Peach Tree Times

With the cost of living already on the rise for Georgians in recent months, critics argue that President Joe Biden's $1.2 trillion spending bill will spike inflation rates further.

A Nov. 10 tweet by Insider Paper, which cited Bloomberg, said Atlanta was hit hardest by inflation among U.S. cities, with prices rising by 7.9%, higher than the national average of 6.2%, according to CNN. A Zero Hedge report found that inflation’s surge was driven mainly by the increased cost of energy, shelter, food, and vehicles, indicating that rising prices are occurring due to factors beyond those associated with the reopening of the economy.

Local inflation rates might be locked in an upward trajectory if the spending package progresses. Biden's infrastructure bill was recently cleared in the House, where all of Georgia's Democratic members of Congress voted in favor of the plan, while the Georgia Republicans in the delegation voted against it, according to Fox News.

Rep. Rand Paul (R-KY) stated that the social welfare package will not only affect the nation's wealthy, as has been suggested. 

“The lie that this is only about going after rich people is frankly not true and they will go after a lot of ordinary people when this thing gets passed," Paul said, according to Fox.

Americans are already seeing the value of their dollar stretched thin, particularly in the grocery store. According to Zero Hedge, the food at home index increased 5.4% over the past 12 months, as every one of the six major grocery store food group indexes rose over the period. 

The index for meats, poultry, fish, and eggs also climbed by 11.9%, with the index for beef rising 20.1% and the index for pork rising 14.%, marking the largest 12-month increase since the period ending December 1990. Other major grocery store food group indexes also rose over the last 12 months with increases ranging from 1.8% (dairy and related products) to 4.5% (nonalcoholic beverages). 

Robert Frick, a corporate economist with Navy Federal Credit Union, spoke to the seriousness of the current inflation rates, signaling alarm as the holiday season marches closer. 

"We expected inflation would get worse before it got better, but not this much worse. Particularly painful is the increase in food prices as we approach the holidays, and the rise in energy prices as we plan to travel more to family get-togethers," Frick said in an Axios report.

“However, both those increases are likely to be temporary, and the forecasts that inflation overall will drop early-to-mid-next year still seems credible,” he added.

According to CNN Business, the huge stimulus given to Americans during the height of the pandemic during the Trump administration has likely made inflation worse, because it increased savings, boosted wealth and then demand, said Rick Rieder, BlackRock's chief investment officer of global fixed income.

"Further employment gains will continue to be a major driver of continued demand strength for goods and services, and higher wages will be a story that will sustain itself for many months to come," he said, according to CNN.

According to the Bureau of Labor Statistics, the Core Personal Consumption Expenditures index rose by the highest rate on record again in September. This is the preferred measure of inflation for the Federal Reserve.

"I think we need to put a pause button on government spending [and] get inflation under control," former Treasury Secretary Steve Mnuchin said on Fox Business in light of the sustained high levels of inflation. 

Preston Byrne, a fellow and economist at the Adam Smith Institute, said official numbers from the Bureau of Labor Statistics show that “your money is now losing 1% of its value every 30 days.”