Grand Canyon Times

EJ Antoni, a research fellow in regional economics at The Heritage Foundation's Center for Data Analysis, said the Biden administration's policies have driven up inflation, costing the average household thousands of dollars through a combination of costs rising faster than wages and high interest rates. 

Arizona residents have been hit hard by inflation, with the average family having to spend almost $12,000 more on essential goods and services since the end of 2020.

“Although the slowdown in inflation is certainly welcome, it’s not a sign of things to come. The latest data illustrates why families cannot afford to live in Biden’s America. Under Biden, prices have risen so much faster than wages that the average family has lost $5,800 in real annual income. That loss is thanks to the ‘hidden’ tax of inflation, caused by the Biden administration and congressional Democrats’ policies," Antoni said.

A December release from The Heritage Foundation analyzing the latest consumer price index (CPI) summary found that since Biden took office, inflation rising faster than wages has cost the average American household $5,800 in real annual income, while high interest rates have cost the average family $1,300, for a combined total of $7,100. Antoni also pointed to the Biden administration’s "war on reliable American energy" as another reason for the strain on household budgets, saying that families nationwide will have to spend 16% more on heating bills this winter than last winter to stay warm.

“Higher interest rates are now costing the typical family another $1,300 annually. Combined with a lower real income, this effectively costs families a total of $7,100 in annual income under Biden. But some families are even worse off, especially if they are trying to buy a home. The monthly mortgage payment on a median priced home is up 84%, or $820, since Biden became president. That’s about $10,000 more per year and $300,000 more over 30 years for the same house," Antoni said.

Before Biden took office in January 2021, the annual inflation rate stood at 1.4%, but since then inflation has broken a 40-year high record, rising significantly faster than wages and driving many into debt, according to a December report from the Independent Women's Forum (IWF). Almost two-thirds of Americans are now living paycheck to paycheck, with many taking on credit card debt to cover the costs of necessities. Collective credit card debt in the U.S. stands at $930 billion, representing a 15% increase over the last year.

In December 2020, the average household in the Phoenix area was spending approximately $5,254 per month on necessities including groceries, housing and transportation, according to a report from the Common Sense Institute of Arizona. As of October 2022, households had to spend $6,361 to pay for the same goods and services, representing an increase of $912 per month, or a total of $11,992 over the 22-month period. Inflation in the Phoenix area was 4.4% higher than the national average between November 2021 and November 2022.

The IWF pointed to the Biden administration's fiscal policies as a driver of inflation, highlighting expanded tax credits, paused student loan payments and tax-and-spend policies. The report highlighted recent legislation that includes a 15% corporate alternative minimum tax, a $6.5 billion tax on natural gas, a $12 billion tax on crude oil and a $1.2 billion tax on coal and noted that almost one-third of corporate taxes are passed on to consumers through higher prices, citing a 2020 study by the National Bureau of Economic Research.

George Hammond, the director of the Economic and Business Research Center at the University of Arizona’s Eller College of Management, said high housing costs have contributed to the state's inflation, Cronkite News reported.  

“The major reason why Phoenix’s inflation rate is running so much faster than the national average, is what’s going on in the housing market,” he said. “Housing is by far the biggest single category in the price index, so it has a huge influence on what happens.” 

Transportation costs have also played a role, according to Economics Professor Dennis Hoffman, who said, "We’re quite a commuter region. A lot of people commute, so they pay the costs of used cars, and cars of course need gasoline.”

Beth Fiorenza, executive director of a food pantry called Nourish Phoenix, said her organization has seen a steep increase in the number of people seeking assistance in the last several months.

“If people were already living paycheck to paycheck, and then inflation and higher expenses hit, now they’re really struggling to get by every month,” Fiorenza said.