Powell’s Opinions on Inflation Matter, Not Biden’s
One of the reasons inflation got out of control in the 1970s is that policy makers had heterodox theories about its cause, such as powerful corporations and unions. You can hear echoes today when President Biden proposes combating inflation through toughened antitrust enforcement, higher corporate taxes and more domestic production.
These factors aren’t why inflation is over 8% and they offer little prospect of fixing it. So, if Mr. Biden had the last word on inflation, you might worry the U.S. was about to repeat the 1970s. But Mr. Biden doesn’t have the last word; Federal Reserve Chairman Jerome Powell does. Moreover, Mr. Biden affirmed exactly that in a Wall Street Journal Op-Ed last week, giving Mr. Powell the political cover to raise interest rates and get inflation down.
Read more on wsj.com
