In spite of the COVID-19 pandemic, the threat of Russia invading Ukraine, and a deadweight Republican Senate, President Biden managed to increase the US Gross Domestic Product (GDP) faster than any time since President Ronald Reagan was in office in 1984. Here is the good news.
The Bureau of Economic Analysis indicated on Thursday that the GDP expanded 5.7 percent in 2021. Even better, in the fourth quarter the GDP grew far beyond what economists anticipated:
‘[At] an annualized rate of 6.9% in the fourth quarter.’
The GDP third-quarter dip of 2.3 percent in the midst of the Delta variant pandemic led the economists to anticipate a lower growth rate. Still, annualized at just 2.3 percent, according to CNN Business:
‘[It was] the best quarterly performance since the third quarter of 2020 when the initial reopening boom buoyed economic growth.’
This all occurred with the supply chain bottleneck, huge product demands, and ensuing shortages bumped up prices to an uncomfortable high. And with that, inflation took off. The Personal Consumption Expenditure Price Index (PCE) has been one of the ways to determine inflation, and that grew at 3.9 percent, which Americans saw was the highest rate since 1990.
Inflation was 6.5 percent based upon the fourth-quarter PCE and it also reach a third-quarter high, one not seen since 1981.
Of course, had the two Democratic senators not voted with the Republicans and against President Biden’s Build Back Better bill, that would have done a great deal to control inflation.
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