Inflation continues to rocket higher with no end in sight. Today, the US Bureau of Labor Statistics reported that prices rose by1% in May driving the annual rate of inflation to 8.6% – a 40-year high. All prices are going up but perhaps most acutely is the price at the pump – gasoline is topping $5 a gallon in many states with expectations that it will rise further.
As most products, and many services, require gasoline for shipping and transportation, this is one area where the Biden administration should be pulling out all of the fiscal policy stops: re-starting blocked pipelines, incentives for oil and gas companies to pump for more, instead politics are getting in the way as this veers from the green at all cost approach advocated by the party in power. Unfortunately, rising energy prices hit the people most who can least afford it – not to mention the prices being paid at the local grocery store.
The Small Business & Entrepreneurship Council (SBE Council) is out with a note admonishing both President Biden and Congress asking the rhetorical question as to when the President will “stop fueling its flames.”
SBE Council president & CEO Karen Kerrigan stated:
“Policies being considered and advanced by President Biden and Congress must work to tame ravaging inflation, not fuel its flames. Higher taxes and burdensome regulation, which raise costs on businesses, work to fuel inflation. The threat of more intrusive and expensive government also restricts investment, which means entrepreneurs are impeded from being an active participant in healing the economy and helping to get our supply chains functioning normally. We are also witnessing what happens when policies punish and prevent energy development at home – higher prices with no end in sight. The costly state of the U.S. economy is not working for small businesses.”
“Hopefully there will be an end in sight when it comes to misguided policies that are increasing the pain of American families, and the pain points of small businesses. Small business owners and entrepreneurs have had to continually pivot during COVID and now ravaging inflation. It’s about time President Biden and his team pivot as well, and move away from the injurious policies that are digging the U.S. economy into a deep and dreary hole.”
Raymond Keating, SBE Council Chief Economist added:
“… policies implemented by Congress and the White House need to get refocused in a pro-growth direction. That means substantive and permanent tax and regulatory relief, opening global markets by advancing free trade, and reining in the growth in government spending.”
As markets sink and a growing number of firms announce layoffs, the Administration can do more. Otherwise, the pain will last longer than necessary harming everyone, including early-stage ventures that are already looking to reduce burn rates and conserve cash.