Treasury Secretary Janet Yellen told Fox Business Network this week that she regrets using the word “transitory” to describe the post-Covid pandemic inflation, framing it as a good-faith prediction gone wrong. This is revisionist history.
It is clear that Yellen participated in a concerted political effort to dismiss the growing concerns about spiking pricing because Democrats were trying to ram through a massive, cronyist, welfare-state boondoggle using reconciliation. Her rhetoric mirrored that of the entire White House. Yellen didn’t misjudge anything; she followed a script. (Though it is a possibility she actually wrote it.) The entire White House was mobilized to repeat the lie.
“There’s nobody suggesting there’s unchecked inflation on the way — no serious economist,” Biden famously claimed. Former White House Press Secretary Jen Psaki added that “no economist” predicted higher inflation, even as numerous respected economists, including well-known Democrats, warned that injecting trillions into a hot economy would exacerbate inflation. Psaki made that claim in November 2021. In October 2021, inflation rose at its fastest rate since 1990.
When asked about the dire predictions of economists, Yellen said, “I really don’t think that is going to happen. We had a 3.5% unemployment rate before the pandemic and there was no sign of inflation increasing.” That was on March 8, 2021. On March 1, 2021, The Wall Street Journal reported that “anxiety about inflation is at a fever pitch, among economists and in markets, where long-term interest rates have been grinding higher since President Biden unveiled plans for huge new fiscal stimulus.”
Just a reminder: Yellen was previously chair of the Federal Reserve, tasked with the dual mandate of achieving maximum employment and keeping inflation stable. She must have been terrible at her job.
While inflation is a complex, multifaceted, global issue, it is also true that the Biden administration officials acted as wrong as anyone could, considering the facts. They ignored it. They lied about it. They exacerbated it.
By the time Yellen was dismissing price spikes, Democrats had already thrown $2 trillion in “stimulus” into the economy and continued expanding the terms of unemployment benefits (even as the job market was heating up). All of this after the $3 trillion bipartisan “Covid relief” bill had passed. With an assist from a handful of Republicans, Democrats passed another infrastructure bill that cost more than $1 trillion.
Remember, as well, that if Republicans — with the help of two “moderate” Democrats — had not stopped Biden, Yellen, and the Democrats, the original “Build Back Better” bill would have cost nearly twice as much as the final product. One very confident left-wing econ writer, noting that Biden had “tossed the playbook,” called this a new kind of “bold and aggressive program of Keynesian economic management.”
Indeed.
Democrats didn’t care. Because they believed that they needed to pass a massive spending bill before the 2022 midterms. But ad prices spiked to 40-year highs — what Biden’s right-hand man Ron Klain called “high class problems”— and poll numbers dropped, Biden officials began cynically using the rising prices as a justification for more spending.
Biden’s National Economic Council Director Brian Deese actually argued that “Build Back Better” — which, you might recall, our genius president says cost “zero” dollars — would help combat inflation. And then Democrats just renamed an inflation-driving bill the “Inflation Reduction Act”— because they think you’re stupid.
After its passage, the left credited the Inflation Reduction Act with fixing an array of imagined problems. Still, inflation took off, as many (allegedly non-existent) economists had predicted.
“I wish I hadn’t called it that because it has less to do with reducing inflation than it has to do with providing alternatives that generate economic growth,” was one of the nonsensical things Biden said about the bill. The cost of the Inflation Reduction Act, incidentally, continues to spike.
Even today, like an arsonist at the fire, Yellen makes the evidence-free claim that the slight cooling of inflation can be attributed to the Inflation Reduction Act’s “energy saving measures.”
Biden, you will recall, signed a slew of executive orders pausing government leases on public lands, shutting down construction of the Keystone XL Pipeline, and limiting drilling in the Gulf of Mexico over imaginary “social cost of carbon” externalities. Despite the (extra) uncertainty that came with a post-pandemic economy, all of these “energy-saving measures” were done in the first weeks of the Biden administration.
Yellen can claim to be regretful because there is no price to pay. All of this is reminiscent of the 2012 episode when the entire Democratic Party mocked Mitt Romney for calling Russia a top geopolitical threat. Recall that it was around this time Biden was leading the “reset,” and Obama gave Putin whatever he asked. It was only in 2016, when it was politically expedient to pretend that Russia was stealing our democracy for Donald Trump, that Democrats apologized to Romney.
They do this all the time. Yellen isn’t fooling anyone.
