Quit crying just because it’s stupid and stand tall instead. Don’t apologize or tell the world you’re taking a look at yourself. You didn’t get destroyed in 2024; you barely lost. Just shut up and move on. Never go around saying your re-evaluating yourself, it shows weakness. Plus, it’s just stupid. This is war with a dictator wannabe and the extreme right. WWII was a fight against the extreme right.
Don’t forget this: In 2013, ex-Senator Bob Dole said this about the Republicans:
“I think they ought to put a sign on the [Republican] national committee doors that says closed for repairs…”
And now look where they are. They might be ruling from the gutter, but they are running the country (barely, with about 51% of elected support).
Democrats can come back-if Trump doesn’t destroy the country first-but if Republicans (what I call The Trump Party) can recover from that low in 2013, then Dems can come back. (Of course, Dole did support Trump in 2016, so who knows.)
The Mistakes Democrats Made in 2016 and 2024
Democrats have made several mistakes in the last 10 years that cost them elections. And they weren’t on policy; They were mistakes with candidates:
THE BIGGEST MISTAKE OF ALL – NUMBER 1. They nominated Hilary Clinton to run for President in 2016. Not that Hilary wouldn’t make a good President, but she couldn’t win. I mean: Who wants the same couple in the White House when the candidate is the spouse of a former President? Nothing against the Clintons, but I don’t care who it is; I don’t want the same people in there again because it’s now the spouse who’s running. It has absolutely nothing to do with the Clintons. Believe me when I say that. I JUST DON’T WANT THE SPOUSE OF THE SAME #!*!ING COUPLE AGAIN, WHOEVER THEY ARE. GOT IT!? End of discussion.
Trump barely won in 2016 and even lost the popular vote. Somebody as good, or even much worse, than Hillary could have won and beaten Trump. But again: PEOPLE DON’T WANT THE SPOUSE OF A PREVIOUS PRESIDENT AGAIN IN THE WHITE HOUSE. GOT IT NOW?
NUMBER 2 MISTAKE: #1 and #2 above 10 times over. That’s why the Dems lost in 2016. Their own stupidity.
The next step was the 2020 election. The Democrats won because Biden was a return to sanity. Dems were back on top. But what did I think at the time? Biden was 78 years old when he became President. Even when he was running, i.e., before he won the election, I knew that he should only run for one term. He would be too old to run for a second term. That would be stupid.
NUMBER 3 MISTAKE. Democrats nominated Biden to run again in 2024. How stupid is that? What was the number one complaint voters had about the two candidates? They were both too old. If they had nominated Harris to run in 2024 after she campaigned for a couple of years before she was nominated, she would be President now and we wouldn’t be in this #!*!ING mess with a conman as President. Harris destroyed Trump in the one debate held in 2024. If she had been in the race back in 2021 or even earlier, there would have been at least one more debate and she would have again destroyed Trump, and he would have lost the election. She is quick on her feet, and Trump’s stupidity would have been showing.
NUMBER 4 MISTAKE. Democrats are “examining” themselves wondering why they lost. Trump won 49.9% of the vote in 2024. That’s the same as one vote if there had been only 100 voters. He barely sneaked over the line. And the Dems are questioning why they lost? They barely lost. And they’re crying in their beer as to why? Meanwhile, Trump goes around claiming he has this big mandate, yet the Dems never speak up and remind him – and the country – that no, he has no mandate, he barely won. And the Republicans barely won the Senate and the House. That is no mandate. Why aren’t the Dems constantly challenging that claim every single time he makes it? Is that stupid or what?
That’s why they lost in 2016 and in 2024.
AND THEN THERE’S THIS
Trump really started running for President when he led the Obama “birther movement” back in 2011. When he finally got the nomination in 2016, people were still asking him: “Do you believe Obama was born in the U.S.?” He answered yes, Obama was born in the U.S.
But how did the Democrats respond to that? They took it as a dead issue and never mentioned it again, when they should have said that his admittance about Obama’s birthplace was not the issue. THE ISSUE WAS THAT HE KNEW ALL ALONG THAT OBAMA WAS BORN IN THE U.S.; He just made the claim to get support from millions of Obama-haters. He never sent any investigators to Hawaii or Africa. That was another lie. And the Dems probably would have won if they had pushed that back then, but they just accepted it like it was Trump admitting that yes, he did steal a cookie off someone’s plate – like it was no big deal. Well, it was a big deal. Trump won that issue and the Dems didn’t even notice.
So, they lost.
This is not a battle between Democrats & Republicans; It’s a battle between those who see Trump is a conman and those who can’t see he is a conman.
President Biden came into office in January 2021. Inflation started to rise two months later and continued to rise to exceedingly high levels in 2022. Trump, who was planning to run for re-election in 2024, immediately blamed Biden for the inflation. Did Biden do something in the first two months of his administration to cause inflation? Is that even possible? What caused the dramatic rise in inflation? And was inflation the real problem that people confronted—or was it the cost of living, meaning that people’s income didn’t rise to meet the inflation?
Let’s be clear, there is almost nothing any President can do to cause inflation, or to stop inflation after only two months in office. Policy changes take many months, sometimes years, to affect the largest economy in the world.
“Almost” nothing? Well, there are exceptions. Policy changes are on thing, but drastic actions can be devastating. After all, you could take the best, most expensive, and modern car that takes years of planning and development—and destroy it in seconds. Just drive it over a cliff and watch. It’s the same with a society. Unconventional actions that destroy segments of normal society that took years, decades, and even centuries to build could cause unforeseen consequences that are unpredictable. But Biden took no drastic or unconventional actions in his first two months in office. He moved slowly and deliberately as his administration developed over his first six months, and then his first year. Trump blamed Biden for the inflation, but he never said what Biden did to cause it. He just repeated the accusation over and over—and people believed him.
Political observers like to say that when things go bad during a President’s term in office, it’s the President’s fault, but they only say that if their current party is out of power. And, of course, when their party is in power, they blame the previous President.
So, what did cause the inflation? Or—was inflation the real problem that caused so many people to complain about it?
The Real Problem with High Inflation is When Wages Don’t Rise to Meet It
Inflation’s real problem is about the cost of living and how wealthy you are. Inflation is no problem if your income goes up to balance it out. And the wealthier you are, the less it matters.
Take millionaires, multimillionaires, and billionaires. When the price of groceries increases, their lifestyles are not affected. Everyone in the top 10% of wealth distribution—who control 70% of America’s wealth—do not feel any changes in their lifestyle when the price of groceries goes up, for example.
On the other hand, if you are at the bottom of the income scale, or even at the middle-income level, groceries can be a major part of your necessary expenses. The more money you have, the less important groceries are to your budget.
It’s the cost of living that really matters. If there is inflation and wages go up to compensate for it, the higher prices are not felt in the middle and lower classes—and people accept it.
Every 15-20 years, prices go up 30 to 40 percent in a healthy, thriving economy and people accept that as normal. But inflation usually happens a little each year—and people don’t feel it very much. But when prices and wages stagnate for most of that period and then suddenly prices go up in a year or two, people feel the pain, and the bottom and middle classes feel it the most.
But—what is a “healthy, thriving economy”?
Real wage growth, which represents the middle and the lower class, has grown only 32% from 1990-2018, but national income grew 109%. So where did that money go? To the top 10% more than any other group. The top 10% control 70% of the nation’s wealth. The top 10% feel basically nothing in their lifestyles when there is inflation. They increased their income during the Great Recession, after the Great Recession and during the Pandemic. Trump reduced their taxes in 2017 which helped their earnings during the Pandemic.
Can Inflation Be Good?
Economists believe that some inflation around a 2% annual average is healthy as it means the economy is growing. If it goes up one month to 2.5%—or even 3%—economists don’t think that’s bad, but they start to examine the causes to see if it’s an anomaly—or the beginning of a trend. And if it suddenly goes down one month, it could lead to deflation (when inflation is below zero). They keep an eye on that for the same reasons: Is it a trend or an exception? *
Some people say that inflation is caused by national debt, which is now at record levels. As a general statement, they are wrong. That can happen, but if that were true in all cases, then every time the debt went up, inflation would follow. But history proves that’s not always the case. One example alone disproves this theory. After WWII, when the national debt in the U.S. was the highest it has ever been when measured against the country’s total wealth (including our present era), the economy boomed for the next three decades. Not only that, after the war, with GIs returning to the workforce, demand for everything was extremely high. And high demand can be a major factor in inflation. But there was no major inflation right after the war or in the following decades. The 1960s was the largest boom in American history. And taxes after the war, and up through the 60s, were at the highest level in history, especially for the wealthy. These high taxes also brought on balanced budgets.
Another more recent example is what happened since the Iraq/Afghanistan wars. Military spending went up starting with the invasion of Afghanistan in 2002, followed by the invasion of Iraq in 2003. War costs went into the billions. Taxes were lowered just prior to the war, and the national debt skyrocketed, yet there was no high inflation from the start of the wars up until 2021, although the national debt from 2003 up until 2000 went up dramatically by trillions.
National debt can definitely contribute to inflation, but to say it is the cause of inflation is naïve, even ignorant—or maybe some people just want to believe that that is the cause, so they push that statement.
Rise in debt was substantial as the national debt increased from early 2000s through 2015 during the Iraq and Afghanistan wars, along with the effects on government revenue from the 2008 Great Recession. Debt increased drastically, but there was no inflation outside the norm from the beginning of the war through 2020. Inflation came later, right after the Pandemic in 2020. Inflation increased for three reasons: Economic recovery bringing a massive rise in demand; Extremely low demand from the Pandemic; Low interest rates during and right after the pandemic.
Major debt like we have now is not good, but it’s not just a spending issue. It’s an income issue as well. And almost all income comes from taxes. President Eisenhauer, when he was in office in the 1950s, always resisted lowering taxes, saying the national debt would go up. In 1960, income over $200,000 was taxed at 91%. (That $200,000 would be worth $2 million in today’s dollars, meaning income over that amount would be taxed at 91%.)
What can happen quickly is economic crashes. They can happen almost immediately. It’s like a car. It takes a lot of planning and work to design and build a great car, but it can all be destroyed in an accident in seconds. But car accidents also have causes. A crash is what happened over a noticeably short period of time in 2008 when the “Great Recession” came about. But its causes go back many years.
How Much Do Prices Naturally Increase Over Time in a Healthy Economy?
Another crucial factor in dealing with inflation is how much inflation rises over time in a healthy economy. With a healthy 2% inflation rate per year, that means that over a 14-year period, inflation would cause prices to rise at least 28% (2% times 14), but the inflation rate would be compounding. Consequently, there would be approximately a 30% increase in prices. Let’s take a look at how prices changed from the Great Recession prices in 2008 up through the high-inflation year of 2022, a 14-year period.
In late 2008, the “Great Recession” started. That year, inflation started to drop drastically in November and December and continued to stay low for the next 10 years until it climbed slowly upward until 2022—14-years later—when it had a dramatic rise. The average annual inflation rate during those 14 years was very low at 2.25%. In 2022, the last year of that 14-year period, the average inflation was 8%. That’s quite an increase in one year when you consider that annual healthy inflation should be around 2%. But overall, an average of 2.25% per year is very low. Even if it had been 3% average per year, that would not be alarming.
“Average inflation 2008-2022 was low, but it all hit in one year”
Another way to look at it is that prices at the end of 2022 were pretty much where they would have been if there had been no Great Recession and no Pandemic—and the economy was healthy and growing during that period—with inflation occurring at a normal, healthy annual rate—instead of happening all in one year, which is what happened in 2022. In other words, inflation was not a big deal when you look at the long-term average. In fact, that 14-year rate was one of the lowest inflation rates experienced over a similar amount of time in the previous 50 years.
“The real problem with inflation is when wages don’t go up”
But in 2022, people complained about the inflation in the cost of basics, especially for necessary products like food. But if the average rate was normal over 14 years, why would people complain? For a very simple reason: It was because the cost of living went up drastically. Wages and employment were stagnant and very low during that 14-year period. Many lost their jobs and couldn’t find work. It was labeled the “Great Recession” for a reason. Consequently, the pain for the average wage earner when inflation went up was quite high—and it happened all at once. In other words, inflation was not the problem. It was that the cost of living went up considerably and wages did not rise to meet the rise in prices.
Whose Policies Caused High Inflation in 2022?
Trump blamed Biden, but it’s more than likely that the inflation was caused over a period of several years before Biden became President. Trump was President for the four years before Biden. After all, there is no policy that any President could implement to cause inflation after only two months in office—even if they tried to make that happen.
If Biden caused it, Trump never gave reasons why he believed Biden caused the inflation in two months. He just blamed Biden and kept blaming him for the next four years. Trump was like a broken record. After a while, people believe it. But blaming someone is meaningless without naming the cause, although it got Trump re-elected in 2024 because he repeated the accusation over and over for four years—and Biden and the Democrats never fought back.
“People just believed that since the inflation happened when Biden was President, it must be his fault”
Just because people believed Trump’s accusations doesn’t mean he was right. We will learn below that he was wrong. Besides, as mentioned above, inflation wasn’t the big problem; It was the increased cost of living for most Americans—and of course that always affects the middle and lower classes the most.
And if Trump caused the inflation just two months after he left office, then what did he do during his four years that could have caused it?
Trump had other reasons for blaming Biden. He was running for re-election in 2024. Of course he wanted to blame Biden, who beat him in 2020.
The Seeds of Inflation Were Planted Years Earlier
In reality, the seeds of the high inflation in 2021-22 were planted years before—in 2008. That was the year that the “Great Recession” was “born” (although it was developing in the American economic “womb” for many years prior to that).
When Obama took office in January 2009, he inherited an economy in deep trouble. It was named the “Great Recession” because it was the biggest economic downturn since the Great Depression in the 1930s. Over the next eight years, under the Obama administration, the economy slowly, but surely, grew and came back. It’s like putting the car back together after an accident destroyed it. It’s a slow process—and you can’t just go out and buy a new economy.
By the time Trump took office in 2017, all economic indicators showed a healthy economy solidly on the road of recovery; Employment was coming back, along with the stock market. Inflation was exceptionally low during the previous nine years, even dipping into negative inflation, i.e., deflation, in 2009 and again in 2015.
As the economy improved, interest rates were raised—before Trump took office. The economy was doing well enough that Federal Reserve Chairwoman Yellen raised the rate in 2015 for the first time since 2008—in anticipation of a probable rise in inflation if they weren’t raised. The economy was doing that well.
Raising the interest rate in a recovery is done for only one reason: to stave off inflation during an economic recovery. It is done gradually so that there is no massive and sudden decrease in spending because the cost of money increased—which could cause the country to slip back into a recession. Yellen also indicated that she would continue to raise the rate in the coming years, and it was raised regularly over the next three years, reaching 2.4% by early 2019. But in 2018, President Trump appointed a new chairperson, Jerome Powell.
A New Fed Chairperson Comes to Office in 2018
Powell first indicated he would continue to raise the rates that Yellen started. But Trump did not want to. In fact, Trump wanted them lowered and—against the advice of many economists—he urged Powell to lower the interest rate, which he did three times—something that is never done when an economy is growing because of the probability of increasing inflation. Interest rates are the main tool that economists use to control inflation. But Trump had an election coming up and was afraid of an economic downturn in the fourth year of his Presidency if interest rates went up, or even just stayed where they were.
The President does not control the Fed rate. The Fed chairperson leads a board of governors who make the final decision, but the chairperson has the most power, and his term lasts four years, but it does not coincide with the President’s four years in office. It is intended to be independent so that the rate is non-political. But President Trump put pressure on Powell to lower the rates. Consequently, due to his urging, Powell lowered the rates in 2019† and were down to 1.5% by early 2020 (when the Pandemic started). The Fed looks at long-term trends. Trump was looking at the short-term effect on his re-election.
When Trump took office, he claimed he inherited an economy in 2017 that was a “mess.” But in reality, all indicators showed a strong stock market, growing employment and steady economic improvement when he took office. Trump knew it, but he wanted to take the credit for its revival since it was already happening. It was classic “Trump speak.” Consequently, he called it a “mess” shortly after his inauguration in 2017. After all, he was already thinking about his re-election.
But he was wrong. The “mess” was in 2008. The economy in 2016 was solidly on the road of recovery and was doing well.
Trump Economic Policy 2017-2019
In the first three years during Trump’s administration, the economy continued to improve with low inflation—all because of a decade of sound economic policies instituted before Trump.
Trump only made two major economic policy changes during those first three years (his fourth year was the pandemic year). First, in 2017, he lowered taxes for the wealthy, which increased the national debt substantially over the coming years. Trump claimed that he lowered the taxes for the middle and lower classes, but it was so small that it was Trump’s gesture to them, because most of the tax reduction went to the wealthy, which included Trump himself, along with his family.
But a big problem was that unemployment, which had gone down in recent years, was still above ideal and wages for the middle and lower classes were stagnant in most of the years since the Great Recession. And who cares about reducing your income taxes when you are unemployed?
Who cares about tax reductions if you are unemployed?
Regardless, the tax reduction for the rich was another input into the economy of cash that would add fuel to the fire of inflation right after Trump left office in January 2020. Tax deductions are always an input of cash, delivered and processed in the hands of the wealthy. And they always take time to make their way into the economy because taxes are always paid a year or more in the future after they become law.
Interest Rates Under President Trump
Trump’s second major economic change was to persuade Powell— against the advice of almost all economists— to lower the interest rates after they were recently raised. Lowering interest rates is an economic tool that is used to help jump-start when the economy goes into a recession. The country at that point was coming out of a recession and in such good shape that interest rates had been lowered before Trump became President. The economy was already improving and far along the road of recovery from the Great Recession. Raising rates during a recovery is done to stop possible inflation. Trump did the opposite—because he was afraid of not getting re-elected.
The Great Recession reached it’s climax in late 2008. Interest rates were somewhat high just beforehand, but were dropped drastically in 2009, then were raised in 2016 as the economy recovered. They were then lowered in 2019, then dropped to a very low level in 2020 because of the Pandemic. By the end of the year, the Pandemic was over and rates were raised as demand came back all at once in 2021-2022. Inflation soared.
Then, in 2020, during Trump’s fourth year as President—and when he was running for re-election—the global Covid Pandemic hit. Employment went down rapidly. Everyone went home, some working from home, others just not working at all. Businesses closed. Airlines and other sectors slowed down drastically. In March 2020, stock markets around the world crashed. By the end of the first quarter, the U.S. and the world were in a recession because of the Pandemic.
Countries around the world announced stimulus programs to increase government spending and lessen the possibility of a world-wide recession—or even worse, a depression.
The U.S. Pandemic Stimulus in 2020 Changes Everything
The Democrats and the Republicans in Congress, along with President Trump, all wanted to create a federal economic stimulus to help people get through the downturn in business and employment—and prevent a deep recession. The stimulus was also intended to put the economy in a strong position to come back when the Pandemic was over—because everyone believed it would be over before the end of the year, and they wanted to be ready for a strong comeback. Plus, it was an election year and Trump knew a stimulus package would help his re-election. He promoted a big stimulus.
The stimulus was massive. The first major bill was a $2.2 trillion stimulus package passed in March. Along with other stimulus bills, including those that were instituted in the following months, the total amount reached about $5 trillion that went out to individuals and businesses. Both parties in Congress, as well as President Trump, supported it—otherwise it would not have happened. The country had gone into a recession because of the Pandemic, although it was in the final stages of a recovery from the Great Recession. But because of the stimulus, the Pandemic recession was not extreme.
A $5 Trillion Stimulus
It’s hard to compute how effective the stimulus was and in what areas, but it was a $5 trillion input from the Federal Government—a very big chunk of money. There has never been a stimulus that big. It was unprecedented, as was the way it was put into the economy. In order for the stimulus to have an immediate effect, most of the money was sent out directly to the people as checks (many were direct deposits to individual bank accounts), extended unemployment benefits and direct payments to businesses—including small businesses as well as large corporations.
People did not spend it all at once, and many bought items online to be delivered to homes through Amazon and other outlets. These businesses benefited from the Pandemic. Plus, a large part of the stimulus went to major corporations in certain sectors, like the airlines. In fact, all indicators show the rich got richer during this time—along with their tax reduction in 2017. The stimulus was also intended to help individuals as well as businesses—both large and small—to have money to restart the economy after the Pandemic ended.
By the end of the second quarter of 2020, the Pandemic recession was basically over. It was the shortest recession in American history for two reasons. First, because of the stimulus, And second, because the economy had basically recovered from the Great Recession before the Pandemic. That recovery just went on “pause” when the Pandemic hit. But the U.S. economy did not immediately jump into an economic boom. It was gradual. Spending that massive $5 trillion was not immediate, and it took a while before it spread through the recovering economy. Plus, people were cautious. Many just saved their money. It took months before spending went up substantially as the money entered the economy. But you can’t just restart the largest economy in the world overnight.
Although inflation was at a healthy rate around 2% before the Pandemic, by the end of 2020, it had dropped down to a 1.2 % average for the year—basically because of the Pandemic “recession” and the slow recovery in the second half of the year.
Interest Rates and the Pandemic Recession Stimulus
Biden was elected President in November 2020. With the Pandemic basically over, and much of the stimulus money still in people’s pockets, spending slowly increased. Inflation started to creep up with spending, and just two months after Biden took office in January 2021, inflation increased and reached 4.2% in April. * It continued to rise, reaching its biggest increase in 2022. Most economists wondered if this would happen because the stimulus was massive, and there was nothing anyone could do to stop the $5 trillion from being used up. But it was uncharted territory as no Pandemic had ever hit the country as heavily as the Covid Pandemic did.
When the Pandemic suddenly hit in early 2020, the bottom dropped out of the economy. Demand dropped like a rock falling off a high cliff into a deep canyon below. Inflation hit a low of 0.1% in May of 2020—barely above deflation. Powell had lowered the interest rate in February, then again in March and again in April—down to .05%. This continued the trend of lowering the interest rate that Trump wanted in 2019. But it was also lowered because of the Pandemic and economists were delving in unknown territory. This set the stage to help cause the high inflation that would start in April 2021.
Starting in April 2021, when inflation jumped to 4.2%, the Fed rate was at .05% and was kept low, first reaching .07% and then .08% where it stayed until the end of the year. Powell started to raise it in early 2022. By the end of 2021, inflation had continued to rise as people returned to work and started spending as the $5 trillion in stimulus continued to enter the economy that was in full swing. It was like throwing gasoline on the fire of inflation—a disaster waiting to happen. The spending increased through 2022 and beyond—and inflation, although brought under control by raising the Fed interest rate, continued at a lower rate in the following years. †
What is the Best Policy on Interest Rates During a Pandemic?
The Pandemic recession was somewhat unprecedented and how to respond to it was in question. Do you lower interest rates for a Pandemic recession? That would be standard in a “normal” recession. But the Federal Reserve, along with economists, were uncertain if that was the correct policy during a Pandemic recession. Why? Because they knew the Pandemic would end in the coming months and the economy was already strong, having recovered from the Great Recession over the previous 12 years. But still—it was uncharted territory, and all bets were off on what to do and what would happen next.
In looking back, many economists agree that it was a mistake to lower them, since everyone knew the Pandemic and the effects of its recession would be over by the end of the year. But it was an election year and Trump was afraid the recession would go deeper, and he would lose the election. Consequently, he pressured Powell to lower the rates.
Unfortunately, the lower rates helped fuel the upcoming inflation—regardless of who was the next President. Inflation was at an extremely low 0.1% in May 2020. When the Pandemic finally ends, plus the $5 trillion stimulus, and considering the strength of the economy before the Pandemic, inflation was going to skyrocket when it was over. It was actually predictable. But then again—no one had a lot of experience with Pandemics in the modern era and many economists were unsure. In fact, they had no experience.
Next, after months of distributing the stimulus money, came the effects of the massive $5 trillion stimulus, which kept the country from falling even deeper into a recession. But everyone knew the Pandemic would end—and by the end of 2020, it was basically over, and the effects of the $5 trillion stimulus began as spending increased. Businesses re-opened—or came out of their slump—people went back to work, and everyone started spending money like it was going out of style.
Biden Becomes President
Two months after Biden became President in January 2021, demand went straight up quickly from a deep valley of low demand—all causing an incredible rise in prices of everything. Inflation went from 0.1% in May 2020 to 4.2% in April 2021, and then to 5% in May. That was a substantial increase over only two months.
There was nothing that Trump nor Biden could have done to cause it—or to stop it. It was a massive freight train coming down the tracks that was unstoppable. The economy was not only recovering from the Great Recession when inflation was near zero, but from a year of an economic slump caused by the 2020 Pandemic, which put the recovery in “pause” mode.
2021 was followed by a steep rise in inflation in 2022. Donald Trump consistently blamed President Biden for the rise of inflation that started shortly after Biden became President in 2021. Trump constantly blamed him for four years—all the way through the 2024 election (and after). Trump continued to claim that there was no inflation when he was President, and it all started because of Biden’s policies. Trump’s followers believed him, and still do, and that belief was a major factor in Trump’s win in the 2024 election—if not the major factor.
The big question is: Is Trump correct? Did Biden really cause the steep rise in inflation only two months after he took office? If so, then what policies did he enact that caused it?
Or did Trump’s policies during the previous year, and earlier, cause the inflation? And if so, then what policies did he enact that caused it?
What Really Caused the Inflation When Biden was President?
Here are the main causes of the steep inflation which started in April 2021. It’s important to keep in mind that inflation is good if it is generally around 2% a year. At 2% a year, it will rise about 30% every 14 years. In reality, since inflation happens every year, it will hurt the most if your income doesn’t go up with inflation, meaning that the cost of living is what’s important. Income from the lower and middle classes was stagnant, and unemployment was high, from the Great Recession in 2008 through 2022. The wealthy got wealthier during that period. That is the essence of the problem.
In chronological Order:
The Great Recession in 2008. There is no doubt that if the 2008 recession had never occurred, it is most likely that the high inflation in 2022 would not have happened—even with the Pandemic of 2020. But then again, without that recession, the Presidential and Congressional elections over 14 years might have had different outcomes. But the real pain during the 14-year interval was the cost of living to the middle and lower classes, and if the economy had not fallen into a deep recession, wages would have risen to some extent, although wages for the lower and middle classes have not increased substantially since the 1980s. One cannot say exactly what would have happened, but the Great Recession definitely had a major affect that contributed to high inflation.
Lowering taxes in 2017. The economic effects of the 2008 Great Recession were slowly healing and on a good course when Trump took office in 2017. His economic policies were centered around lowering taxes for the rich, which caused the national debt to rise substantially. Compared to the wealthy, middle and lower-income Americans received a pittance in tax reduction. And who cares about a tax reduction when you are unemployed? Did the tax reduction input enough money into the economy three years after it was enacted so that it increased demand enough to cause inflation? Not on its own, but any input of money into the economy increases spending—and consequently, inflation.
Lowering the interest rate in 2019. Trump did not support increasing interest rates when he should have in his first three years. Even though interest rates were increased in 2015 through 2017 because the economy was deeply into the recovery from the Great Depression, Trump opposed raising the rates when Fed Chairperson Powell indicated in 2018 that they should be raised. He urged Powell to lower them, which he did. All economic indicators pointed to raising them, but Trump was concern about his re-election, so Powell lowered them. Even leaving them where they were would have been a better choice. Not raising the rates definitely contributed to the inflation that was still to come. The lowered rates meant that mortgage rates would be low, but with low employment and then the Pandemic, few houses were being built between 2008 through 2020. This drove housing prices up because the population increased and housing didn’t. ††
The Pandemic and the stimulus in 2020. The Pandemic stimulus was the largest cause of the rise in inflation in 2021-2022. And it was supported by President Trump, the Democrats in Congress, and the Republicans in Congress. Without the support of all three, it would never have passed. $5 Trillion is a large amount of money and there was no stopping its effects once the money was put out there. It was a freight train crash waiting to happen—a perfect storm of inflation.
In Conclusion: Who and What Caused the Inflation?
Trump blamed Biden for the inflation, but Trump played a key role in it, and if one person is to take most of the blame, it is undoubtedly Trump—because he was President for four years right up to two months before the rising inflation began. He did have help, though, because both the Republicans and the Democrats in Congress were the ones who got the stimulus passed. And Biden supported that stimulus before the 2020 election, but he had no official role in it. Then-President Trump strongly supported it because he was thinking about his re-election.
Of course, if there had never been the Great Recession which caused the biggest economic crash since the Great Depression, the massive inflation could have still happened, but as outlined above, the inflation from 2008 to 2022 averaged out to be low over those 14 years. If there had been no steep recession in 2008, it is more than likely that wages/income for the middle and lower classes would have risen, and the cost of living would not have gone up. But then again, the cost of living for the middle and lower classes has not kept up with inflation for the previous 40 years.
And, of course, the Pandemic and particularly the resulting stimulus, caused the inflation to hit all at once, which was the real problem. It should have been spread out over several years and distributed in a different fashion throughout the economy.
But then again, the country had never experienced a Pandemic in modern times, and no one was sure how to manage it.
No one act caused the steep inflation in 2022, but a combination of many factors. It was a “Perfect Storm” of many causes.
“The top 1% owned a record 32.3% of the nation’s wealth as of the end of 2021, data show. The share of wealth held by the bottom 90% of Americans, likewise, has declined slightly since before the pandemic, from 30.5% to 30.2%.” ‡
The Real Problem with the Inflation in 2022 was Low Wages
No one would be complaining if wages had risen in 2008-2022 to meet the cost of inflation. As outlined above, over that 14-year period, average prices rose at a normal healthy rate, but wages were stagnant along with many years of low employment. The average inflation rate was normal over the 14 years. But when inflation got so low that there were periods of deflation, it was like prices dropped into a deep canyon for many years and then when the economy returned—not only from 12 years of recovering from the Great Recession, but also from one year of recovering from the Pandemic—prices climbed out of that deep canyon all at once in a little over one year.
The real pain is always felt by the middle- and lower-income classes and wages have not kept up with inflation for many decades—going back to the 1980s. The problem since the Great Recession in 2008 through 2022 was that it all came to a head in one year—2022.
The rich didn’t mind. They got wealthier when most of the country was suffering losses through higher prices with no rise in wages. The top 10% control 70 percent of America’s wealth and that situation is getting worse.
But there was one other problem: If the rich got richer during that time, where did the money come from? Simple, the national debt went from $10 trillion in 2008 to $33 trillion in 2023. The money came from the federal government and it went into the pockets of the top 10%. Five trillion dollars in pandemic debt alone was enough to explain why the rich got richer during not only the Great Recession, but also during the Pandemic and the high inflation that followed it.
NOTES
* The monthly inflation rate is often misunderstood by many in the general public. If inflation rises 5% one month and then 6% the next month, that doesn’t mean that prices went up 5% the first month and then they rose 6% higher the next month. It means that in the first month, prices were 5% higher than the same month of the previous year, and the following month the prices were 6% higher than the same month the previous year. Over 12 months, the average is taken and that is the annual rate of inflation, meaning how much higher prices were compared to the previous year. For example, if inflation went up 5% every month in a year, then the average inflation that year was 5% that year compared to the same average inflation the previous year.
† Fed Chairperson Powell later admitted to making a mistake by lowering rates in 2019, stating that the economy was in better shape than expected. The Pandemic recession was short-lived, and the higher rates would have helped keep inflation in check—inflation that was still to come.
† † Housing. The biggest increase in the cost of living resulting from the Great Recession combined with the Pandemic was with the cost of housing. The Great Recession was caused by inflated housing prices before 2008 when there were cheap and easily obtained mortgages. This led to overbuilding because inflated home appraisals were given out like candy. After 2008, housing starts almost stopped completely. Housing prices dropped for years afterwards, since there was an over supply caused by easy mortgages before 2008. Housing is often an indicator of economies coming back from economic slumps. Plus, they are an early, but subtle, indicator of economies heading for a crash. Housing starts rarely move quickly because land development, design and construction is a slow process. This is especially true if a subdivision needs to be developed, as they take an extremely long time. Housing started to pick up in 2017 (the most housing starts since 2007) and continued to slowly increase until the Pandemic hit, when starts again almost came to a complete halt. Housing continued to increase, but raising the interest rates caused it to slow down because of mortgage costs. Housing prices remained high through 2024 but are slowly leveling off in late 2024 as mortgage rates creep down.
Note: This article was edited only in that I changed the word “Will Say to Congress” to “Said to Congress” and added the words: “is What I Predicted” to the title. That’s because I was right. (The original title was: “What Trump Will Say in His Speech to Congress and Why“.) Otherwise, nothing has changed in the text below.
I read articles this morning, and in the last few days, about what Trump is going to say in his speech to Congress today. I wish people would quit rationalizing what Trump says as though he is a rational person. I know exactly what he’s going to say and do.
First of all, he’s going to lie constantly, then he’s going to brag about how great he is and how he’s solving every problem that exists, and then he’s going to use what he used for the last 10 years, and probably all his life—and which also got him elected with cult-like support: he’s going to continue to blame everyone else and tell the world how they are the enemy.
He started his entire presidential campaign on one thing: he announced a group to hate and then he united his supporters behind him in hating them. That group was immigrants, mainly those who come across our southern border, but also those who come from “shithole countries” (in Trump’s own words.). Of course, he will mention that group. And then he’s going to add the other groups that he’s added to it for the last 10 years, which is Democrats, communists, socialist, minorities, government workers—the list goes on and on.
All you have to do is go on TwitterX and see how his supporters constantly, over and over, have united behind Trump in hating all these groups. It’s one of the oldest tricks in the political playbook of history. Find a group to hate and unite the people behind you in hating them. The best examples in modern times: Hitler and Mussolini and the Jewish people. Hitler added the Russians in there when he invaded Russia. Mussolini added the Arabs in there when he invaded Libya.
That’s what Trump has done since he announced his Presidential candidacy in 2015. Of course, he started earlier when he accused Obama of not being born in the U.S. And that was a few years before his Presidential announcement in 2015. Obama and all of his supporters were another group to hate. He still reinvigorates this hate today when he talks about Obama.
So please, everyone, quit rationalizing what he’s going to say, because the one thing that always happens without fail is that all of his supporters believe everything he says as absolute truth and that’s what matters to him; that they hear it.
Several years ago, I read a Letter to the Editor in the St. Petersburg Times (now called the Tampa Bay Times). I copied the letter and saved it in my computer, forgetting about it until I accidentally ran across it recently. As I reread the letter, I realized that the writer (whose name I am keeping private to protect the innocent*) was possibly correct.
The letter was about Rick Scott, who had recently been elected Governor of Florida in 2011. He started his own healthcare company many years earlier and had become quite wealthy. He was ousted as CEO after his company was convicted of Medicare fraud. The company had to pay the largest fine in Medicare history. Part of the settlement was that he no longer be CEO of his own company. He was not personally convicted. He also walked away with $200 million dollars. He then went into politics as a Republican. During his years as Governor, he heavily promoted business interests and was opposed to any free healthcare. He was against the Obama Affordable Care Act. After two terms as Florida’s governor, he successfully ran for the Senate, where he resides today. He has always voted with his fellow Republicans every time they tried to get rid of the Affordable Care Act.
Here is the text of the Letter to the Editor about Scott:
Some people have joked that Governor Rick Scott, based on his appearance, is an alien. I think he might be a Ferangi. This species from Star Trek has no motivation beyond business. Their religion is business, and their god is profit.
Their culture and philosophy are defined by the rules of acquisition. These rules make no provision for supporting the common good, or those less fortunate. A Ferangi doesn’t hesitate to cheat, lie, or steal to complete a business deal. He will betray his family and allies for profit. The only dishonor a Ferangi knows is to fail to get the advantage in a business deal. They regard other species as inferior, and their females have no power or rights.
The reason this letter seems appropriate today is because I am convinced that both Donald Trump and Elon Musk—just to name a few—are most likely all Farangis. People might say that Star Trek is a fictitious TV series, but there are many who believe that it was a documentary. It takes place around the year 2150 and maybe time travel was possible. After all, the current Republican Party supports both Trump and Musk, and they act like they are all cut from the same Ferangi cloth—or at the very least they bow down to it.
*****
* If the letter writer wishes to contact me for any reason, please do so at: editor@accidentalplanet.com . I kept the name of the writer and you can identify yourself by giving me that name and the municipality you noted in the letter signifying where you were from, so that I have the correct person.
In 1966, I joined a fraternity during my first year at the University of California (Berkeley). My brother was in the fraternity, and it seemed like the logical thing to do. Fraternity members were known as “Greeks.” And we were all “brothers.” I knew nothing about anything that first year.
After you “pledge” to join the fraternity, you then, after a few months (either one quarter or one semester) of being in this lowly class, you go through “Hell Week” where you and your fellow pledges have to pass through all sorts of weird tests and physical feats. Afterwards, if you managed to survive the week, you become a “brother.” The below event occurred shortly after we became “brothers.” It was the winter quarter—the second quarter of our first academic year.
One thing we Greek brothers liked to do was have a good time, and if this meant creating misery for some poor unknown soul who happened to be in the way, well—so be it.
Our fraternity house was three floors tall, and above the highest floor was a stairway to a flat roof, which turned out to be a very convenient place to drink beer, listen to music, and generally cavort about while shouting insults to those who happen to have the bad fortune to walk by on the sidewalk in front of the house at the time. It was three stories lower than us and was also far enough away to save our ass if someone didn’t quite take it in good humor.
One sunny afternoon, after our studying and classes had ended, three of us were sitting on this roof doing exactly what I have just described, that is, behaving like young pranksters and looking for something to do. My good friend John, who always seemed like the truly serious beer drinker of the group, had the good idea to get some water balloons and start tossing them at the brothers who came home from class, or whatever they were doing, while we were on the roof enjoying ourselves.
The first one who came by, the one known in the house as “Fox”—who was much older than us first-year brothers—had the misfortune of being our first target. Of course, water balloons aren’t really a dangerous flying object, but up three floors they can surely be something to reckon with. We hid behind the wall parapet as he approached the house from the street, carrying his books and wearing the appropriate Greek attire of levis, white shirt and “penny loafers.”
When he came into range, we all three stood up and lobbed as many balloons as we could grab in his direction, which must have been, if I can remember correctly, at least eight or ten of those suckers. They all came crashing down around him in a great volley like huge raindrops, not one of which, thank God, was a direct hit. Nevertheless, we managed to totally soak his shiny penny loafers and his levis from the knees down. Of course, he also managed to drop all his books and papers, which, by the way, ended up being in a scattered mess stretching all around him, as he came to an abrupt halt in shock. As he looked up at us, we ducked behind the parapet wall in hopes of not being caught in this dastardly act, although we all knew that it would be easy for him to discover who the guilty ones really were.
We also knew—especially because we were now true brothers, all three of us, and no longer merely pledges—that a good prank was actually well-respected among the Greeks and that our stature among the others would actually improve, barring any really unfortunate consequences. In other words, a good prank, without really hurting anyone, was deserving of great admiration.
As we stuck our heads over the wall to look back down, hoping not to be to be noticed, we heard the slamming of the front door and knew that “Fox” was well on his way to running up the stairs, in hopes of catching us in the act which was just described. We noticed, as we looked down at the wet sidewalk where our weapons had made contact, that his papers and books were still scattered about. He obviously must have been so pissed that he left the whole mess in a rage and was on his way to give us a raft of real shit.
We three, laughing hysterically of course, looked at each other with a slight amount of terror, quickly jumped into our lounge chairs, picked up our beers in one hand, and in the other hand quickly grabbed and opened our textbooks, which, by the way, were actually there for studying, as all these rooftop gatherings began when one brother decided he would wander up there and study in the sunshine, and as soon as two more would join him, with the same scholarly intention, there would be three of us, and that constituted grounds for a party.
Meanwhile, “Fox” was madly running up the stairway to admonish us for soaking his penny loafers, and we knew that any second the door would slam open, and he would be standing there yelling at us, and that’s exactly what happened, except, by the time he did so, we were calmly reading our books as though we had no idea of what he was talking about.
“Okay, who are the assholes who think this is funny?” He looked at us, obviously quite perturbed, and for a moment there, as we looked up, we thought maybe we had gone a little too far, but, as we saw him standing there, completely soaked from the knees down, we all, trying to maintain straight faces, broke out in uncontrollable laughter. This, by good luck, prompted “Fox” to do the same, and we all, especially us three villains, began to roll on the ground in merriment.
“Fox” forgave us for any ill we caused him, but he did make us help pick up his books and papers, and I swear that he treated us with a little more respect after that, but not from fear, but from the knowledge that he now knew we were capable of serious prankstering. One thing I did notice changed in him, and that was that every time he walked up the sidewalk to the front door he stopped, momentarily, almost unconsciously, and looked up. This even happened when I was walking right next to him.
Trump pardoned the January 6 insurrectionists to justify his accusation that there was cheating in the 2020 election—and that he was the real winner. He knew that if he did so it would back up his claim, because if there really was cheating then those people would just be rebelling against the fake election results, and it was justified. By pardoning them, he reinforces his lie to not only them, but to all his supporters who put him in office – and it makes him look like he is innocent.
Trump does not care if they are innocent or guilty. He only cares if he looks innocent or guilty. But Trump has another motive by pardoning them: He has gained their undying loyalty, and they know that if they support him with violence again, he will again pardon them. After all, what would they have to lose? They have now become his Presidential Guard. His private army. The current Republican Party, or should I say Trump Party, and its leaders, are cheering him on, and the few Republicans who hold any power who don’t agree with these pardons will continue to support Trump in silence. They are that fearful. They are cowering in silence.
After freeing those who were violent in the Capitol on Jan. 6, does Trump now have his own private “Presidential Guard” who will be violent for him if he needs them?
Of course if we want to keep it simple, Trump pardoned them because he’s just a lying human being who has no morals, principles, or shame. He only wants power. He is a legend in his own mind.
In his inauguration speech, he actually claimed that God saved him so he could save the country. That is the final proof that he has a god complex and really is mentally sick.
His supporters believe every word he says as absolute truth without question, just like the people who followed Hitler, Mussolini—and other despots and dictators throughout history. Weak people need leaders like Trump, strong people don’t. And Trump knows his people are weak and will follow him anywhere. They never question him or seek the truth beyond what he says. Most of what he has said publicly and politically ever since he led the Obama birther movement in 2011 were said for only one reason: Because his followers believe everything he says. Whether it’s true or not does not matter; What’s important is that his followers hear it.
During my over 50 years of being an employer and an employee in the American economy, there is one type of personality that I ran into all the time. And that is someone who’s new to a company who comes in with the idea that they are going to change and fix everything. They are generally pretty young, but always have this feeling that they are superior to others. The other employees who see this new person realize that he’s just another jerk who thinks that they are all inefficient and worthless employees and this guy’s going to fix it.
I was even one of those in my early days until I realized that I’m not superior to these others, and I can’t go in and fix everything because I learned over time that certain practices and habits are there for a reason, and those reasons have often come down over decades and centuries. What I learned was called humility.
Humility is something that Elon Musk needs badly. His money has gone to his head and now he has a God complex. He’s like Trump, who also has a God complex. Trump also thinks that he’s going to come in and fix everything in the world—and that he is superior to everyone else—that only he can fix it.
Someone needs to tell Elon—and Trump, for that matter—that efficiency is not the goal of everything. In fact, efficiency can almost be the bane of human existence.
Efficiency is Not the Main Goal in Life
And this thing with DEI. We need to have a society that’s diverse, equitable and inclusive of all types of people. DEI hiring is often bringing in people who live on the fringes of society because the majority of society, or maybe a large group, doesn’t like them, often because these people are of a different race, religion, sex—or have some other unpopular trait. In other words, they’re prejudiced against them, and they don’t want to deal with them, so these people just fall by the wayside because society doesn’t engage with them. And engagement means that they aren’t as efficient. But efficiency, again, is not the main goal in life, nor should it be in government and society.
What good government and a good society should be has yet to be determined; It’s a work in progress, although there are a lot of people who are convinced that they know exactly what it should be and they want to force that on everyone else—except the idea of democracy, which is only defined as rule by the people—and is also a work in progress—stands in their way.
Elon should understand all this. After all, he grew up in South Africa, a place where the majority of the people who were black were once ruled by the minority of the people, who were white. And the white people weren’t kind to the black people. The white people just didn’t like the black people. They thought they were superior to the blacks. Democracy came along and changed all that. And that is still a work in progress. But Elon, who is white, left. Maybe it wasn’t efficient enough for him.
Democracy in the dictionary is defined as “rule by the people”
In the early days of human evolution, after our ancestors came out of the trees and started walking upright on the ground, there was a discussion among the different parts of the body about who was going to be boss.
First, the brain spoke up and said, “I have all the knowledge, the foresight and all information from all the body parts come to me. I should be the boss.”
Second, the legs spoke and said, “I take us everywhere we go and without me, we couldn’t move around and get food and water. I should be the boss.”
Then the stomach spoke up and said, “I digest all the food that gives us energy to live, move around and do everything. I should be the boss.”
Next, the eyes spoke and said, “I can see everything that goes on and we would just be bumbling around in the dark if it weren’t for me. I should be the boss.”
Then the asshole spoke. “Without me, we would get all stopped up and our legs would wobble, the brain would have a headache, the eyes would be cloudy, and the stomach would be backed up, unable to eat. I should be the boss.”
All the other body parts laughed and joked about how stupid that would be.
So, the asshole decided to show them. It went on strike and didn’t let anything out. The other parts of the body broke down and nothing could get down, so they all got together and decided to make the asshole the boss.
It just goes to show you, that you don’t have to have brains to be the boss; Just be an asshole.
And that’s how just a few people, sometimes even just one person , can control an institution like the U.S. Congress and the House of Representatives.
Although Inflation was high in 2022, the average annual rate from 2009 through October 2022, was one of the lowest in the last 50 years.
In 2022, inflation in the U.S. has hit highs not seen in decades, but how bad is it really and what caused it?
If we look at total inflation in the last two decades, it tells a different story. Looking at the average rate of Inflation over this period, it has been at a normal healthy pace over the long run—and that includes the high rates in 2022. The problem is that there was very low inflation for more than 10 years previously, and then we get very high inflation all at once in 2022. When “normal” inflation is spread out over several years, people don’t feel it as much as when it builds up and hits everyone over a one-year period, like in 2022. But overall, prices in 2022 are about where they would be if we had steady inflation little by little over this period. Hard to believe, but that’s what the facts show.
Inflation rates by decade, showing some of the lowest rates on record from 2000-2019. Although not shown, the average inflation rate from 2010 through October 2022 is 2.5%.
Because of two major events since 2008, inflation has set records of prolonged periods of very low inflation, then, starting in 2021, the country experienced mild inflation, building up to high inflation in 2022. We can show this as we look back, but first: Is inflation good for the economy, and if so, how much inflation is good and how much is bad?
Is Inflation Good or is it All Bad?
Economists generally agree that a little inflation is necessary for a growing and healthy economy, so the government plans for some inflation. The Federal Reserve bank, the nation’s central bank, has set an annual target of 2% inflation, allowing it to periodically go a bit higher—up to around 3%. When it goes above 3% for a month or two and then drops down, there is little concern, but when it keeps climbing, everyone is concerned.
In the first 10 months of 2022, inflation hit a high of 9.1% and a low of 7.5%, with an average of about 8.3%. But if we average the inflation rate over the previous 10 years, going back to 2013, the rate averages out at 2.5% a year. * This is within the parameters that the Federal Reserve considers comfortable for stable economic growth. Part of the problem is that “stable economic growth” rarely happens for long periods. Growth has always come with downturns and upturns. Adding in unrelated crises, like wars and pandemics, which happen periodically, makes for even less predictable outcomes.
If we go back even further, to 2009, the average inflation rate changes even more. At the end of 2008, there was a major economic collapse—often called “The Great Recession.” But its major effect began a few months later in early 2009. When there is a collapse of the economy, demand drops when people lose their jobs and cut back on their buying. Consequently, inflation is low. There was even deflation in 2009 with a -0.4% inflationary average over the entire year. Subsequently, as the economy recovered and demand increased, Inflation slowly went back up until 2020, when the pandemic hit, which had a major economic impact that no one was certain about. Inflation dropped back down to 1.2% and then, in 2021, as the nation recovered from the pandemic, the rate began to rise until it hit the highs in 2022. In other words, the country experienced very low inflation from 2008 through 2020.
The Great Recession, the Pandemic and the Inflation Rate
These two major events, the Great Recession and the pandemic, instigated significant economic changes that caused inflation to fall and then rise again. But the effects from each event were vastly different and we can learn a lot by comparing the two, especially the inflation rates.
The Great Recession was a deep, but normal, recession with unemployment going up, profits dropping and inflation slowing down below the normal healthy inflation rate levels of around 2%. In the first year, 2009, inflation hit a low of -0.4%. The following year (2010) inflation began to rise, but it was still low at 1.6%. In 2011, as the economy began to recover, it hit 3.2%, then in 2012 it was 2.1% as the recovery grew stronger. Then it hit low inflationary rates in the following years of 1.5% (2013), 1.6% (2014), 0.1% (2015), 1.3% (2016), 2.1% (2017), 2.4% (2018), 1.8% (2019). These are typical of previous recession recoveries. The average of the years 2009 through 2019 was very low at 1.6%—below the average of 2% that the central bank sees as healthy. You might call the recovery from the Great Recession a normal “healthy” recovery that was just like other recoveries, except it was from a deeper and more severe recession than any seen since the Depression in the 30s.
Inflation by month and by year for 2000-2022.
The second big event, the pandemic, hit starting in the second quarter of 2020. Average annual inflation that year was at a very low 1.2%. It had not dropped that low since 2015. The pandemic caused a recession, but it was like no recession that anyone had ever seen before, and its effects were unpredictable. There had not been a pandemic in the U.S. in more than 100 years—and never in a modern economy. It was uncharted territory. The economy had just gone through a recovery over the previous eight years and was in a very strong and healthy condition. The pandemic recession was not linked to the normal business cycle, though. Many lost their jobs—even though demand was there—and small and medium-sized businesses closed down, some permanently, some temporarily. Many started working from home, and many just quit working. Unemployment went up. But the government gave out money and extended unemployment benefits to help those in trouble. That put some money into the economy. But the future was still uncertain.
The Pandemic “Recession”
No one was sure what the economy would do or how the government should respond. The economy had never gone through anything like it. In fact, it was hard to call it a recession since people weren’t really being laid off like in a normal recession. Many people were being temporarily laid off “until the pandemic ended.” During the height of the pandemic, many took early retirement and early Social Security benefits. Many started working for themselves and many joined the cash economy, getting unreported income. Crime went up as society was disrupted, plus crime always goes up when people lose their jobs. The poor suffered most, which always happens during rising unemployment. But generally, people had less money and demand was low, which means inflation would be low.
One could say that the pandemic, with layoffs and businesses closing or cutting back, caused a recession. It was like a recession, but it did not have the usual causes. Plus, it had one other unique aspect: It was the fastest recession recovery in history. The pandemic hit the economy in early 2020, then it basically ended in late 2020, and everyone went back to work, and it was basically over by early 2021—all in one year.
As people went back to work, demand increased and inflation went up, hitting 4.7% in 2021. This happened not only in the U.S. but around the world. The pandemic and its associated “recession” caused factories to close or cut back around the world. Before the pandemic, the world’s economy had become more international than ever before. Products were manufactured overseas and then shipped to consumers around the world. When product demand came back, it was difficult for supply lines to come back quickly. The overseas factories and supply lines to bring goods to America, mainly in Asia, grew “organically” and very slowly over several decades going back to the 70s. When demand came back in America, it came back quickly, but these supply lines to overseas factories had to be restarted. It was like rebuilding a car that was taken apart and put in storage.
With those two events, the Great Recession and the pandemic, the U.S. had record inflationary lows for many years and then record highs in 2022. But the average from the beginning of 2009 through 2022 was still low at 2.25%, which is as good as it gets for a long-term low inflation rate. If we look at inflation by decade, 2.25% over 14 years is exceptionally low. In the attached graph, inflation in the 2000s was 2.54%, in the 1990s it was at 3.08%, and in the 1980s it was at 5.82%. It’s just that the high inflation mid 2021 through 2022 hit all at once and was not spread out over several years. In other words, the prices in 2022 are pretty much what they would have been if the average inflation rate had increased at a relatively low and steady pace over this period. It just hurts more when it comes all at once.
Low Unemployment and Inflation Rate Average
The state of the economy post pandemic from 2021-2022 was a surprise to most everyone, and the biggest surprise was very low unemployment with two jobs for every person looking for a job. Companies, large and small, were struggling to find enough workers. And demand was booming as the economy’s recovery from the pandemic “recession” went into overdrive.
Economists, who mainly did not predict this situation when the pandemic ended in 2020, started to talk about a recession in 2022, even some saying we were already in one. Then came predictions about a coming recession later in 2022. Then it became 2023, then it was mid-2023, and then it was late 2023. And many predict the worst recession of all time.
What is the main problem with a recession? It’s simple: People lose their jobs. For those who have been saying that we are already in a recession are missing this key ingredient: There’s never been a recession with unemployment this low. Economics is not an exact science and considering the failure of at least 90 percent of economists to predict the Great Recession, I wonder about their opinions today. Maybe they are all trying to make up for not seeing the 2008 crash. But then again, even though economics is not an exact science, these “respected economists” talk like it is. Or maybe they’ve learned their lesson from 2008 and are better economists (I hope so). It reminds me of the old saying: Get five economists together and you get six opinions on where the economy is going. Add an unknown factor like a pandemic and you would probably get 10 opinions.
Inflation’s ups and downs from 2012-2021. Although 2022 inflation is not shown here, if we include the inflation rate through October 2022, this period is one of the lowest average annual inflation rates in the last 50 years. The Federal Reserve’s goal is around 2% inflation.
The other big result of the pandemic “recession” recovery was increase demand, which always causes inflation, or at the least, fears of inflation. In 2021, inflation immediately began to rise in the second quarter of 2021, with an average annual rate of 4.7%. In 2022, inflation increased very quickly. Wages were rising, but not fast enough to keep consumers happy. The “recovery” was going too fast, and with the low inflation for the previous 14 years, inflation was catching up all at once—in one year.
So… what can be done about it?
Rising and Falling Interest Rates’ Effects on the Inflation Rate
The main tool that the government has in controlling inflation is the Federal Funds Rate, which sets the interest rate for borrowing. The Funds Rate is set by the Federal Reserve (the “Fed”), and the one person who has the most power for setting the rate is the chairperson of the Federal Reserve. The theory on controlling inflation: In a strong economy, when demand is high, inflation goes up, therefore increase interest rates to slow down the economy and soften demand. In a weakening economy, when demand is low and inflation too low, lower interest rates to spur the economy and keep inflation rates at a healthy 2%. In a recovering economy, with low inflation, raise interest rates incrementally to stave off inflation. Interest rates that are too low for too long create a situation where there is too much easy money in the economy and inflation will go up. And in the long run, being able to borrow money at a very low cost is not a good thing, so bringing rates up to a “reasonable” level is a good thing.
Funds rates 2012 through October 2022. Although the rate was on a slow but steady gradual increase starting in 2015, the rate trend did not continue, but was lowered in 2019, although the economy was doing well as it recovered from the Great Recession.
By the time the Great Recession started in late 2008, the interest rate had dropped steadily from 5.25% in 2007 to around 2% in the third quarter of 2008. The economy started to show signs of weakness in 2007, so the Fed started a regular lowering of the Funds rate to encourage borrowing and investment. By August 2008, it was at 2%. By September, when the crash really came to a head, the rate was dropped to around 1% and by early December it was at .15%. It stayed in that range for the next seven years and the economy continued to recover and grow until the Fed, under Chairwoman Janet Yellen, started to raise the rate in December 2015 when the economy was doing fairly well. Then the rate was slowly but steadily raised over the next three years by Yellen and by the new Fed Chair, Jerome Powell who was appointed by President Trump in early 2018. It reached a low rate of 2.4% by the first quarter of 2019, when Powell indicated the Fed would continue to raise rates. Instead of raising them—and in response to pressure from President Trump—he made no rate change. And then he lowered the rate three times in the third and fourth quarter of 2019, again under pressure from President Trump, even though the economy was continuing to grow. Why the Fed agreed, or succumbed to Trump’s desire, to not only raise rates, but to lower them, was surprising to many, considering that the economy was still doing well. In fact, Fed Chairman Powell later admitted to making a mistake by lowering rates, stating that the economy was in better shape than expected. Lowering the rates was a big mistake, the effects of which would be felt much later.
In late 2019 and early 2020, inflation was below the 2% target. This was before the pandemic caused economic problems. Raising rates would have been the correct thing to do to keep the economy from overheating and causing rising inflation. Instead, only a few months later in the spring of 2020 when the effects of the pandemic took hold, demand fell, and inflation stayed very low the rest of the year. If, instead of lowering rates in 2019, the Fed had continued to raise them, or even just stabilize it, inflation would have been kept in check when the pandemic ended just months later in late 2020 and everyone went back to work. Instead, inflation started to rise in March 2021 and continued a steady increase until it started to increase very quickly in the second quarter of 2021 (going over 5%). This was another time to raise rates incrementally, but that didn’t happen. As it continued into 2022, the Fed woke up and finally started to raise rates monthly to stave off the extreme inflation through 2022. It was too late to ease the pain of low but steady inflation.
But the average annual inflation from 2009 through 2022 was, as noted above, only 2.25%—a very healthy rate over the long run. Rates should never have been lowered in 2019. The Fed should have continued to raise them instead, which is what they were doing in the years leading up to 2019. These were not big jumps, but incrementally small ones of only around .5% a year on average. The rates should have been left alone at around 1.5% in early 2020. Lowering the rate to less than 1% resulted in very low inflation in 2019-2020 and very high inflation in 2021 and 2022. The Fed didn’t follow its own historical guidelines of raising rates in good times to control future inflation.
Consequently, 2022 hit consumers all at once instead of slowly over the years. Again, at only 2.25% average per year, prices in late 2022 are about the same as they would have been anyway. But no one thinks of it like that. Why? Because Trump and Powell are to blame for lowering the rate in 2019, and Biden and Powell are to blame for not raising them in 2021, although that was too late to make a major impact right away. One thing about inflation: it takes time for changes in the Fed rate to affect a massive economy like the U.S., meaning many months to years. Politically speaking, everyone is looking for someone to blame, but no one wants to take the blame.
The Perfect Storm of Inflation
In conclusion, it was good that the economy had low borrowing rates during the pandemic, which was at its worst from the spring of 2020 until late that year. There was no reason to raise them; businesses weren’t borrowing during that time anyway. They were saving money, as were consumers, who experienced record savings rates, which was later money spent in 2021-2022, which helped fuel inflation. But it would have been best to not lower the rate in early 2020, when it was lowered substantially. It was down to 0.5% by April from 1.5% only 4 months earlier. Rates should probably not have been raised during that period but should have been in 2019. They should have at least stabilized the rates in 2020, not lowered them.
High inflation in 2022 was caused by the pandemic more than any single factor, and the pandemic was an event never experienced in over a century—and not at all in the modern world of an international economy. The country, and the world, will continue to feel the effects of the pandemic for years to come, so beware of those who are so certain in their predictions of total collapse in the coming year. Anything could happen, including total economic expansion and prosperity, short-term recession, long-term recession—or even another pandemic. After all, we are in uncharted territory. At the pace the world is changing—even without the pandemic—we will stay in uncharted territory for a very long time, perhaps forever, because it is the incredibly fast pace of technological improvements that is the main driving factor in the modern world—and the slow pace of human evolution that is trying to deal with it that will determine our future. That clash makes the future exceedingly difficult to predict, and a pandemic makes that even more difficult.
The pandemic might have been the most important single factor in the rise in inflation, but it wasn’t the only factor. There were three factors that created the perfect storm of inflation in 2021-2022: First was not continuing to raise rates in 2019, but instead lowering them and doing so again in early 2020. These decisions were not economic decisions, but political decisions. Second was the pandemic. And third was not incrementally raising them again starting in late 2020 and on into 2021, although it might have been too late, anyway. But it couldn’t have hurt the situation. Instead, the rates had to catch up with the economy all at once in 2022. The perfect storm. And no one saw it coming.
Inflation will slow down on its own, mainly because it has caught up with itself.
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* Many people don’t understand the monthly inflation reports. It’s important to know that when the inflation rate is 5% one month and then 6% the next month, that doesn’t mean that prices went up 5% the first month and then they rose 6% higher the next month. It means that in the first month, prices were 5% higher than the same month of the previous year, and the following month the prices were 6% higher than the same month the previous year. Over 12 months, the average is taken and that is the annual rate of how much inflation there was over the previous year.
Trump at a Rally. He loves to be the center of attention, surrounded by his Fifth-Avenue voters, who he called “his people”
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Donald Trump has a following of die-hard, cult-like followers who will support him no matter what he says and does. He called them out in January 2016, in Sioux Center, Iowa. when he stated:
“You know what else they say about my people? The polls, they say I have the most loyal people. Did you ever see that? Where I could stand in the middle of Fifth Avenue and shoot somebody and I wouldn’t lose any voters, okay? It’s like incredible.”
The audience laughed, even though he had just insulted them by suggesting that they are blind, unthinking sheep who will follow him no matter what. They didn’t care—and they knew it was true, anyway. Essentially, Trump was right; His followers to this day have followed him—like blind, unthinking sheep who will follow him no matter what—the “fifth-avenue voters.”
The monthly inflation rate is often misunderstood by many in the general public. If inflation rises 5% one month and then 6% the next month, that doesn’t mean that prices went up 5% the first month and then they rose 6% higher the next month. It means that in the first month, prices were 5% higher than the same month of the previous year, and the following month the prices were 6% higher than the same month the previous year. Over 12 months, the average is taken and that is the annual rate of inflation, meaning how much higher prices were compared to the previous year. For example, if inflation went up 5% every month in a year, then the average inflation that year was 5% that year compared to the same average inflation the previous year.
According to the Center for Disease Control, during 2017, approximately one third (82 million) of U.S. adults reported having hypertension, and an estimated three quarters of those with hypertension (62 million) reported using antihypertensive medication.
I am not a doctor, and this article does not pretend to offer medical advice, but information.
After my experience with sloppy blood-pressure-measuring procedures in a medical office that led a doctor to telling me that I had high blood pressure, when I didn’t, I decided to research correct procedures and share my experience with others.
It is strongly recommended that readers do their own research to learn for themselves. To help in researching, I have placed many links in this article (and at the end of the article) about proper procedures that are not only recommended by individual doctors, but are also recommended by the medical community, which is trying to get the word out to doctors about poor practices in medical offices that need to be eliminated—and replaced with proper procedures.
It should also be noted that all the procedures discussed in this article are for an average-sized adult. For adults who are way outside the average in height, weight and health, they should be aware that these differences could effect procedures, including considerations about cuff height.
Procedures can also be different for children, and parents should be consulting with a doctor, but that doesn’t mean that every doctor is always doing everything correctly, even for children. Parents should always seek out correct procedures on their own and educate themselves and ask questions.
I also do not discuss any blood pressure numbers. That’s a whole new discussion, and there is no absolute number that is correct. All doctors do not absolutely agree on this, and the standards in the U.S. and other parts of the world do not agree. Again, study this for yourself.
Walking Naturally You Connect to the Ground with Two Points; With Poles It’s Four Points
The problem is that when a hiker with poles is ready to make a steep step down [a rocky trail], instead of using their body’s leg strength and natural balancing ability, they use the poles. When people walk without poles, they only have to find two points to connect to the ground: their two legs. With poles, they have to find four points, and two of those points are going to take some of the body’s weight, even most of it at times. This is one way that causes them [hikers with poles] to go slower.
All our lives, we learn to walk with two contact points to the ground. Then poles come along and make it four. You couldn’t design a more confusing way to screw up the walking and balancing habits that come from [a lifetime of] walking and from evolution. At some point, the body can’t go back to the normal way of walking; it’s too late.