On Friday, the U.S. House of Representatives passed a $1.7 trillion spending bill with a vote of 225-201. The bill had previously been approved by the Senate and is now headed to President Biden’s desk for his signature.
The passage of this spending bill is controversial, as it comes at a time when inflation is at a 40-year high. Approximately 40% of Americans report that they are having a more difficult time paying their bills than they did last year. More than a third of working families are unable to afford basic necessities. Inflation occurs when there is too much money in circulation, leading to a decrease in the value of the dollar. When the value of the dollar decreases, it becomes more challenging for people to afford goods and services, as prices tend to rise but incomes are not catching up.
If you are an American who is struggling to make ends meet, the recent spending bill passed by the House and Senate may feel like another blow. The $1.7 trillion spending bill will add even more money to the economy, potentially exacerbating the problem of inflation. This could be especially problematic for those who are already experiencing financial hardships, as they will be able to afford even less as the value of the dollar continues to decline.
On Tuesday, President Biden stated that he believes that prices will return to normal by the end of next year. However, this goal may be more difficult to achieve if Congress continues to pass large spending bills that inject more currency into the economy.
It is important for individuals to be aware of the potential impacts of inflation and to plan accordingly. Therefore, it may be wise to stock up on things you might need in the future because products may become more expensive.