President Joe Biden still doesn't get it. The "it" is inflation. Now, this is not exactly breaking news, but inflation is by far the number one issue in the country—by far — and Biden's approval rating regarding inflation is in the high 20s or low 30s. His disapproval is over 60%.
Now, to advance this story, I just want to point out that at the White House Correspondents' Dinner in D.C. Saturday night, comedian Trevor Noah made a joke about inflation—a pointed cutting edge. Whack! Which is what happens at these dinners. And Joe Biden sat there and laughed. Take a listen:
TREVOR NOAH: These people have been so hard on you, which I don't get. I really don’t. You know, I think ever since you've come into office things are really looking up. You know, gas is up, rent is up, food is up, everything.
For good or evil, the correspondents' dinner is now televised, so the whole country can see it, and if I were Joe Biden, I sure wouldn't be laughing at the massive price hikes for food, gasoline, and rent, which the comedian mentioned, and I want to add skyrocketing mortgage rates, natural gas, diesel for truckers, fertilizer for farmers, and on and on.
The latest CPI came in at 8.5%, the PPI over 11%, import prices 12.5%. The Fed's own inflation target came in at 8%. The 10-year treasury touched 3% today — 175 basis points higher than a year ago — and the 30-year mortgage rate is coming in around 5.5%. That is up roughly 3 full percentage points, or 300 basis points in the past year or so.
The moral of the story is that ordinary hard-working folks throughout the economy —cops, nurses, teachers, blue collars, hard-hats, people in Walmart, Target, restaurants, you name it – are suffering from high inflation and high interest rates, and there is no sign of relief on any of this.
In fact, the Federal Reserve will meet Wednesday and will probably raise their target rate by 50 basis points or half a percent, which will bring it to just under 1%, which is still 750 basis points below the inflation rate.
How about this? For investors, there are well over 100 million Americans invested in the stock market with their retirement savings through IRAs, 401ks or index funds, or the like. Year to date, the benchmark, S&P 500 is down 13%. But wait a minute. When you adjust that for inflation it's actually down well over 20%. Ouch, that hurts.
Joe Biden doesn't like investors. All he wants to do is tax them, but the majority of these people are not rich people. Yes, the richest have the biggest asset portfolios, but numerically the majority of investors are not rich people.
By the way, I'd like to help them get rich, which is why I keep saying the cavalry's coming, but I don't want to get ahead of myself. Joe Biden must not like farmers, or motorists, or renters, or homeowners with mortgages, or people who work in fossil fuels, or hard-hats who build pipelines. Besides woke climate change extremists, I don't know who he likes.
He's trying to buy off students by forgiving their loans. We'll talk about it a bit later in the show, but polls show young people are deserting Biden in droves just like everybody else.
Now, besides the Federal Reserve, which has a crucial role to play in the fight against inflation, I'd like to know one thing the Biden administration is doing to reduce inflation. Just tell me one thing.
The obvious ideas are to freeze domestic spending and open the regulatory doors to oil and gas production, but that's way too easy. Biden won't do that.
In fact, the president is still pushing his $5 trillion Build Back Better spending plan, which would ratchet the inflation rate up even higher, as would a blanket forgiveness of student loans. Just tell me one thing! That's all I ask. So far, I'm not seeing it and remember, inflation is the cruelest tax of all and it hurts working folks the most, over $5,000 a year.
Now, final point, there is this insane $350 billion spending bill working its way through Congress allegedly to compete with China.
It will do no such thing. It will just spend more and inflate more and borrow more. It is outrageous with raging inflation to even consider a $350 billion spending bill, which, by the way, is nothing more than pork barrel, Green New Deal, corporate welfare, industrial policy picking winners and losers.
You want to compete with China? Make the Trump tax cuts permanent and start slashing overregulation and spending and I have to add, that in the first vote in the Senate, 18 Senate Republicans voted for this monstrosity.
Since we believe in accountability here, I have a little hall of shame: Capito, Cassidy, Collins, Cornyn, Crapo, Daines, Grassley, Moran, Murkowski, Risch, Romney, Rounds, Sasse, Sullivan, Tillis, Wicker, Young, and some others. This is not an honor roll. Save America. Kill this bill.
This article is adapted from Larry Kudlow's opening commentary on the May 2, 2022, edition of "Kudlow."