Conservative economic commentators are criticizing the Federal Reserve ahead of expected interest rate cuts later this month, using a slight uptick in one inflation measurement to renew their campaign to bully Fed policy makers.
On December 11, the Bureau of Labor Statistics released its monthly update of the consumer price index, which showed a slight uptick of 0.3% in November and a 2.7% rate of inflation over the past 12 months. The CPI measurement was in line with economists’ expectations and is yet more evidence that inflation has stabilized far below its previous peak of around 9% in mid-2022.
The stable inflation picture is likely to result in another Federal Reserve interest rate cut when monetary policymakers meet next week, but conservative economic commentators are using the marginal inflation uptick to renew their criticism of the Fed for its previous decision to begin reducing interest rates.
Meanwhile, prominent economists have explained that the Fed should have been cutting rates much earlier than it did.
Conservative economic commentators warn against future rate cuts
- Fox Business anchor Maria Bartiromo: “I assume if the Federal Reserve keeps on this string of rate cuts, it’s only going to flame the fires more because we are expecting growth to be taking precedence next year.” [Fox Business, Mornings with Maria Bartiromo, 12/11/24]
- CNBC host Joe Kernan asked if “it’s crazy to be cutting here.” CNBC editor Rick Santelli agreed: “I do think it is crazy to be cutting.” He continued: “The Fed has a bias. Whether they admit it or not, they want to lower rates. The market isn't giving them any justification to do so.” [CNBC, Squawk Box, 12/11/24]
- Fox Business host Stuart Varney: After next week’s expected Fed rate cut, “you’d better not have another uptick in inflation in December, January, February, because that would be bad news.” [Fox Business, Varney & Co., 12/11/24]
- On Newsmax, Heritage Foundation’s Joel Griffith said: “The Federal Reserve should be pausing these cuts. In fact they should have never embarked on these interest rate cuts in the first place.” He continued: “We have inflation that is near twice what the Federal Reserve has targeted. And yet now the Fed is loosening their monetary policy. This is a big mistake, and we're still paying for the errors of several years ago when we printed trillions of dollars. The problem is that every dollar that's deposited at a bank can multiply to $10 once it's lent out, and with the Fed lowering rates, it's encouraging people to borrow more. The money is multiplying. So the Fed has committed a gross error here.” [Newsmax, The National Report, 12/11/24]
Right-wing media previously tried to bully the Fed away from cutting rates
- Trump and his allies warned the Fed against cutting interest rates prior to the election. The Wall Street Journal reported that in a June Bloomberg Businessweek interview, Trump said Fed officials “know they shouldn’t be” cutting interest rates before the election. The story also quoted Michael Faulkender, chief economist at the Trump-aligned America First Policy Institute, who “said starting a rate-reduction campaign before the election would tarnish the Fed’s credibility.” [The Wall Street Journal, 7/31/24]
- Fox Business host and former Trump adviser Larry Kudlow led this charge, repeatedly claiming that any Fed rate cuts before the election would be political. Kudlow made these claims in January, March, April, and May. [Media Matters, 8/28/24]
- Multiple other right-wing media personalities accused the Fed of playing politics by cutting interest rates, both before and after the rate cuts were enacted. [Media Matters, 8/28/24, 9/19/24]