Sen. McConnell Says Americans Tightening Budgets Because of ‘Threat of Inflation’

May 26, 2021 Updated: May 26, 2021

Senate Minority Leader Mitch McConnell (R-Ky.) has been critical of the Biden administration’s spending bills, and Wednesday said American families are reacting to the increase in prices by “tightening their household budgets.”

“Ask any working family about gas prices, food prices, home prices, lumber prices, [and] used car prices. One survey just found that more than 80 percent of American families are tightening their household budgets because of the threat of inflation,” said McConnell.

McConnell has been critical of the second pandemic relief package (American Rescue Plan) that passed with no GOP support at the start of Biden’s presidency, saying that it had very little to do with relief for the pandemic and was unnecessary spending.

Judy Woodruff during a March interview with McConnell for the PBS News Hour said the Biden administration has been open about the fact that the package is about the economy, helping the unemployed, lifting about 13 million Americans out of poverty, and cutting child poverty in half.

“What I’m saying is, the economy is about to come roaring back,” replied McConnell. “What the administration is trying to do here, Judy, is to get in front of the parade so they can take credit for what’s already happening, based upon what we have already done.”

McConnell said the $1.9 trillion American Rescue Plan passed by Democrats in the House and Senate—bypassing GOP input by fast-tracking it via the Budget Reconciliation process (requires a simple majority in the Senate instead of needing 60 votes)—would hurt the economy.

“The Democrats’ hard-left turn has already hurt our economy. But they still seem to think that massive bill should only be the appetizer,” McConnell said Wednesday. “Seven trillion dollars of mediocre socialism and liberal social engineering. No serious expert thinks this is what our economy needs. No wonder Larry Summers says he’s concerned that these proposals are, quote, ‘substantially excessive … way overdoing the requisite response.’”

In addition to the $1.9 trillion pandemic relief package, Biden has two infrastructure proposals, worth about $4 trillion, which some economists have warned would trigger significant inflation. Former Treasury Secretary Larry Summers recently said he is worried that the massive spending by the Biden administration could cause inflation.

“The traditional role of the Fed is to remove the punch bowl before the party gets good, right?” Summers told Axios. “They have announced that their new policy is to remove the punch bowl only after they have clearly seen a number of people staggering around drunk.”

McConnell said that the relief payments to those who are unemployed are hurting the economy because many people are making more from unemployment so they don’t want to work, leaving many businesses unable to fill open positions.

“And what I hear from business people, hospitals, educators, everybody across the state all week is, regretfully, it’s actually more lucrative for many Kentuckians and Americans to not work than work,” McConnell said from his home state in May.

“So, we have a workforce shortage and we have rising inflation, both directly related to this recent bill that just passed,” McConnell continued.