This blog is generally about healthcare, but with the important midterm elections coming soon, I felt it necessary to make an exception in this case. “Affordability” has become a focal point of the election and I want to set the record straight so people can make an informed decision who they elect.
For those of you who do not read The Wall Street Journal, the editorial board just published an excellent article to address this issue called “The ‘Affordability’ Democrats? You Have to Be Kidding”. Read the entire article with this link or read my summary of the article below.
The editors say, “Democrats are trying to capitalize on voter frustration with inflation by running on “affordability.” Fair enough, but then let’s look at their record in power on the cost of living and what they propose if they win. Affordable by whom is the question. One basic measure is inflation, which captures the overall price level. The consumer price index increased on average 5% a year during the Biden Presidency, versus 1.9% during the first Trump term and 2.9% so far during the second.”
Both parties contributed to the initial burst of inflation during the Biden years with their spending splurge in late 2020. But Democrats in March 2021 fueled the fire with their $1.9 trillion spending blitz, largely for transfer payments and for states and localities. The Federal Reserve made the mistake of accommodating the spending binge. Yet as inflation heated up in 2021, Democrats urged the central bank not to raise interest rates.
The Biden team also relaxed mortgage underwriting standards, which enabled borrowers to qualify for bigger mortgages and turbocharged the surge in home prices. Housing prices rose 5.3% a year on average during the Biden years, compared to 2.7% during the first Trump term and 3.7% so far in the second.
It costs on average about 2.8 times as much to build an apartment in California as in Texas, according to the RAND Corp. Some “affordable” housing projects in the Golden State cost more than $1 million per unit to build. One reason is state and local prevailing wage mandates, which Democrats want to require for all projects that benefit from federal funds.
Democrats also want to raise the $7.25 an hour federal minimum wage to $15 or higher. Most Democratic-run states already impose minimum wages of at least $15 an hour, so this would mainly slam states with lower wage mandates, many of which have contested Senate races this year like Texas, Iowa and New Hampshire (all $7.25) and Ohio ($11). Businesses pass on higher wage costs to consumers to the extent they can.
Gasoline prices have shot up amid the war in Iran. But the inflation-adjusted average of $3.43 a gallon across the second Trump term is still lower than the $3.89 average in the Biden years. The average was $3.27 in the first Trump term.
Recall how the Biden Administration tried to restrict oil and gas production by cancelling leases in Alaska’s Arctic National Wildlife Refuge, banning new offshore drilling in much of the Gulf of Mexico and Atlantic coasts, and pausing leases on federal lands. The result: Higher prices.
Or consider the climate-policy utopia of California, where gasoline costs $6.37 a gallon and diesel $8.40. The state’s cap-and-tax program, low carbon fuel standard and hefty fuel taxes have driven up fuel prices and spurred refineries to shut down. Democrats now talk less about climate than during the Biden years, but their goal of banishing fossil fuels persists.
The editors conclude with these important points:
“So what are Democrats now proposing to improve affordability? More of the same policies—more spending on welfare and “affordable” housing, more green-energy subsidies, more healthcare regulation and higher minimum wages nationwide. Democrats claimed the Affordable Care Act would reduce healthcare costs. But that law’s command-and-control regulations drove industry consolidation and pushed up prices instead. Premiums for employer plans have roughly doubled since 2010, rising at about twice the rate of inflation.
As for tariffs, Joe Biden vowed in the 2020 campaign to repeal Mr. Trump’s first term border taxes but never did. You can’t believe Democrats will do so now, especially given that labor unions support many of the tariffs. Democrats also want to raise taxes on business, which would flow to consumers in higher prices.”
We all want prices to come down, but this thorough analysis by WSJ shows the Republican Party is doing a better job of lowering prices than Democrats did under Joe Biden. The Iran conflict has raised prices temporarily, but we should be glad to trade that for the security of knowing Iran is not going to get a nuclear weapon that everyone knows they would use to destroy The United States and Israel – the Great Satan and the Little Satan in their way of thinking. There is a price to pay for freedom.
