Commentary: Massive Government Spending Has Caused High Inflation Levels and a Weakening U.S. Dollar

$100 bills in rubber bands

Inflation is up 4.92 percent the past 12 months as of May, the most since July 2008’s 5.5 percent, according to data compiled by the Bureau of Labor Statistics, amid a torrent of trillions of dollars of government spending, Federal Reserve money printing and a weakening dollar combined with the continued economic rebound led by reopening businesses from the 2020 Covid lockdowns.

The past three months alone, inflation has grown at an accelerated rate of 2 percent combined. If that trend were to hold up for the rest of the year, inflation would come closer to 8 percent.

In the month of May, price jumps in fuel oil at 2.1 percent and piped gas service at 1.7 percent offset a 0.7 percent drop in gasoline prices. In addition, new car prices grew 1.6 percent. Used cars and trucks grew at 7.3 percent again after a 10 percent jump in April. Apparel jumped 1.2 percent. And transportation services grew 1.5 percent after a 2.9 percent jump in April.

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