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GOP Wants to Blame Biden for Inflation. What About COVID and Capitalism?

COVID! Come on, you can say it, the monster is still under the bed, no sense pretending otherwise.

Senators John Neely Kennedy, Lisa Murkowski and John Barrasso hold their news conference in the Capitol on gas prices on May 18, 2022.

Two years ago, I was afraid of going to the grocery store, lest I encounter COVID-19 lurking by the bananas or swirling around some unmasked dunderhead coughing purposefully beneath a MAGA hat. That fear remains ever-present, alas, but has recently been joined by an aisle-by-aisle sticker shock: This costs how much, now? As the Cambridge band Morphine once warned us, it’s murder out there, murder out there, sharks patrol these waters.

The Republicans, on cue, have fanned out to all points on the compass. Their sole purpose: to blame the Biden administration for the inflation crisis that popped after the COVID stimulus packages saved the country from flying apart at the economic seams, back in the bleak times too many refuse to remember. For the Republicans, this economic crisis has arrived tied in a bright bow, just in time for the downhill run to the midterm elections in November.

I remember: Millions of people were out of work, or couldn’t work, and thanks to the magic of capitalism, most of those millions had been living paycheck to paycheck with no savings to speak of. Without the stimulus bills, and the child credit the GOP let die last summer, well … we think we live in a dystopia now. While it definitely sucks, this right here is a long, luxurious back rub compared to where we’d be without that rescue money. The post-stimulus inflation burst feels like a dirty trick, true, but it’s certainly better than the Scroogy alternative.

This is not to say the Biden administration is entirely free of culpability. Treasury Secretary Janet Yellen recently appeared with Wolf Blitzer on CNN to talk about the roiled state of the economy, and she dutifully fell upon her sword. “I think I was wrong then about the path that inflation would take,” she said. “There have been unanticipated and large shocks that have boosted energy and food prices, and supply bottlenecks that have affected our economy badly that I … at the time, didn’t fully understand.”

Fair enough. It is a deeply weird economy we’re dealing with right now. “Employers are adding hundreds of thousands of jobs a month,” reports The New York Times, “and would hire even more people if they could find them. Consumers are spending, businesses are investing, and wages are rising at their fastest pace in decades.” Yet because of inflation and the more-than-occasional dearth in necessary items (like baby formula, hey thanks, Abbott Labs), a lot of people think the economy is eating itself. Who knows, maybe it is. The old metrics no longer seem to apply.

Russia’s putrid war in Ukraine owns a substantial slice of blame for this mess, to be sure. With one fell swoop, Vladimir Putin’s invasion and the subsequent sanctions against his country kicked the struts out from under the global food and global petroleum networks. Prices for everything from grain to gasoline are spiking, causing hunger and want to increase both here and abroad.

For the lucky ones, there is the existential economic angst of paying five bucks a gallon at the gas station, only to drive to a grocery store selling ground beef for ten bucks a pound. Interesting fact: A quasi-subterranean reason why everything is so damned pricey is because diesel fuel is more expensive than gas by a notable margin. That means running the trucks that carry the food everywhere now brings a back-breaking expense to the transport companies, which they pass along to those who pass it along to those who pass it along to us.

Speaking of passing it along, no discussion of the current inflation crisis would be complete without a bright light shining on corporate price-gouging. CBS News reports:

Over the past year, despite the extreme economic upheaval of the pandemic, after-tax corporate profits have soared to record levels as a share of economic output, according to the U.S. Commerce Department…

Some corporate leaders have been blunt about their plans to pass companies’ higher supply-chain prices to consumers. For example, consumer goods giants Colgate-Palmolive, Procter & Gamble and Unilever have been able to raise prices without losing sales. Nearly two-thirds of publicly traded companies report fatter profit margins than before the pandemic, according to the Wall Street Journal.

Russia-gas-food, Russia-gas-food… flip on the news networks and you’ll hear about this unholy trinity until your flatscreen cracks, but there has been a hole in the reporting wider than Jupiter, one that the Biden administration has also comprehensively failed to mention enough: COVID.

COVID! Come on, you can say it, the monster is still under the bed, no sense pretending otherwise. COVID fouled global supply lines way back in 2020 and they have not recovered, so that’s nothing new. When we reached that first lull in infections, and then when we reached another one after the spike that inevitably comes when we let down our guard, people went wild with their spending. Steak at a restaurant! Whiskey at a bar! Music at a concert! Stuff! Things! PUT THAT SHIT IN MY FACE, and it felt like life again, because around here, it was.

Increased demand + lowered supply (due to COVID-caused shipping ills) is How To Have Inflation 101, basic stuff. People ran out and giddily cleared the shelves, and not nearly enough ships came in to restock them. Compounding this, COVID has all but shuttered China, which is the manufacturing hub of the world whether we like it or not. Empty factories don’t feed empty ships, which leads to empty stores on the other side of the ocean and people faced with spending way more than they’re used to for basic needs.

This doesn’t look like it will change anytime soon. “After months of rolling lockdowns in scores of Chinese cities that have forced hundreds of millions of people to remain in their homes, it is clear that President Xi Jinping is prepared to pursue his policy of zero-Covid at the expense of all other concerns,” reports The Financial Times. “That includes the widespread damage the policy is wreaking on the world’s second-biggest economy and most important manufacturing engine, and the political risks it is creating by further limiting the freedom of 1.4bn people.”

When I step back, I can’t help but be amazed at how much effort is going into keeping COVID out of the inflation conversation, even as it shuts down massive nations like China and still fouls the global supply lines. The Financial Times covers it because they really kind of have to, but the others? It’s all Russia’s fault, no it’s all Biden’s fault, no it was the free money you guys!

It was, is, and will remain COVID, which turned the whole damned planet on its ear, killed a million people here, and is not nearly finished with us. Capitalism, of course, helps not at all. There may very well be a way out of this without confronting an economic cataclysm, but when all is said and done, complaints about the price of gasoline and ground chuck could be remembered as the good old days. We need to be honest with ourselves about why.

Sharks patrol these waters. Don’t forget it.

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