Manchin calls for energy boost, Fed action after inflation spike

Democratic Sen. Joe Manchin of West Virginia called on the Biden administration Tuesday to curb inflation by boosting domestic energy production and for the Federal Reserve to take action after data showed price hikes hit a new four-decade high in March.

The centrist senator effectively killed President Biden’s more than $2 trillion social and environmental spending bill in December and continues to stand in the way of a pared version of the plan, citing inflation.

“It is a disservice to the American people to act as if inflation is a new phenomenon,” Manchin said in a statement, taking a veiled swipe at the White House calling inflation a “Putin price hike” caused by Russian President Vladimir Putin’s invasion of Ukraine on Feb. 24.

“Hard earned wages and financial savings are disappearing faster every month as prices continue to climb, while the pain and frustration of spending more on everyday items lingers over us all, especially among those who can afford it the least,” Manchin said. “Americans are seeing some of the largest increases in goods such as gas up 48%, beef up 16%, chicken and milk up 13%, and staples like coffee and eggs are up 11%.”

The moderate Democrat, who can single-handedly dictate what legislation passes in the evenly divided Senate, added, “The United States of America is equipped to be energy independent from Russia and other terror-sponsoring countries while also working to fight global climate change and break our dependence on the critical mineral supply change from China.”

Reducing inflation “demands the Administration and Congress, Democrats and Republicans alike, support an all-the-above energy policy because that is the only way to bring down the high price of gas and energy while attacking climate change,” said Manchin, who is reviled by environmental activists for his investments and former career in the coal industry.

“[W]e cannot spend our way to a balanced, healthy economy and continue adding to our $30 trillion national debt,” he added.

Manchin also slammed the Federal Reserve for not doing more to limit the effects of inflation — though he didn’t specify what course of action should be taken, such as increasing interest rates or reducing the Fed’s buying of US Treasury bonds.

“Getting inflation under control will require more aggressive action by a Federal Reserve that waited too long to act,” he said.

“The Federal Reserve and the Administration failed to act fast enough, and today’s data is a snapshot in time of the consequences being felt across the country. Instead of acting boldly, our elected leaders and the Federal Reserve continue to respond with half-measures and rhetorical failures searching for where to lay the blame,” Manchin said.

The White House did not immediately issue a statement on the new inflation data, but press secretary Jen Psaki admitted at her Monday press briefing that the figure would be “extraordinarily inflated” due to the Russian invasion of Ukraine.

Biden is traveling to Iowa on Tuesday to announce that he will allow gas stations to sell gasoline that is blended with 15% ethanol rather than 10%. The White House says the change could lower prices by 10 cents per gallon, though ethanol has lower fuel efficiency. Higher ethanol blends are usually prohibited between June 1 and Sept. 15 to reduce smog during the summer. 

Although inflation jumped .6% in March, it crept higher gradually over the past year — hitting 7.9% in February after reaching 7.5% in January and 6.9% in December.

Biden in December claimed that November’s 6.8% annual inflation rate was likely the “peak.” He said in July 2021 that high inflation was “temporary” when it was around 5 percent.

Inflation is a major liability for Democrats, who control both chambers of Congress, headed into this year’s midterm elections. A poll released Sunday by CBS found that about 69% of US adults disapprove of Biden’s handling of inflation. Even among Democrats, 41% disapprove of Biden’s response.

Republicans generally blame Democrats for inflation while slamming Biden’s actions last year to halt new petroleum drilling leases on federal land and scrap the construction of new oil pipelines.

“If the Biden Administration truly wants to find the cause of record high inflation all they have to do is look in the mirror,” said Sen. Lindsey Graham (R-SC). “These dramatic, record-setting increases in inflation weren’t caused by Vladimir Putin, but by the bad choices of President Biden and the Democrats who control Congress.”

Graham added: “When they declare war on oil and gas, Americans end up with higher prices at the pump. When they spend with no end in sight, they drive up costs for average Americans and allow inflation to take a larger and larger chunk out of Americans’ hard-earned wages. When they adopt a weak foreign policy that invites the bad guys to take action, we get a troubled and dangerous world.”

In March 2021, Biden signed the $1.9 trillion American Rescue Plan Act, which bailed out state and local governments, gave $1,400 stimulus checks to most Americans, extended a $300 weekly unemployment supplement and expanded the annual child tax credit to $3,000 to $3,600 per child, up from $2,000.

Biden’s stimulus followed bipartisan legislation in 2020 that distributed about $4 trillion to businesses, individuals and state and local governments during the COVID-19 pandemic. This past November, Biden signed a $1.2 trillion bipartisan infrastructure bill that the Congressional Budget Office said would add $256 billion to the federal deficit, though Biden argued it would ultimately lower inflation by improving the transportation of goods.