Elon Musk commented that the video suggests “The U.S. government is actively working to undermine the American people.” Or at least the newly elected president.
In yet another example, Biden has just agreed with the American Federation of Government Employees to protect some 42,000 workers at the Social Security Administration from having to return to the office, a key issue for the Trump team as it reforms the federal workforce.
Elsewhere, if Biden wanted to help the country, he would authorize the rapid refilling of the Strategic Petroleum Reserve. He drained that store of crude oil in 2022 in the midst of roaring inflation, trying to lower gasoline prices and help Democrats in the midterm elections. When Biden took office, the reserve held 638 million barrels of oil; today the country has only 392 million barrels of emergency reserves, the lowest in 40 years. Although the reserve is up 12 percent over the past year, we are not protected against a serious price shock.
Biden is also leaving behind a portfolio of Treasury debt that is dangerously weighted toward short-term instruments. Instead of financing our recent $1.8 trillion federal budget deficit by issuing 10- and 30-year bonds, Janet Yellen has instead loaded up on two-year Treasury bills in a nakedly political effort to avoid a massive jump in mortgage rates. Writing in the New York Post, Charles Gasparino quotes Robbert van Batenburg of the well-known Bear Traps Report, who estimates that around 30 percent of all debt is now in short-term notes, compared to 15 percent in 2023. Given the enormity of the government’s borrowings, that is an almost unimaginably sharp move.
Since we have had an inverted yield curve for most of the past two years, it would have made sense to borrow long. Yellen did not, leaving her successor to navigate higher costs going forward. As Bratenburg writes, “The Treasury now faces a substantial volume of short-term debt maturing annually, which must be refinanced at significantly higher interest rates … [which] is driving a substantial increase in the government’s interest expense.”
There are so many problems facing this country. Detroit auto makers are losing billions and laying off workers thanks to Biden’s harmful electric vehicle mandates; we have millions of undocumented migrants busting blue city budgets; violent crime is higher because Democrats have undermined law enforcement; and military leaders are warning that we are running low on weapons. The Biden years have planted land mines on many fronts for the incoming Trump team.
Shamefully, rather than trying to repair the damage they’ve caused, they are racing to do more.
Liz Peek is a former partner of major bracket Wall Street firm Wertheim and Company.
