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Originally Posted by finnbow
Yet inflation in the US is far lower than pretty much anywhere in Europe. In other words, it's not Biden's policies causing inflation. It's pent-up demand coming out of COVID, screwed up supply chains, and increasing energy costs attributable to the Ukraine war and Biden is handling it better than pretty much anyone else.
The U.S. recently saw some good inflation news. Falling energy costs bought down inflation for the month of July, suggesting the U.S. might be past peak inflation and the Fed may dial back slightly on a massive rate hike next month.
Europe is not so lucky. A recent report from Citi has U.K. inflation hitting 18% next January. That makes the current U.S. inflation rate of just over 8% look relatively mild. In fact, last week we heard that German producer prices were up an eye-popping 37% year-on-year. Producer prices are often more volatile than consumer prices, but for Germany, it’s a worrying trend, especially as U.S. inflation may be slowing.
The OECD has a similar view with inflation in many European countries running well ahead of North America. All European nations except France and Switzerland will see higher inflation in 2022 than the U.S. based on recent OECD estimates.
As for voracious spending, this year’s deficit will decline by $1.7 trillion, representing the single largest decline in the federal deficit in American history, the Office of Management and Budget says. Despite the gains, the administration said Tuesday that it is forecasting a deficit of $1.03 trillion for the budget year that ends Sept. 30. That number signifies a movement away from the record deficit in 2020, which reached $3.13 trillion. So, Biden's deficit this year will be 67% less than Trump's was at its worst. Sounds like progress to me. |
European inflation - and Germany is an example - is going to be in large part by high energy prices. Germany getting cut off by Putin, and they have no plan B, other than a PPP-like bailout which will cost billions.
As far as a $1.3 trillion deficit sounding like "progress" to you - whilst comparing it to a 2020 budget that had the double-whammy of reduced revenue due to COVID and increased spending for the same reason - is:
1) Not really apples to apples;
2) Is still $1.3 trillion that will be added to the federal debt, and;
3) Can't really be called "progress" in this content. At best, one might say that it "sucks less".