A version of this story appeared in CNN’s What Matters newsletter. To get it in your inbox, sign up for free here.
- The Supreme Court blocked Biden’s effort to curb Covid-19 with a vaccine or testing requirement aimed at large businesses. The court allowed a more targeted requirement for health care workers to remain.
- Sen. Kyrsten Sinema, an Arizona Democrat, likely put the nail in the coffin of Democrats’ hopes to create a new national voting standard. She supports her party’s elections legislation but opposes changing Senate rules and wants to respect the views of the minority, she said in a speech on the Senate floor.
Those developments highlight that presidents, for all they can do on their own, are hemmed in on the big stuff by the other branches of government.
A Supreme Court with a strong majority of Republican-appointed justices has no interest in imposing restrictions on businesses.
A closely divided Senate is paralyzed by its traditions.
It’s the news about inflation that could be most damaging to Biden.
Everyday people might not be hanging onto the latest voting rights developments. But they are seeing prices go up. They’re facing empty grocery store shelves. They may be nervous about going in to work as the Omicron variant of the coronavirus tears through the country.
They’re wondering what the heck is going on.
Where are the groceries? The images on social media of empty grocery store shelves are startling. CNN’s Parija Kavilanz writes it is not that there is no food. It’s that stores are having trouble getting it on shelves. There are worker shortages and transportation issues. And people are making food at home rather than going to restaurants.
Consider the grocery store worker. CNN’s Nathaniel Meyersohn looks at an industry where it’s not possible to work from home, where it’s been hard for stores to find clerks and where some stores have had to limit hours. He talked to Sam Dancy, a supervisor and union shop steward at supermarket chain QFC in Seattle. From the report:
Two weeks ago, (Dancy) worked on a crowded Sunday when the store was short staffed. It “was the first time in 30 years I thought ‘I don’t know much longer I can and want to do this.'”
For an idea of the mercurial nature of inflation during the pandemic, read this report from CNN’s Chris Isidore and Allison Morrow.
Why can’t Biden or Federal Reserve Chairman Jerome Powell simply fix this? Isidore and Morrow write:
Many of the increases are the result of global market forces, such as higher energy prices, or global supply chain problems limiting the availability of parts needed to make consumer goods. The limited supply of both new and used cars, largely stemming from a computer chip shortage, has resulted in record car prices — a major factor pushing overall prices up.
Econ 101. While meat and some other prices have started to come down, the current perception is one of prices rising, not falling. Government relief measures, Isidore and Morrow write, put more money in the hands of consumers, creating more demand at the same time supply chains were snarled by the pandemic.
“Strong demand plus limited supply is the Econ 101 definition of what leads to higher prices,” they write.
Energy prices are up compared with a year ago, and those costs to businesses are being passed along to consumers.
A shortage of workers is leading to higher wages, which could further drive up prices.
Inflation is bad. But it’s been worse. In a separate story, Isidore notes that despite how bad inflation seems now, it’s still far below the crippling price increases of the ’70s, leaving a one-term President from each party in its path.
Isidore writes: Presidents Gerald Ford and Jimmy Carter both tried and failed to bring prices under control. Ford’s efforts included a “Whip Inflation Now” or WIN campaign, complete with shiny red buttons, that did little to help with prices. Inflation hit 12.2% in late 1974, soon after he took office, nearly twice the annual pace of increase through November of last year.
The nightmare scenario. CNN’s Paul La Monica writes that “stagflation” is now a real possibility. That’s when there’s a stagnant economy but prices continue to inflate.
A serious case of these economic crosswinds all but sunk Carter’s bid for reelection. In a stagflation scenario, there’s even less the government can do. Government spending only creates more inflation. Cutting government spending only leaves the economy in a slowdown.
For now, the economy is still growing at a healthy clip. And hopefully the Omicron-induced slowdown will be brief, the supply chain will continue to unsnarl and most people won’t have to worry about groceries quite as much.
Pay attention to the Costco parking lots. CNN’s Maeve Reston cased the Costco parking lot in Reno, Nevada, and talked to people who are frustrated by the rise in gas prices — it costs $145 instead of $100 to fill up a pickup truck — and are forgoing things at the box store.
“There’s nothing more fundamental than struggling to feed a family,” Reston and Stephen Collinson write, foreshadowing an election in which Democrats are all but expected to lose one or both majorities on Capitol Hill.
“Voter testimony in Nevada recalls the evidence in the Virginia gubernatorial race when Republican Glenn Youngkin pulled off a shock win by actually listening to what voters were saying about education and the cost of groceries, while Democrats were running against the extremism of ex-President Trump,” they write.
The irony is painful for Democrats. They have been blocked by Republicans and by a few of their own in passing the more ambitious social elements of Biden’s agenda — like universal pre-K, help with child care costs and an enhanced child tax credit — that could help free up money for groceries.
Republicans, set to gain on the economic discontent, want none of those direct supports.