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Contrary to what the ever-changing number of mystery Nobel laureate economists are supposedly telling President Joe Biden, inflation is getting worse, not better.
A report from the Heritage Foundation’s annual Index of Economic Freedom finds that the U.S. economy under Joe Biden has plunged to an all-time low. An all-time low.
“This year’s Index of Economic Freedom paints a disturbing picture, both at home and abroad,” Heritage President Kevin Roberts said of the report. “The decline of American economic freedom is serious cause for alarm and has real and tangible consequences for all Americans, especially low-income families and the working class.”
The report determined the U.S. fell 2.7 points from the 2021 Index of Economic Freedom to a record-low score of 72.1, and also fell to its lowest ranking globally, down from last year’s 20th spot to a ranking of 25th for 2022. Commensurately, producer prices jumped 9.7 percent in the last twelve months and increased one percent in January, according to the latest release from the Bureau of Labor Statistics.
Oof, producer price index up 1% month-on-month, 0.8% core.
Inflation getting worse not better.
— Neil Irwin (@Neil_Irwin) February 15, 2022
The Index of Economic Freedom was launched in 1995 and uses a variety of methods to evaluate countries on rule of law, government size, regulatory efficiency and open markets, while also examining specific categories such as property rights, judicial effectiveness, government integrity and tax burden.
Dovetailed into that is the Producer Price Index, which gauges the prices paid for the goods used to make final products such as metals and lumber for frames, grains for cereal, and even the glue, foil and plastics used for packaging. An increase in nearly ten percent in what it costs to make and deliver products means Americans will continue to feel the drain on their bank accounts.
U.S. Producer Price Index rose 9.7% YoY. The Core PPI which removes food and energy was up 8.3% YoY. Both reports were higher than market expectations. #inflation pic.twitter.com/SkJPyNoCsn
— Brett Crowther (@BCrowther_TDA) February 15, 2022
The average for year-over-year inflation before Biden took office was 1.5 percent. Simply put, consumers are now paying 7.5 percent more than they were last year and producers are paying 9.7 percent more to make their products.
Again, US #inflation comes in higher than median forecasts:
January producer prices rose by 1.0% MoM, twice the median projection (core was 0.8% vs 0.5%).
The annual PPI increase was 9.7% (vs 9.1% expected).
Core inflation was 6.9%.
Bottom line: More CPI inflation in the pipeline pic.twitter.com/Plmho4xpBf— Mohamed A. El-Erian (@elerianm) February 15, 2022
With inflation at a 40-year high and with the consumer price index rising 7.5 percent in January of this year compared to the same month in 2021, it’s difficult not to point to disastrous public policy decisions in the wake of the COVID-19 pandemic as a major factor.
“Since early 2020, when the Chinese Communist Party unleashed the COVID-19 pandemic on the world, we have dealt with one of the greatest political, social and economic upheavals of the past century,” Roberts said.
“The lives and livelihoods of hundreds of millions of people have been deeply disrupted, not just by the virus, but especially by draconian lockdowns, intrusive public health mandates and restrictions on commerce and trade. Trillions of dollars in new federal spending have further weakened our economy and caused a historic spike in inflation,” Roberts added.
Fox Business reported that Singapore came in the top spot among the 10 most free nations, followed by Switzerland, Ireland, New Zealand, Luxembourg, Taiwan, Estonia, Netherlands, Finland and Denmark. This year marks the first time since 2006 Australia didn’t make it on the most-free list, with Heritage pointing to the country’s “sustained severe lockdowns.”
“Most every economy included in the 2022 Index experienced negative growth in 2020, which is not surprising given that so many of the actions that governments have taken in the name of protecting public health have also reduced economic freedom,” the editors of the index wrote. “These restrictions have exacted a cost in terms of human well-being that must be added to the enormous cost of the death toll from the disease itself.”
Not surprisingly, North Korea came in as the least free nation in the world, with countries Zimbabwe, Sudan, Cuba and Venezuela also claiming spots among the top 10 least free countries list. Heritage concluded that “economic freedom remained almost nonexistent” in China.
Roberts believes the data can be considered an admonition for the U.S. to “get its fiscal house in order” and “unleash freedom.”
“We have an opportunity to speak to the very real concerns of Americans struggling in an economy where they are increasingly losing not just their freedom, but evermore of their hard-earned saving,” Roberts said. “It’s time for the U.S. government to get its fiscal house in order, unleash freedom here at home and help Americans flourish once again through self-governance.”
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Frank (Chip) Webster is a musician and composer, former teacher of percussion and U.S. Army Infantry veteran. He holds a degree in English from Arizona State University.
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