From Formula to Fuel, Biden’s Economic Crisis

American families across the country are grappling with increasing costs and economic uncertainty. Last week, the Consumer Price Index confirmed costs of household items, energy, and services have risen by more than 8 percent, on average, over the last 12 months. Consumers are tightening their budgets, purchasing less, choosing generic groceries more, and often going without. According to an April Morning Consult survey, 61 percent of grocery shoppers said they had difficulty finding certain items.

While food costs are rising at home, the global food market also shows signs of a deepening crisis. This week—just a few days after predicting record output to international wheat markets hurt by the war in Ukraine—India reversed course to ban wheat exports, citing the country's own historic temperature highs and soaring domestic prices. In the last two months, Indonesia and Egypt have also placed substantial restrictions on agricultural exports.

The state of the global food market makes clear we must do everything possible to maximize the ability of American producers to feed the world. I am disappointed it took 16 months for President Biden to nominate a candidate to fill the role of Undersecretary for Trade and Foreign Agricultural Affairs at the United States Department of Agriculture. Earlier this year, I sent a letter to the president about this long-overdue nomination, as well as the vacancy for Chief Agricultural Negotiator in the Office of the United States Trade Representative. As American producers face the rising pressures of global uncertainty and a supply chain crisis, there is an urgent need for expertise and leadership in these roles. We cannot afford to let trade barriers to American agricultural goods stand in the way of feeding the world.

We must also take steps to address the ongoing supply chain crisis. Unfortunately, supply chain difficulties show few signs of relief, despite increasingly severe consequences for the American people. The current shortage of baby formula is one example of this. In February, the Food and Drug Administration (FDA) closed down one of the nation's top formula manufacturing plants due to a contamination scare. The closure, paired with current supply chain challenges, led to roughly 40 percent of our nation's infant formula being out of stock. Instead of acting swiftly to ensure the plant was safe, bringing manufacturing back online, addressing our broken supply chains, and using every tool at their disposal to ensure American families have access to the formula they need, the Biden administration wasted valuable time. Under public pressure, the FDA has finally come to terms with the plant on a plan to reopen. I was also pleased to see the administration take action to utilize the Defense Production Act—the same authority used by former President Trump to increase access to personal protective equipment and other supplies at the height of COVID-19—to help increase supply, but these steps should have occurred much sooner. Unfortunately, it will still be weeks before young American families will feel relief.

Additionally, farmers continue to battle obstacles to efficient production in abnormally steep prices on primary inputs such as fertilizer and energy. According to the U.S. Energy Information Administration, the average price for a gallon of diesel fuel rose nearly 40 percent during President Biden's first thirteen months in office, from $2.68 per gallon in January 2021 to $3.72 per gallon in February 2022, before increasing almost another 40 percent to $5.12 in April of this year. Meanwhile, the Biden administration is asleep at the wheel regarding domestic production opportunities and Democrats have focused their efforts on taxing oil companies, rather than improving domestic access to fuel. This week I wrote to Secretary of the Treasury Janet Yellen to express my opposition to such policies. The last so-called windfall tax on oil production was signed into law by President Carter in 1980 and resulted in an 8 percent reduction in domestic oil production and a 13 percent increase in imports of foreign oil. Less supply and higher taxes both lead to higher fuel costs.

Fuel prices are a major driver of inflation, and we cannot afford to continue down the same path. As inflation continues to outpace wage growth, it is no surprise a new poll from Pew Research found 70% of Americans view inflation as their biggest concern. We must do the hard work of promoting policies to foster economic growth, allow American industry to flourish, and pave the way for real economic recovery.