Kudlow: Biden spending bill hangs in the balance
‘Kudlow’ host discusses inflation surge as consumer prices soar as inflation hits highest level for nearly 40 years.
Save America. Kill the Bill.
Two very important numbers came out today that I think virtually guarantees a "pause" in the big government socialist spending, taxing, and regulating bill proposed by President Biden. Virtually guarantees a pause. And a pause into next year gets us closer to killing the bill altogether.
Now the first number, a huge 0.8% jump in the CPI (consumer price index) for November, leading to a 6.8% increase over the past year – the biggest gain in 39 years.
As Senator Joe Manchin has said many times, there is simply no point in going forward with a big social spending bill while inflation is so hot. I have backed him for the last six months on this inflationary point, and I still support him on this critique. So has the Republican Party as far as I can tell.
Inflation is hot because we're spending too much money. In fact, Mr. Manchin's staff has calculated that in constant dollars, not including the Biden budget, the over the past year, the federal government has spent roughly $5.4 trillion, plus $1.2 trillion on infrastructure. That's $6.6 trillion.
Now get this: For all of World War II, plus the Marshall plan to rehabilitate Europe, we spent $4.7 trillion. Got it? We are now spending today on social welfare programs – without workfare, without means testing, without strict eligibility – vastly more than we spent for the entire World War II that literally saved freedom and democracy.
WHERE SURGING PRICES ARE FORCING YOU TO SPEND MORE
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And this $6 trillion dollar number, which has been financed indirectly by massive Federal Reserve money creation, is the source of the near 7% inflation. Stop the spending! End QE bond buying. Get ready for some modest Fed rate hikes. Then maybe in a year, inflation will begin to calm down. Maybe.
Here's the second big number that I believe will save America and kill the bill. The Congressional Budget Office has priced out the true cost of the Biden budget. The CBO took out the one-year or three-year "sunset" gimmicks and instituted permanent 10-year spending estimates.
Why permanent? Because that's been on the left-wing, progressive agenda for years and as President Biden always says, this bill will be "transformational." That means permanent if he gets his way.
INFLATION SURGES TO 39-YEAR HIGH AS CONSUMER PRICES SOAR AHEAD OF HOLIDAYS
Now the CBO scoring shows that the bill will actually cost $4.9 trillion dollars over 10 years, increase deficits by $3 trillion, and increase interest on the debt by $266 billion. That actually brings the topline costs to $5.1 trillion.
In other words, the CBO just blew up the Biden budget fiction that it would only cost around $2 trillion and only increase deficits by $365 billion. Or that it is fully paid for.
So let me repeat. Two numbers today – the spike in the consumer price index and a spike in CBO scoring of Biden's 'woke' budget.
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And I am predicting that this is going to sink any vote this year. And there will be a pause until February of next year, which itself may spill over into next year's spring or summer, and that moves us toward next year's midterm elections.
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And poll after poll shows that inflation is public enemy number one. But massive federal spending is a close second. In fact, the two are really inseparable. Also, in fact, the public is sick of left-wing, "woke" policies.
And that's why I believe we're going to Save America and kill the bill.
This article is adapted from Larry Kudlow's opening commentary on the December 10, 2021 edition of "Kudlow."
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