Kelly Sloan

President Joe Biden is finally coming to the realization that the current inflation levels are not a temporary blip, as he tried telling everyone last summer, and are actually a serious and lingering problem. Enough so that the President took to the opinion pages of the Wall Street Journal earlier this week with an op-ed entitled “My Plan for Fighting Inflation."

As you may have guessed, it’s not much of a plan, even once you get past the rather delusory and self-congratulatory passages that read more like copy for a campaign TV add than a policy outline.

He starts out by stating the obvious: “the global economy faces serious challenges,” but it goes quickly downhill from there.

Biden tries, as he has before, to hang the blame for inflation exclusively on Vladimir Putin and the invasion of Ukraine. Putin and the Russians certainly have much to answer for, and the war in Eastern Europe quite naturally bears with it economic shocks — including in the global energy and food markets. But America’s inflation problem began long before Russian tanks started rumbling across Ukraine’s borders.

The first leg of his proposal is singular in that it is the only one which actually makes some sense. Biden says, quite correctly, “the Federal Reserve has a primary responsibility to control inflation.” He obliquely affirms his commitment to an independent Federal Reserve, which again is entirely correct and quite welcome. Having the Fed fall under direct political control would be a nightmare of monetary policy being continuously manipulated to orchestrate artificial booms and busts in line with election cycles. The long-term consequence to the national economy from such marionetting would be disastrous. So kudos for that.

But at the same time the President failed to recognize the deleterious role that the Fed played in creating the mess. The central bankers kept the monetary floodgates open for far too long after the initial panic over COVID-19’s impact on the economy, and has been far, far too slow in taking the necessary measures needed to beat back inflation now with an aggressive tight money policy.

It gets worse after that. He begins his second plank with another self-evident comment: “we need to take every practical step to make things more affordable for families during this moment of economic uncertainty — and to boost the productive capacity of our economy over time.” Bravo. Of course that comment is antithetical to pretty much every economic policy that has emanated from the White House in the last two-and-a-half years. And his very next statement is positively Trumpian in its licentiousness with the facts: “The price at the pump is elevated in large part because Russian oil, gas and refining capacity are off the market.”

What hogwash. Russian oil accounts for, at best, 8% of U.S. oil imports, a number that is easily replaceable with oil from Canada or elsewhere. Domestically, if we’re really desperate, the Keystone pipeline — which Biden personally kiboshed — could have supplied enough Canadian crude to make Russia’s meager contribution to American energy entirely negligible. Historically high pump prices for gasoline and diesel have little or nothing to do with Russian oil and refining capacity being off the market, but with U.S. refining capacity being increasingly off the market.

Refineries have been closing down across the U.S., many of them being converted to alternative fuels like bio-diesel. And the country has not seen a new refinery built in years. This is a direct result of regulatory pressure urged by an outsized and environmental lobby, which has also successfully manipulated the cultural zeitgeist to where CEO’s of energy companies have adopted a myopic urge to convert from reality to chimera. We can drill all we want, and release as much oil from the strategic reserve as we want, but if it cannot be refined into something that can meet the demand of transportation, then it does little good, no matter how high oil prices are. And Biden has no plan for easing pump prices by helping increase refining capacity.

This should perhaps be considered the next time efforts are renewed to choke Suncor’s Commerce City refinery to regulatory death.

The rest was in the same vein. Inflation is caused by loose money supply, and a lack of productivity. An effective plan would involve getting government out of the way; of refining, of productivity, of growth, of business. That would require President Biden getting out of his own way, and that he simply cannot do.

Kelly Sloan is a political and public affairs consultant and a recovering journalist based in Denver.

Kelly Sloan is a political and public affairs consultant and a recovering journalist based in Denver.

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