Larry Kudlow: These climate policies would lead to a global economic and financial catastrophe

There they go again, Joe Biden and company out there on the campaign trail telling us how wonderful their economic policies have been. Wait. Scrap "wonderful." Insert "successful," fabulously successful economic policies. 

The problem is in barely more than a year Bidenomics has taken a non-inflationary boom and turned it into a high-inflation bust. Frankly, with no relief in sight at least until the cavalry comes and changes congressional policies this November, I am delighted to see my dear friends on the Wall Street Journal editorial board take Treasury Secretary Janet Yellen to task. 

She is leading the Biden economic victory tour, but unfortunately, she has supported all of the progressive big-government socialist policies coming from the far-left of the Democratic Party. 

She believes that the $2 trillion stimulus package of March 2021 was necessary to boost the economy. The trouble is the economy was already in a V-shaped recovery coming out of the pandemic, undergirded by President Trump's policies of low taxes, deregulation and open fossil fuel spigots. 

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Ms. Yellen, who is an accomplished economist and a former Fed chair and married to a distinguished Nobelist is speaking with forked tongue. Her analysis is false. Moreover, she was leading the charge along with Jay Powell and Joe Biden, which created inflationary pressures from extravagant government spending, massive government borrowing and exuberant Fed money-printing. 

These are all homegrown policies that preceded Vladimir Putin invading Ukraine. There was an 8% inflation rate caused by these huge fiscal mistakes. That is why Ms. Yellen's reputation is plunging. Personally, I hate to see it. Professionally, I have to talk about it. 

As the Wall Street Journal points out (and I've said dozens of times on this show over the past year) the Trump tax cuts increased real wages for blue-collar working folks and minorities. Unemployment rates for those groups plunged to 50-year lows. Poverty declined. Inequality declined. 

The biggest winners from the personal and business tax cuts were middle- and lower-income folks—not the top earners. These are facts. Ms. Yellen, speaking in Detroit, argues that Trump's tax cuts caused higher inequality and slower growth. She is factually wrong and she knows it. By the by, with Mr. Biden's 8% inflation rate, real worker wages have actually fallen by 3.5% over the past year. 

The first bullet in today’s White House economic blueprint fact sheet says workers are being empowered. Oops, forgot about the falling real wages and family incomes! 

They talk about making and building in America, but wait a second, you can't get a permit to make or build anything in Biden's America. His zealous environmental rules have stopped almost everything. All manner of energy and, by the way, ordinary road-building infrastructure too—can't get it past the fanatics in the White House and the EPA. 

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Rewarding work, not wealth, they say. Well, every model—government or private sector —shows Biden’s recent legislation will heavily tax the middle class and the IRS will spend its time unloading on the middle class and virtually no one in the entire American population believes the Inflation Reduction Bill will reduce inflation—virtually no one. 

I will conclude with this thought. This radical global warming, climate change obsession that informs every single policy of the Biden administration is moving the U.S. and the world economy toward an unstoppable economic decline. Hat tip to the Wall Street Journal's Joseph Sternberg for his latest column, "The Coming Global Crisis of Climate Policy." 

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There is no climate emergency. It's all a central-planning socialist fabrication, trying to jam this bureaucratic religion down our throats. Fossil fuels generate about 85% of the world's power, even after decades of government subsidies and crazy quilted regulatory plans, but what will happen if any of these climate policies for "net-zero this, or net-zero that, or we're going to take your car away from you, or we're not going to let you run your air conditioner" or literally any of these crazy policies that just want to unplug America, if any of this stuff ever truly came to pass, it would be a global economic and financial catastrophe. 

Folks, I want to go home with an optimistic frame of mind heading into the weekend. Why? Because the cavalry is coming and that's my riff. 

 This article is adapted from Larry Kudlow's opening commentary on the September 9, 2022, edition of "Kudlow."