“We’re all in this together.” Americans heard that repeatedly during the pandemic. Inflation, however, has proven how false that is. It’s shown how government officials, particularly those in the Biden administration, are startlingly disconnected from those who live outside the Capital Beltway.
Those officials appear to have no concept of the financial graves that their irresponsible regulatory, energy and monetary policies are digging for countless working-class families. And instead of offering a modicum of sympathy — even a disingenuous “I feel your pain” — they seem content to dance on those graves.
Perhaps that’s because this inflationary storm isn’t wreaking havoc on their personal shores. The elites are not particularly concerned about inflation because it does not have especially negative effects on their lives.
Inflation even enriches some of them if they are lucky enough to be the beneficiaries of the government spending that was paid for through inflation. The wealthy and high-income earners tend to have assets like real estate and investments whose prices rise with inflation, blunting the pain of higher consumer prices. Their incomes also tend to adjust to market conditions more frequently.
Conversely, the middle and working classes have fewer hard assets and investments that will inflate as prices rise. A larger portion of their savings are liquid cash, which has lost 13% of its purchasing power since Biden took office.
Although their wages have risen, price increases easily outpaced those modest wage gains. The average worker’s real annual income has lost the equivalent of $3,400 since President Biden took office. Under President Trump, the average worker’s real annual income rose the equivalent of $4,000 due to low inflation and a robust economy.
Inflation is widening the rift between the “haves” and “have nots” while reducing class mobility by robbing people of their savings and putting the American dream of homeownership outside the reach of many Americans. Homeownership affordability has plummeted since Biden took office, dropping 31% in less than a year and a half.
As millions of Americans struggle just to afford food and fuel, their budgets are stretched to the limit. Unable to make ends meet, they’re dipping into savings and falling into debt. Monthly savings have nosedived 75% under Biden, while credit card debt has climbed 19% and household debt has shot up $1.51 trillion to over $16 trillion for the first time ever. This depletion of savings and downward spiral into debt is unsurprising since real disposable incomes are down 11% since Biden took office.
Strapped for cash, the common man must decide whether to buy gasoline or groceries for his family. The elites, however, unburdened with such plebeian choices, cannot help bragging about it.
Mary Daly, the president of the Federal Reserve Bank of San Francisco, recently said the following regarding the supposed financial pain from inflation: “I don’t find myself in a space where I have to make tradeoffs because I have enough, and many Americans have enough.”
How fortunate for Ms. Daly and the other elites who are above the proletarian concerns stemming from inflation. The common man must surely be jealous that she need not make tradeoffs or compromises to her modus vivendi as prices rise like a rocket sled on rails.
Much like the infamous “let them eat cake,” which is often attributed to Marie Antionette, the modern elites have used the equally derisory “learn to code” when lecturing hard-working Americans in manufacturing and the fossil fuel industry. Indeed, half of the take hikes contained in the recent Schumer-Manchin BBB deal explicitly target domestic manufacturing and their workers.
The latest Orwellian wordplay from the elites is to downplay the economic reality of stagflation—anemic growth with high inflation—and simply deny the plight of their supposed inferiors. The patriciate’s disdain is palpable for the very people who make their ivory-tower lifestyles possible.
But particularly disturbing is not what is said explicitly, but what is implied. The implication is that the American people somehow need permission from on high to grieve their financial predicaments. It is as if these families who are hurting are not allowed to even acknowledge that hurt until a Biden administration official in an ivory tower deems their time of mourning appropriate. It doesn’t get more elitist than that.
Correction: This column has been updated to reflect a corrected URL.
Kevin Roberts is president of The Heritage Foundation. E. J. Antoni is a research fellow for Regional Economics in Heritage’s Center for Data Analysis.
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