WASHINGTON, July 20 (Xinhua) -- The current painful U.S. inflation and its broader economic consequences directly result from bad Democratic policies, The Hill reported on Monday.
The report listed four factors that have led the country deep into the mire of high prices.
Firstly, trillions of dollars in reckless spending in 2021 when the economy was recovering, which led to too many dollars chasing too few goods. Secondly, the numerous government programs such as expanded unemployment insurance through most of 2021, which encouraged Americans not to work, reducing the labor supply and pushing up costs.
Thirdly, radical green energy policies downstream from U.S. President Joe Biden's "guarantee" on the campaign trail "to end fossil fuel," which reduced supply and drove up gas prices. Last but not least, support for easy money and the Modern Monetary Theory policy, which have led to a historic expansion of the money supply and devalued the dollar.
Things are especially difficult for small businesses, the report noted, adding that the Bureau of Labor Statistics has revealed that wholesale prices have increased 11.3 percent over the past year.
"Small businesses operating on narrow profit margins have no choice but to pass along these high costs, potentially alienating loyal customers, reducing demand, and accelerating the inflationary cycle," it said, warning that historic inflation is pushing the U.S. economy into a recession.
