BBB - Concerns About Inflation
A November 22 letter from Dorane Strouse presented two erroneous partisan
talking points regarding inflation and oil prices, and the Build Back Better
(B.B.B.) human infrastructure legislation currently in the Senate.
Strouse said “Biden owns inflation" by canceling the Keystone pipeline; thus, "the price of a barrel of oil has risen from $37 to $82, 121% increase." This is incorrect in two ways: First, the Keystone pipeline has been operating since 2010. The Keystone XL was a proposed extension by Trans Canada Energy to bring the planet’s most toxic fossil fuel - tar sands oil - to Cushing, Oklahoma. The cancellation of this proposed project could not cause inflation since the XL extension was never built.
And second, simply looking at two prices for a barrel of oil leads to an inaccurate and misleading conclusion. If we look at a broader picture of price action to determine the root cause of price volatility, we can see that prior to the impact of COVID, the monthly average price of crude oil was $63.65 in January 2020. As the pandemic closed down economies worldwide, the demand for oil dropped considerably bringing the price of oil down to $18.38 in April 2020. As economies started to slowly 'open up', crude oil prices started rising as demand increased. By the time President Biden took office, crude oil prices rose to $54.77 in January 2021. As of October 2021, oil prices are at $83.54. By simply comparing two figures in isolation, I could say that oil prices rose 198% under Trump, and rose only 52.5% under Biden. This, of course, would be misleading. Right? And, just to underscore the point, economists worldwide have attributed our rising inflation to the COVID-19 pandemic.
Strouse also stated that "The Biden Administration doesn't care!". That also is incorrect. President Biden has released over 50 million barrels of oil from our oil reserves in an effort to reduce or slow the rise in oil prices domestically. If this proves insufficient, Biden has stated he is prepared to release even more oil reserves.
What about the B.B.B Bill? This bill if fully funded by taxing corporations and the wealthiest 1% income earners. It will lower taxes for the middle income, and provide higher wage jobs, child
and elder care, affordable education, reduce drug costs, and more. These are services government is supposed to provide with our taxes!