Though America suffered through multiple crises in 2021, most voters seem focused on one issue at the end of the year: inflation.
While President Joe Biden’s White House kept trying to comfort the country by saying the inflation surges were “temporary,” the situation only appeared to get worse during the holiday season.
In fact, the U.S. economy saw a number it hasn’t seen in 4 decades.
Toward the latter end of 2021, economists and consumers alike noted the concerning rise in prices. This seemed to hit the food and energy markets the hardest, as gas prices soared.
People noticed that basic necessities cost more than ever, and the availability of certain items was also highly questionable. This was mostly attributed to serious supply chain issues throughout the nation.
Now, the Labor Department has confirmed many fears: December was indeed a very tough month.
Not only did prices surge for consumers, but inflation rose at the fastest pace in 40 years. The report comes hot on the heels of the President trying to reassure the country about the economy.
Via Fox News:
The consumer price index rose 7% in December from a year ago, according to a new Labor Department report released Wednesday, marking the fastest increase since June 1982, when inflation hit 7.1%. The CPI – which measures a bevy of goods ranging from gasoline and health care to groceries and rents – jumped 0.5% in the one-month period from November.
Economists expected the index to show that prices surged 7% in December from the year-ago period and 0.4% from the previous month.
Once again, it was the food and energy category that saw the biggest jumps.
Prices in that department leaped 5.5 percent in a year-over-year comparison, and that’s even higher than the 4.9 percent jump in November. It’s the comparison to 2020 that stings most:
Even though energy prices dropped slightly (1.1%) in December, they were up a whopping 29.3 percent when compared to 2020.
Gas prices were up almost 50 percent, food prices climbed 6.3 percent, and used vehicle prices surged 37.3 percent. In other words, the general cost of living flat-out skyrocketed during the last month of the year.
Said Seema Shah, Principal Global Investors chief strategist:
Inflation at 7% is no joke. It’s the highest annual CPI number since 1982 and driven not by energy prices, but by just about everything else.
Shah added that December might’ve been the peak, and that the supply chain might be improving. However, with the spread of the latest coronavirus variant, economists are once again concerned.
And none of it is good news for the Biden administration.
The President’s approval ratings tanked in the second half of 2021, with some recent polling showing Biden at an abysmal 35 percent. Vice President Kamala Harris is even lower according to some surveys.
It’s no surprise to see declining approval numbers among rising inflation.
In fact, December marked the 7th consecutive month that inflation rose by 5 percent or more, and that has had a direct impact on the people’s belief in their leaders.
If Biden can’t solve this problem in 2022 and U.S. consumers continue to struggle, that could point toward a significant shift in power in D.C. The “red wave” might be imminent in the midterm elections.
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