Congress, not the Fed, should reduce today’s inflation


Throughout our history there have been many causes of inflation, but two of them have been persistent and are in conflict with each other. First, wealthier persons create inflation when they buy large amounts of our nation’s resources, products and services. Secondly, low- and middle-income persons create inflation when they make more money and buy more things.

These are the causes of inflation that Congress has controlled in the past through tax and labor legislation, and by the Federal Reserve controlling the money supply. A growing economy always has inflation, and everyone — rich, poor and middle class — is hurt by it. But those who cause it benefit far more than they lose.

President Donald Trump’s 2017 Tax Cuts and Jobs Act had an especially bad inflationary effect during a pandemic. It gave huge tax cuts for corporations and the rich, and token small tax cuts for workers. Of course, those whose incomes weren’t high enough to pay taxes got no benefits. Those on the lower end of the economic scale were, and still are, the ones most devastated by inflation.

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