Former President Joe Biden left a terrible legacy: the border catastrophe, chaos and disorder abroad, increased crime, oppressive wokeness. But for today's purposes, consider the damage done by Biden's economic policies.
Inflation took away 20% of people's purchasing power in a short period of time. Even when the rate of inflation slowed, it is still, right now, rising faster than economists -- or anybody else -- are comfortable with. This week, there will be new numbers for inflation in January, and the message again will be that Biden brought inflation on but was unable to fully get rid of it. Now that is President Donald Trump's job.
Meanwhile, recent reports have brought word of what the New York Times called an "unusually large" downward revision in the number of jobs we thought were created in Biden's final year, since March 2024. The bottom line is that about 600,000 fewer jobs were created in that period than we were told at the time through monthly jobs reports. "The Biden jobs market was way worse than markets thought," Trump White House economic adviser Kevin Hassett said recently. "There's a lot of cleaning up to do."
Then there is federal spending. Biden and his Democratic colleagues on Capitol Hill went crazy with spending. Coming off the already-high emergency COVID spending of the final year of the first Trump administration, Biden and congressional Democrats poured trillions of dollars unnecessarily into the economy.
First, Congress passed a $900 billion "COVID relief" bill just after Christmas 2020, as Trump was heading out the door. Biden, then president-elect, strongly supported it. Once Biden was in the White House, he pushed Democrats to pass his $1.9 trillion American Rescue Plan in March 2021.
One-point-nine trillion dollars. Did the economy really need a stimulus of that size? It was pretty clear, even at the time, that it did not. A month before it was passed, former Treasury Secretary Lawrence Summers wrote that, given the $900 billion stimulus that had already been passed, "the gap between actual and potential output [of the economy] will decline from about $50 billion a month at the beginning of the year to $20 billion a month at its end. The proposed [American Rescue Plan] stimulus will total in the neighborhood of $150 billion a month. ... That is at least three times the size of the output shortfall."
Biden and the Democratic Party decided to pass the bill anyway, spending $150 billion a month to fix a $20 billion a month problem. That much money flooding the economy was going to worsen inflation.
But Biden, who fantasized about being a new Franklin Delano Roosevelt, did not stop there. Later in 2021, he signed a $1 trillion infrastructure bill -- this one made possible in part by a minority of House and Senate Republicans who joined Democrats in supporting it.
And then Biden took aim at what would be the biggest spending extravaganza ever -- the proposed $2.2 trillion Build Back Better Act. It would spend on everything: climate change, housing assistance, welfare, Medicaid, everything.
By the time the House passed a version of the bill, in November 2021, inflation had already reached 6.8%. (It would hit 9.1% in June 2022.) Some Senate Democrats got nervous about Biden's reckless spending and forced reductions in the Build Back Better Act. It was downsized to $750 billion, including about $370 billion for climate spending and the rest for health care and other expenses. Then Biden gave it a new name: the Inflation Reduction Act.
With inflation raging, still going up, and millions suffering, it was an act of supreme cynicism to call a bill that would make things worse the Inflation Reduction Act. But that is what Biden and his Democratic allies did, passing the bill in August 2022.
Only now are we learning the true damage the Inflation Reduction Act did. Look at this from the Cato Institute: "The Inflation Reduction Act was initially touted as a deficit-neutral bill, with its ten-year energy and climate-related provisions projected to cost about $370 billion, offset with tax increases. However, in an upcoming Cato policy analysis, Travis Fisher and Joshua Loucks estimate that the IRA will cost between $936 billion and $1.97 trillion over the next ten years and up to $4.67 trillion by 2050 (and perhaps even more in later years because the subsidies are uncapped.)"
In other words, with the Inflation Reduction Act, Biden and Democratic lawmakers created a perpetual spending machine. It's possible some of them didn't even know what they were doing. "If I'm being cynical, they may have been misled by advocates who knew how to game the scoring," Cato's Travis Fisher told me in an email exchange. "Even some policy analysts who should know better were fooled by this one."
So were millions of Americans, of course. And in the end, they didn't get what their trillions of dollars were supposed to buy. In the infrastructure bill, for example, there was $42 billion that was supposed to bring high-speed internet to Americans in hard-to-reach areas. More than three years later, it has not connected a single person. There was also $7.5 billion to build tens of thousands of electric vehicle chargers. More than three years later, only a few dozen have been built.
That makes sense; Biden and Democrats passed money faster than anyone could possibly use it, and even though they raced to shovel cash out the door in December and January, many billions remain unspent. President Trump has put a freeze on Inflation Reduction Act funds, and there could be a fight over it in Congress.
But none of that changes the final conclusion. Joe Biden, imagining himself to be FDR, did enormous damage to Americans' standard of living. They will be suffering a Biden hangover for a long time to come.
This content originally appeared on the Washington Examiner at washingtonexaminer.com/daily-memo/3317404/biden-economic-hangover/.
Byron York is chief political correspondent for The Washington Examiner. Email him at byork@washingtonexaminer.com. For a deeper dive into many of the topics Byron covers, listen to his podcast, The Byron York Show, available on the Ricochet Audio Network at ricochet.com/series/byron-york-show and everywhere else podcasts are found.
Join the conversation as a VIP Member