Maine Gov. Janet Mills, a Democrat, told college students Sunday widespread and increasing inflation of the U.S. dollar was a distraction and a Republican talking point, according to audio obtained and circulated by the Maine Republican Party.
“I watched Meet the Press this morning, and more talk about: ‘Well now Republicans have this inflation issue’ — people, it’s a distraction,” Mills told an audience at Bates College in Lewiston.
“They’re distracting people from the issues they really want to vote on when they get in office,” she said.
The audio appears to be edited, but Mills’ statement is easily heard. Neither Mills nor the Maine Democratic Party has claimed that the audio is not authentic or taken out of context.
As of this writing, none of Maine’s major newspapers have reported on the remark, although the Portland paper did take a break from opining on J6 and defending the IRS to tell readers inflation shouldn’t factor into their vote this fall.
Inflation has increased sharply over the last two years, squeezing household budgets and driving up the cost of nearly everything.
According to the Bureau of Labor Statistics’ Consumer Price Index, the price of food has increased over 10 percent from this time last year, while the price of energy has increased nearly 20 percent.
According to the CPI Inflation Calculator, $100 placed in a savings account in Jan. 2018 now has the purchasing power of $83.51.
The rise in inflation has coincided with bipartisan federal policies, nominally aimed at helping deal with COVID-19, that have increased the supply of U.S. dollars in the economy at unprecedented rates. According to economic data from the St. Louis Fed, the M2 money supply increased from $15.4 trillion in Jan. 2020 to $21.5 trillion today. The M2 money supply includes liquid cash assets, like checking account balances, savings account balances, and some money market funds.
The increased federal spending was not taken from tax collections. Instead, government financed the spending by taking on additional debt. That is, the money was conjured from thin air by the Congress, the Federal Reserve, and the U.S. Treasury Dept.
USASpending.gov, a federal website that tracks federal spending, reports that the U.S. government has committed nearly $5 trillion to COVID-19 related activities, including grants, payments, and loans to states like Maine.
In the past two years, Maine has received a tremendous amount of the new, debt-financed U.S. dollars to support a litany of government spending, from paying Mainers rent and electricity bills to paying people not to work and handing out $850 checks designed to ameliorate the harm of inflation caused by the spending.
Maine has received $8.7 billion in federal funding under 78,701 different COVID-19 programs or awards, including $3.5 billion in loans. To put those numbers in perspective, consider that state and local government in Maine collected $15.8 billion in revenue in fiscal year 2020, most of which went toward welfare programs and public education.
