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Karl W. Smith

Joe Biden Has a Few Lessons for Gavin Newsom About Inflation

California’s governor should know that more stimulus will lead to rising prices.

San Francisco gasoline prices, June 9, 2022. 

San Francisco gasoline prices, June 9, 2022. 

Photographer: David Paul Morris/Bloomberg

The extreme inflation currently afflicting the US has multiple causes, but without a doubt one of them is the large stimulus package passed by congressional Democrats in 2021. While some economists were keen to this danger at the time, President Joe Biden can at least claim that the country was in the midst of a pandemic and he had to act despite great economic uncertainty.

No such defense is available to California Governor Gavin Newsom, who is planning further stimulus — in the form of $17 billion in tax rebates — as part of an “inflation relief package.” Newsom, like a lot of Californians, likes to say that “the future happens here first,” but in this case California has failed to learn from the US’s recent past.