Senator Manchin Urges Fed to Immediately Taper to Halt Inflation and Avoid Tax Hikes

Senator Manchin is Alarmed

I'm urging Fed Chair Jerome Powell & the Federal Open Market Committee to immediately reassess America’s stance on monetary policy & begin to taper the Fed’s ongoing stimulus in order to avoid saddling Americans w/ inflation taxes & overheating our economy https://t.co/mYXzThdZMf

— Senator Joe Manchin (@Sen_JoeManchin) August 5, 2021

Manchin's Letter to Powell (Emphasis Mine)

With the recession over and our strong economic recovery well underway, I am increasingly alarmed that the Fed continues to inject record amounts of stimulus into our economy by continuing an emergency level of quantitative easing (QE) with asset purchases of $120 billion per month of Treasury securities and mortgage backed securities. The Fed has sustained $120 billion per month in asset purchases since June 2020, despite increasing vaccination rates to combat the virus and additional fiscal stimulus from Congress in the ARP. The record amount of stimulus in the economy has led to the most inflation momentum in 30 years, and our economy has not even fully reopened yet. I am deeply concerned that the continuing stimulus put forth by the Fed, and proposal for additional fiscal stimulus, will lead to our economy overheating and to unavoidable inflation taxes that hard working Americans cannot afford. 

Simply put, our monetary and fiscal stimulus response met the moment of crisis when our economy suffered the medical equivalent of a heart attack. But, now it’s time to ensure we don’t over prescribe the patient by further stimulating an already strong recovery and therefore risk our ability to respond to future crises we are sure to face. I urge you and the other members of the Federal Open Market Committee to immediately reassess our nation’s stance of monetary policy and begin to taper your emergency stimulus response. While I appreciate your commitment to maximum employment and stable prices, it is imperative we begin to understand that long term policy responses tailored for an economic depression, like the Great Depression and Great Recession of 2008, may not be what is required for today’s economy and could result in higher than desired inflation if not removed in time. 

Those are the middle two paragraphs of Manchin's Letter to Powell.

Are You Frightened?

This is literally the most frightening thing that I’ve read since Joe Biden became president. https://t.co/L1Ln57vNir

— Ian Millhiser (@imillhiser) August 5, 2021

Some people are frightened by sanity. Others are frightened by insanity. 

Speaking of Insanity

• The Greens Hijack Biden's $3.5 Trillion Budget Proposal
• "Inflation is Half Our Mandate" and Other Amusing Quotes of the Day
• Fed's Preferred Measure of Inflation is Only 4.0%, Anyone Believe That?

Are you frightened by sanity or insanity? Or are you oblivious to what's going on?