it.
Just last month, for instance, the Senate confirmed Mr. Powell to serve another four-year term as Fed chairman. The vote – more than four to one in favor – reflects the amazingly high level of bipartisan support that Mr. Powell enjoys. The president, at a White House meeting in May, presented Mr. Powell as an ally in the fight against inflation rather than the culprit for much of this year’s financial market volatility. “My plan is to address inflation. It starts with a simple proposition: Respect the Fed and respect the Fed’s independence, ”the president said.
This leaves the field open for the Republican Party to pin the blame for Wall Street’s woes on the Democratic Party’s inaction. As Jim Jordan, the Republican congressman from Ohio, phrased it on Twitter recently, “Your 401k misses President Trump.” This almost certainly presages a Republican line of attack over the summer and fall. It will not matter that this rhetoric is the opposite of Mr. Trump’s back in 2018 and 2019, when the Fed was tightening and causing markets to teeter. Back then, Mr. Trump attacked Mr. Powell on Twitter and pressured the Fed chairman to cut interest rates even though the economy was growing. (The Fed complied in the summer of 2019.) But things are different now. Mr. Biden is in office, and the Fed’s tightening paves a clear pathway for the Republican Party to claim majorities in the House and Senate.
Republicans have also honed in on Mr. Biden’s $ 1.9 trillion American Rescue Plan, intended to mitigate the impact of the Covid-19 pandemic, as a cause of runaway inflation. Treasury Secretary Janet Yellen rejected that, noting in testimony before members of Congress: “We’re seeing high inflation in almost all of the developed countries around the world. And they have very different fiscal policies. So it can not be the case that the bulk of the inflation that we’re experiencing reflects the impact ”of the American Rescue Plan.
Democrats would be wise to point to the source of the problem: a decade of easy money policies at the Fed, not from anything done at the White House or in Congress over the past year and a half.
The real tragedy is that this fall’s election might reinforce the very dynamics that created the problem in the first place. During the 2010s, Congress fell into a state of dysfunction and paralysis at the very moment when its economic policymaking power was needed most. It should be viewed as no coincidence that the Fed announced that it would intensify its experiments in quantitative easing on Nov. 3, 2010, the day after members of the Tea Party movement were swept into power in the House. The Fed was seen as the only federal agency equipped to forcefully drive economic growth as Congress relegated itself to the sidelines.
With prices for gas, food and other goods still on the rise and the stock market in a state of flux, there may still be considerable pain ahead for consumers. But Americans should not fall for simplistic rhetoric that blames this all on Mr. Biden. More than a decade of monetary policy brought us to this moment, not 17 months of Democratic control in Washington. Voters should be clear-eyed about the cause of this economic chaos, and vote for the party they think can best lead us out of it.
To put it simply, the Feds created years of super-easy money, with short term interest rates held near zero while it pumped trillions of dollars into the banking system. One way to understand the scape of these programs Is to measure the size of the Fed's balance sheet. The balance sheet was about $900 billion in mid-2008, before the financial market crash. It rose to $4.5 trillion in 2015 and is just short of $9 trillion today.
Opinion | If You Must Point Fingers on Inflation, Here’s Where to Point Them
Law360, This Change Could Ease Filing Burden, Retiring Tax Prof. Says
Joshua D. Blank (UC-Irvine; Google Scholar), Presidential Tax Transparency, 40 Yale L. & Pol'y Rev. 1 (2021):
Whether the public should have access to the tax returns of the President of the United States, and those who seek the office, is the focus of acute attention and debate. President Donald Trump’s refusal to disclose his tax returns throughout his campaigns and presidency has fueled multiple legislative public disclosure proposals. In March 2021, the U.S. House of Representatives passed legislation as part of the For the People Act of 2021 that would require Presidents,
Calling Bullshit The Art Of Skepticism In A Data Driven World with Carl Bergstrom and Jevin West (video) Center for Inquiry
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New York Times, The Global Minimum Tax Deal Is In Trouble:
What economists hailed as the most ambitious tax overhaul in a century is now mired in a toxic mix of fine print and political paralysis.
It was only last fall that more than 130 nations signed on to an agreement to eliminate the world’s tax havens and enact a global minimum tax. The agreement was designed to increase taxes substantially on many large corporations and to end an international fight over how technology companies are taxed. Its architects said it would end the global “race to the bottom” for corporate tax rates.
Jeremy Bearer-Friend (George Washington; Google Scholar), Tax Without Cash, 106 Minn. L. Rev. 953 (2021)
Don’t Call It Belly Dancing Evergreen
