Biden-Harris inflation spiked the cost of living and is the primary reason for the port strike
Port strike posses largest supply chain risk since COVID
National Association Wholesaler Distributors Eric Hoplin on the potential impacts of port strikes across the U.S. that could affect shipping and shortages.
The failed policies of the Biden-Harris administration gave America 40-year-high inflation, labor unrest, and now potentially the costliest strike in American history. By directing its 45,000 members to walk off the job, the International Longshoremen's Association (ILA) union is crippling eastern seaboard ports and costing $5 billion per day.
In October 2021, I warned that the tax-and-spend agenda of the Biden-Harris administration would set an inflationary fire and torch Americans’ finances, resulting in labor unrest. By the fall of 2023, we had the largest auto strike in history as the United Auto Workers (UAW) demanded higher wages to counter their losses from inflation.
While the UAW strike was disruptive to the auto industry, it didn’t cause severe economic harm or noticeably impact the consumer. The ILA walk-off is an order of magnitude worse, with the potential for severe disruptions to the economy if it lasts more than just a few days.
BALTIMORE RESTAURANT OWNER SAYS PORT STRIKE IS ALREADY IMPACTING BUSINESS: 'IT REALLY HURTS'
The 36 ports on the Gulf and East coasts handle 55% of all U.S. container traffic and large volumes of exports, including about half of U.S. pork and almost three-quarters of U.S. poultry. About half of all imported fruits and vegetables come through these ports as well. In pharmaceuticals, nine out of 10 imports and seven out of 10 exports are being disrupted.
Striking longshoremen walk in the rain at the Port of Baltimore as both sides jockey for position in negotiations. (FOX NEWS)
In short, America’s international trade has been severely hamstrung, with consumers and businesses alike about to get hit hard if this labor dispute isn’t resolved quickly.
The primary reason for this and other labor unrest over the last three years has been the stratospheric rise in the cost of living, which stems directly from mismanagement by the Biden-Harris administration.
Biden and Harris pushed for runaway federal deficits, fueled with newly created money from the Federal Reserve, destroyed one-fifth of the dollar’s value in less than four years. It also caused violent fluctuations in interest rates for everything from mortgages to credit cards.
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The result has been a cost-of-living crisis with homeownership affordability plunging to some of the lowest levels on record, while families pay over $300 billion annually just in interest on their outstanding credit card balances. Despite the average American’s weekly paycheck being larger than ever before, it buys less than it did just four years ago.
But the plunge in the dollar’s purchasing power has hit businesses every bit as hard as consumers, and the Biden-Harris administration’s own data proves it. Prices paid by firms and by customers have both increased 20% since January 2021, meaning businesses have merely passed on their cost increases to consumers.
Inflation has massively increased both the cost of living and the cost of doing business, leaving no winners but government. So, while workers are demanding higher wages to combat today’s sky-high cost of living, management is desperate to control increases in the cost of doing business — and that includes labor costs. With such tight margins, any pay increases to workers will result in higher prices for customers.
But that didn’t stop the Biden-Harris administration from weighing in and siding with the strikers, citing growth in corporate profits as somehow indicative of management’s misbehavior. Corporate profits have increased in the same sense that families’ paychecks have increased, but both buy less, on average, than they did four years ago because of the hidden tax of inflation.
Biden and Harris pushed for runaway federal deficits, fueled with newly created money from the Federal Reserve, destroyed one-fifth of the dollar’s value in less than four years. It also caused violent fluctuations in interest rates for everything from mortgages to credit cards.
Of all the politicians in Washington, D.C., Vice President Kamala Harris owns a disproportionate amount of the blame for inflation over the last four years. Not only was she the biggest cheerleader of the president’s big-government agenda, but she also cast the tie-breaking vote on trillions of dollars in inflationary federal deficit spending.
What’s particularly worrisome is that Harris hasn’t learned from her mistakes. She’s doubling down instead, proposing more of the same economic malfeasance that got America into this mess. If public policy continues down the path of the last three-and-a-half years, it will mean more inflation, more labor unrest, and evermore disruptive strikes.
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E. J. Antoni is a research fellow for regional economics in The Heritage Foundation’s Center for Data Analysis and a senior fellow at Committee to Unleash Prosperity.
