President Joe Biden keeps trying to deflect blame for runaway inflation, continuing to insist that his policies of tax increases and more spending would help reduce it.
Despite his wishful thinking, the latest numbers show inflation is still rising sharply and increasing at the fastest rate in 40 years.
Biden blames everyone else for the soaring inflation, and his call to raise taxes is the last thing we should do in this fragile economy. Yet the White House and congressional Democrats keep pushing to increase taxes.
Financial markets have plunged this year, posting heavy losses due to fears of higher interest rates, inflation, and global instability. In April, markets had their worst month since the pandemic began, and the S&P 500 has had its worst start to a year since World War II.
With interest rates set to rise even more, markets and economic experts are worried that we are heading for 1970s-style stagflation and recession.
Former] Secretary of the Treasury Larry Summers believes that the Federal Reserve's delay in reversing its easy money policies has charted a course to stagflation and "ultimately a major recession."
Wall Street banks are warning of an economic downturn, and Deutsche Bank is telling its clients that "a major recession" is coming as the Fed steps on the brakes to curb inflation.
Main Street businesses are also concerned about the economic outlook, with 8 in 10 small businesses convinced that a recession is coming.
With so much negative sentiment and uncertainty weighing down the economy, more taxes and spending would do major damage. Raising taxes now would be a tragic mistake.
Bruce Thompson was a U.S. Senate aide, assistant secretary of the Treasury for legislative affairs, and the director of government relations for Merrill Lynch for 22 years.