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3. Congress Must Aid Fed Against Inflation - VERONIQUE DERUGY 091826
Published 1 month ago
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1880 IRISH AT THE EMIGRRANT SAVINGS BANK
Congress Must Aid Fed Against Inflation
Veronique de Rugy argues that the Federal Reserve cannot defeat inflation solely by raising interest rates without fiscal assistance from Congress. Higher interest rates increase national debt service payments, which have surged from $250 billion to over one trillion dollars, fueling further inflation through government borrowing. Drawing historical parallels to Paul Volcker in the 1980s, she highlights how monetary tightening requires legislative spending cuts and structural tax or Social Security reforms. With the US debt-to-GDP ratio now exceeding 100% and the Social Security trust fund facing depletion by 2032, Congress must exercise fiscal responsibility rather than relying on endless borrowing. (3)
Congress Must Aid Fed Against Inflation
Veronique de Rugy argues that the Federal Reserve cannot defeat inflation solely by raising interest rates without fiscal assistance from Congress. Higher interest rates increase national debt service payments, which have surged from $250 billion to over one trillion dollars, fueling further inflation through government borrowing. Drawing historical parallels to Paul Volcker in the 1980s, she highlights how monetary tightening requires legislative spending cuts and structural tax or Social Security reforms. With the US debt-to-GDP ratio now exceeding 100% and the Social Security trust fund facing depletion by 2032, Congress must exercise fiscal responsibility rather than relying on endless borrowing. (3)