Nearly four years ago, the Biden administration and Congressional Democrats made a $1.9 trillion bet in the form of the American Rescue Plan. They lost, as it contributed to a surge in inflation that fueled massive voter discontent and Donald Trump’s return to the White House.
Why it matters: In the next recession, politicians and policymakers may be more hesitant to unleash the type of programs that drove America’s rapid recovery from the pandemic-induced crisis.
Let’s not forget other inflationary impactors. Russian energy coming off the broader market, Ukrainian food exports being offline for a year, a major shipping route through the Red Sea becoming more expensive to navigate, and even smaller things like a certain ship getting itself lodged sideways in a major global shipping artery for a little bit. Not even to speak of existing tariffs in the US that never came off.
Lots of individual factors stressing an already pandemic-stressed situation.
Yes, absolutely. I was largely restricting it to domestic factors and admittedly jamming a lot into the phrase “supply-chain issues.” ☺️