4 Key Points on Inflation
- February 16, 2022
- Economic Policy Institute
- EPI and EARN
- The main driver of inflation today is the pandemic, which has disrupted the whole economy. The main solution is ending the pandemic.
- While worker wages have grown during the pandemic, there is no reason to believe worker wage increases are what’s driving inflation.
- There is little reason to believe too-generous government relief spending is driving inflation. The weakened economy needed it to grow in 2021, and that spending is falling sharply in 2022.
- Hopes of closing the United States’ terrible racial wage and employment gaps would be dimmed if policymakers overreact and sacrifice growth for lower inflation.