National Review: Inflation Is Stealing from Americans, but the Price Stability Act Can Help

The rising cost of living facing American families didn’t happen overnight. It’s the result of years of reckless government spending, monetary policy errors, and a growing willingness in Washington to treat inflation as an acceptable trade-off for short-term political gain. As a result, families across the country are paying the price at the grocery store, at the gas pump, and in their monthly utility bills.

For working Americans, inflation is a pay cut. It quietly erodes the savings, income, and financial stability that families spend years building. Every dollar loses value. Every paycheck buys less. And for families living paycheck to paycheck, the consequences are detrimental.

That is why the Price Stability Act is so critical. It reflects a basic principle of sound monetary policy: Lasting economic growth depends on stable prices and confidence in the dollar.

Since 1977, however, the Federal Reserve (the Fed) has been directed by Congress to pursue a dual mandate of maximum employment and price stability. This structure has encouraged policymakers to prioritize short-term employment goals while underestimating the long-term consequences of inflation.

But here is what many Americans do not know: The Fed admits that maximum employment is “not directly measurable and changes over time owing largely to nonmonetary factors.” Moreover, the Fed views maximum employment as “the highest level of employment that can be achieved on a sustained basis in a context of price stability.” If maximum employment depends on price stability, yet is itself not measurable, unstable, and driven by factors beyond the Fed’s control, it is unachievable.

The consequences of this approach are real, and Americans have lived through them before. The inflation crisis of the 1970s emerged from years of fiscal policy excess; the Fed delayed monetary policy action and illustrated a political reluctance to confront economic reality. Former Fed Chairman Arthur Burns later warned about the “anguish of central banking,” describing how fear of unemployment had begun to overshadow the Fed’s responsibility to preserve price stability. Today, many of those same warning signs are difficult to ignore.

The Price Stability Act would restore clarity and accountability by replacing the Fed’s dual mandate with a single, focused mission of maintaining price stability. Under this framework, the Fed would concentrate on preserving the purchasing power of the dollar and controlling inflation before it spirals out of control. This would align the United States more closely with other major central banks worldwide, including the European Central Bank, the Bank of Japan, and the Bank of England, all of which prioritize price stability as their primary mission.

Massive deficit spending creating excessive stimulus and the growing acceptance of reckless economic doctrines such as “modern monetary theory” have fueled inflationary pressures burdening American families. The notion that the government can spend or print unlimited money without consequences is unfounded and irresponsible.

Inflation is a hidden tax, and it does not tax everyone equally. It places the greatest burden on the Americans who can least afford higher costs — working families, retirees, and members of low-income communities. When the costs of groceries, rent, gasoline, and childcare rise, families are forced to make painful choices about what they can afford and what they must go without.

Some argue that replacing the dual mandate with a single price-stability mandate is anti-employment. This is incorrect and a misunderstanding of how the economy works. The Fed’s tools can prevent and fight inflation. They cannot fix structural unemployment.

Employment levels are shaped by labor demand, driven by the structure of individual economic sectors and the economy as a whole, with continual change in response to technological innovation and shifting consumer tastes. Employment levels are also affected by the decisions of Congress and the executive branch through tax policy, regulatory decisions, and government spending. Asking the Fed to chase an unachievable employment target does not help workers. It distracts the Fed from its core job.

An economy propped up by inflated prices and overly accommodative monetary policy may appear strong for a time, but that kind of growth is fragile and unsustainable. Real prosperity comes from productivity, innovation, investment, and confidence in the future — not from policies that steadily erode the value of hard work and undermine trust in the dollar.

The Price Stability Act makes clear that protecting the value of the dollar matters. It restores monetary discipline, strengthens accountability, and puts the economic interests of working families first. Most importantly, it recognizes that inflation has real consequences for real people.

For families across the United States, price stability is not optional. It is essential.