Kudlow: The middle class is getting creamed by inflation

Kudlow: Biden throws wet blanket on oil, gas industry

Larry Kudlow discusses the cost of President Biden’s radical green agenda. 

Speaker Nancy Pelosi’s October 31, trick-or-treat Halloween deadline for a grand democratic deal on a trillion-dollar infrastructure package and a $5 trillion entitlement welfare state, big government socialism, orgy of massive spending, taxing, regulating and green new dealing in all likelihood is not going to be met.

There are two major reasons for this. Joe Manchin and Kyrsten Sinema. Other quieter democratic senators lurk in the back group. But they too are not happy with the massive spending bills. Senator Manchin doesn't like spending. Senator Sinema doesn't like taxing. Together, they make a lovely couple. I’d say they're the number one power couple in Washington today.

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I’m sorry Mr. Manchin will accept tax hikes. But I give him a lot of credit for his insistence that social welfare spending and entitlements must be means-tested and include workfare. These are crucial policy principles. Far-left progressives don't like them.

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But Manchin is holding strong so far. He's also done a great service in refusing to sign on to the clean electricity performance bill. That's the one that sets a target of 2035 for a carbon-free electric grid. The bill's worth about $150 billion in renewable subsidies and fossil fuel tax penalties. Of course, Manchin's from West Virginia, which produces a lot of coal, oil, and natural gas. So, I get that. But take a look around the world and you'll see what a catastrophe Biden's idea would be.

The wind stopped blowing in the north sea so the British economy is hemorrhaging with natural gas prices 8 times what Americans are paying and now they're turning to coal.  Germany is a big renewable energy country, but Putin is not providing enough natural gas for the German economy despite Nord Stream 2 and Germany’s experiment with renewables a few years ago was a catastrophe.

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So now they too, are scrambling for coal. Which at the moment is the dirtiest of the fossil fuels. The moral of the story is that wind and solar are not reliable energy sources. Oil, natural gas, and coal are reliable. In fact, coal sales in the U.S. are actually up for the first time since 2014. 

Natural gas prices were soaring. They've come off a bit, but are still very expensive.

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The oil price is over $80 a barrel. It's the middle class that's getting creamed by this inflation. And the best renewable of them all, nuclear power has been completely shot down by the greenies. So Manchin's doing everybody a favor by stopping this crazy carbon-free electric grid idea. 80% of American energy is fossil fuels.

Biden wants to stomp on it. His green new deal, regulatory threats along with tax hikes, and by the way jaw-boning banks not to make loans to fossil fuel companies have stifled fossil fuel production. We're 2 million barrels per day short of where we were pre-pandemic. That's the fossil fuel shortage. Producers don't want to invest and produce because of government policy threats. Can't blame them.

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Renewables excluding nuclear are still only 3% or so of our power. You think this is all going to change in 14 years? That's the nuttiest thing I've heard yet from the Bidens, and they put out a lot of nutty things. 

So, we all owe Joe Manchin a big favor. One other point on social spending, these unbelievable housing subsidies are under fire by Manchin and other moderates. 

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That issue is an incredible $300 billion subsidy plan that would support $90 billion for rental assistance, which is completely unnecessary because relief money for renters was never spent and the eviction rate remained very low during the pandemic.

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$80 billion to reconstruct public housing along with green new deal housing, $37 billion for the National Housing Trust Fund, and my favorite, which is a $10 billion plan that would provide a $25,000 grant to first-time homebuyers with eligibility based on minority status. 

In other words, more discrimination, more woke, and more Critical Race Theory from the far left. This is not the only program based on discrimination, but the whole lot of them is an outrage. 

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Then of course we come to the massive tax hikes and then programs to subsidize non-work and penalize work, which Casey Mulligan and Vance Ginn in the WSJ estimate could cost the economy between 5 and 9 million jobs over the next decade…Incredible. 

As far as I know, Senator Sinema is opposed to the tax hike on businesses and individuals. Good for her. So, Mr. Manchin has our back on welfare dependency, means testing, workfare and energy. Senator Sinema has our back on taxes. That's why they make such a lovely couple and I wish them well. 

This article is adapted from Larry Kudlow's opening commentary on the October 19, 2021 edition of "Kudlow."

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