Last week, I got a letter from Sen. Jim Risch, R-Idaho, heard a dozen radio talk shows and saw former President Donald Trump all talk about the horrors of inflation. None mentioned that deficit spending is a major cause of inflation. We’ve been there and done that, many times. When we don’t pay the government bills, we get budget deficits that cause inflation. Republicans no longer know this fact.
During the Vietnam War, we had inflation. It got lots worse when the war ended. Where I first lived after college, housing jumped 10% a month by the end of 1974. Local job changes brought small pay raises but never enough to even buy a small starter-house. So we moved and got a 30% raise in a new state where housing cost lots less.
Mortgage rates ranging from 7% to 9% were thought to be reasonable back then. By 1979, mortgage rates neared 15% annual percentage rate in the U.S. and inflation was a worldwide problem. In 1981, the new president, Republican Ronald Reagan, cut spending and taxes. But he blew up the national debt and restarted inflation; eventually he had to raise taxes.
When the Cold War ended, mild inflation restarted and in 1989 Iraq invaded Kuwait. We had a short war, but overspent and kicked off more inflation and a new debt crisis. George H.W. Bush, the president who won the war, couldn’t keep his word on taxes and lost his reelection.
The next new president, Democrat Bill Clinton, raised taxes. But he also cut domestic and defense spending, thereby getting inflation under control. Clinton even got some Republican help. We had eight years of an improving economy. We not only balanced the budget for the first time since Vietnam, we even started to pay down the national debt.
Then in 2000, another new president, Republican George W. Bush, decided deficits and debt no longer mattered. Under him, the national debt exploded. We started two wars (one necessary and one based on fraud) and the unpaid debt re-ignited inflation. We paid for neither war. Inflation wasn’t bad at first, but got worse.
Under Republican President Donald Trump, we added $8 trillion in new debt. Inflation only slowed when the COVID-19 pandemic hit and unemployment spiked. Lots of people and businesses couldn’t pay their bills, so the Trump government stepped in with massive spending, re-starting inflation.
Some grocery corporations and Big Oil got very greedy. Kroger and Albertsons just admitted price gouging in court hearings on their proposed merger and Big Oil is producing oil and gas at record levels, but prices don’t come down. Why?
The Trump tax cuts didn’t grow the economy enough to pay for its costs. The costs of the recovery have been high. The current administration under Democratic President Joe Biden has actually started to cut deficit spending and inflation is slowing.
Bottom line: Wars and budget deficits cause the U.S. to have inflation. Every time it happens, we eventually navigate to lower inflation. We’ve done that by cutting deficits.
Republicans whine about inflation. Yet they propose no solutions that could work. The party platform says “drill for more oil.” More oil waiting to be refined won’t bring down costs, nor will it build houses. It won’t control prescription drug prices or bring more manufacturing jobs back onshore from China or India. Is new massive unemployment their solution to inflation?
Their tariff plan is just a tax increase on Walmart shoppers. Countries don’t pay tariffs; consumers pay tariffs.
Americans are making more electric cars and building batteries in the U.S. Republicans oppose electric cars. Why? Consumers are buying more of them each year.
Computer chip making was an American industry. But it was mostly exported overseas. Yet under the current Democratic administration, the jobs and manufacturing are coming back to America. Why are Republicans opposed?
Idaho Republicans even rejected the expansion of Micron Tech, our own high tech giant. So Micron went to New York and is creating the jobs there. Those jobs could have been in Lewiston or Moscow. Why did Idaho Republicans reject the jobs?
Finally, since the U.S. Supreme Court sent abortion back to the states, Republicans no longer care about treating complications of pregnancies, even to save a woman’s or little girl’s life. So, aside from tax cuts for the rich and running up the national debt, there is no national Republican plan for the American people.
In the past four years, Republicans have opposed efforts to control inflation, to bring jobs back to America from overseas, to compete in new industries, and to protect women’s health and health care. Idaho law requires insurance to cover complications of pregnancy, but now prohibits doctors and hospitals from providing live-saving treatment.
The GOP’s reasoning is lacking and/or faulty.
Do Idaho Republicans plan to fix what they have broken?
Sherry, of Lewiston, taught school and also worked for 30 years on Idaho state insurance laws.