Liberal talking mouths like Paul Krugman at the New York Times may be trying to defend the Biden administration by denying the rapidly approaching inflation wave.
But new data released by the Department of Labor Tuesday suggests that wave is already here.
What are the details?
Last month, consumer prices rose by .9% from May, the fastest pace since 2008, yet another signal that inflation is here and hurting the purchasing power of each dollar in your pocket.
The Associated Press reported:
Tuesday's report from the Labor Department showed that consumer prices in June rose 0.9% from May and 5.4% over the past year — the sharpest 12-month inflation spike since August 2008. Excluding volatile oil and gas prices, so-called core inflation rose 4.5% in the past year, the largest increase since November 1991.
The report is so bad, in fact, that experts had been anticipating a .5% price increase only — nearly half of what actually happened, Fox Business noted.
Over the last year, prices have spiked across the board. The year-over-year price increase of car rentals, for example, is nearly 90%, while the prices of gas, airfare, hotels, food, and other consumer goods also have risen considerably.
Here are the items really driving up inflation: Car rental 87.7% (y/y change) Used cars 45.2% Gas 45.1% Laundry ma… https://t.co/LtRhnonpVi— Heather Long (@Heather Long)1626180480.0
To make matters worse, real earnings, which are adjusted for inflation, dropped in June — and are down more than 1% from last year.
"Real average hourly earnings decreased 0.5%, with real average weekly earnings decreasing 0.9% from May to June. Compared to June 2020, real average hourly earnings and weekly earnings dropped 1.7% and 1.4%, respectively," Marketrama reported.
What is causing the inflation?
Behind the inflation are several factors: Supply chain congestion, labor shortage, and "largely transitory factors" the Federal Reserve says are related to the economic recovery from the COVID-19 pandemic, the Wall Street Journal reported.
Larry Summers, the former treasury secretary under Bill Clinton and director of the National Economic Council under Barack Obama, also said President Joe Biden's policies and stimulus, which pumped massive amounts of money into the economy quickly, may be causing the economy to "overheat." That's because, as Summers recently explained, Biden is treating the economy today as if America were still at the height of the pandemic.
At any rate, top economists are warning Americans to brace themselves for several years of higher-than-normal inflation at rates not seen since the early 1990s.
"Inflation is expected to surge longer and longer — longer than the Fed previously thought," Diane Swonk, chief economist at Grant Thornton, told the Wall Street Journal.
Economist Stephen Moore said, "Inflation is real and it is getting worse, not better. The Fed is behind the curve in controlling price rises and Biden is adding gas to the fires of inflation with his trillions of dollars of debt spending and 'free' money."
Still, Federal Reserve Chairman Jerome Powell has insisted the inflation is only temporary, but has not said when the Federal Reserve expects the economy to cool down.