Inflation Tax

Floor Speech

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Mr. McCLINTOCK. Madam Speaker, when the Democrats passed Mr. Biden's $1.9 trillion spending spree in March, a lot of people got a lot of free money, thousands of dollars in many cases. But the bill is already coming due for that free money, and as many of us warned, it turns out that free money is very expensive.

Indeed, it turns out that the very same families most harmed by the lockdowns will be the most harmed by paying the bill for the lockdown relief. It comes to about $15,000 for an average family, and the first installment is reflected in the rising inflation sapping the purchasing power of working families.

Government cannot put a single dollar into the economy that is not first taken out of the same economy. When government spends a dollar for you, it has already decided to take a dollar from you. And it can only be taken back in three ways: from your current earnings through higher taxes, from your future earnings through borrowing, and from your savings and purchasing power through inflation. There is no other way to pay for every dollar that government spends. Inflation is the most insidious of these taxes because it silently hollows out everything that a family labors to achieve.

Anyone who has gone near a gas station or a grocery store in the last few months can now see where their relief checks came from and how they are going to be paid back. The Democrats shut down productivity with their lockdowns, and then they flooded the economy with dollars. More dollars chasing fewer goods is the classic recipe for inflation. And this is just the first installment of the bill already coming due for the left's reckless spending.

The Consumer Price Index increased 4.2 percent in April. It was 2.6 percent in March, and it is 4.2 percent now. Core inflation is already growing faster than at any time since the end of the Carter administration.

Now, what does that mean, exactly? Well, it means that if you have managed to save $100,000 for your retirement, the government has just taken out $4,200 of it because your savings are now worth that much less. Your balance hasn't declined, but its purchasing power has lost $4,200.

Check your grocery bill or your utility bill. How much more are you spending to put food on the table or heat your home? There are other bad policies at work as well--green energy, for example--but a big part of that difference is your inflation tax, paid directly from the reduced purchasing power of your money. And that is true of everything you buy.

It doesn't stop there. The Democrats are promising a massive increase in corporate taxes while assuring the gullible not to worry, that only the corporations will pay it. But corporations don't pay corporate taxes; you do. You pay them as a consumer through higher prices. You pay them as an employee through lower wages. And you pay them as an investor through lower earnings--your 401(k), for example. There is no other way that a corporate tax can be paid. And the resulting reduction in productivity will further feed their inflation tax.

The Democrats' sick joke is this: Everything that the government has handed out to your family is already being taken back from your family through higher prices, and that pain is only beginning.

What makes the Democrats think that socialism will work any better here than every other country that has tried it? It consistently produces shortages, unemployment, inflation, poverty, and malaise wherever it is imposed. And I am afraid we will continue down this dismal path until Americans awaken to the simple economic realities that the Democratic socialists have now unleashed upon our country.

In his inaugural address, Thomas Jefferson surveyed the boundless bounties of our Nation and asked: ``With all these blessings, what more is necessary to make us a happy and a prosperous people? Still one thing more, fellow citizens: a wise and frugal government, which shall restrain men from injuring one another, shall leave them otherwise free to regulate their own pursuits of industry and improvement, and shall not take from the mouth of labor the bread it has earned. This is the sum of good government.''

Madam Speaker, Americans deserve a wise and frugal government. But it is not enough to deserve it. We have to demand it at the ballot box.

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