America’s Latest Inflation Check-In Doesn’t Look Good for Trump
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America just had its last major checkup on inflation ahead of the midterm elections, and the results aren’t looking good.
Yesterday, the Bureau of Labor Statistics released September’s update to the Consumer Price Index, one of the most important metrics for understanding how much Americans actually pay for goods and services. (Among them: cupcakes, dental care, sports equipment.) Overall, costs for consumers have been rising faster than economists expected.
They’re up 3.7 percent over the past year, and September marked the largest monthly increase since April—much of which had to do with massive Iran-war-driven spikes in energy prices.
That’s just the first half of the problem.
At the same time, the BLS revealed yesterday that Americans now have less spending power than they did earlier this year.
Real wages—the average amount, adjusted for inflation, that workers earn an hour—have tumbled back down to about where they were when Donald Trump retook the presidency last January.
Prices are now rising so fast, across so many different industries, that they’ve overwritten nearly two years of wage gains.
As the economist Jared Bernstein put it in his CPI postmortem today, “It’s one thing to cope with high prices when your earnings are at least keeping pace with inflation.
But when they’re falling behind … well, that makes for a much tougher equation.” Kevin Hassett, the Trump-appointed director of the National Economic Council, said yesterday that he sees a “whole bunch of good news” in the CPI report—namely food prices (they’ve held relatively steady) and prescription-drug prices, which have gotten lower (something he credits to Trump’s online drugstore ).
The sheer scope of the data makes it easy to cherry-pick examples.
The prices of both milk and cookies have gone down since August too, so at least Trump’s economy has been good to Santa.
But as economists and Democratic politicians have been quick to point out, the overwhelming majority of the data don’t support that optimism.
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