As inflation has moved to the center of the debate over President Biden’s economic agenda, a Democratic lawmaker said Thursday that it’s hitting small business in the United States particularly hard — and some won’t survive the broader economic storm caused by the pandemic.
Rep. Kweisi Mfume (D-Md.), vice chair of the House Committee on Small Business, said he believes the “temporary wave of inflation” will subside by the first quarter of next year. But he said small businesses are struggling in the meantime.
“Unlike corporations who have great reserves and oftentimes can weather a larger storm, small businesses cannot so the supply chain issues affect them disproportionately,” Mfume told The Hill’s Steve Clemons during an America’s Economic Recovery event.
According to data released by the Bureau of Labor Statistics on Nov. 10, the Consumer Price Index for rose 6.2 percent from a year earlier — the biggest 12-month gain since 1990.
“The matter of inflation, where demand outstrips supply is affecting [small businesses] and some have adjusted,” Mfume said.
“The tragedy in all of this is that a lot were lost and will never come back, but perhaps now we have a blueprint for the future to insulate small businesses,” he added.
Mfume called on the government to “remove barriers and create opportunities” to stimulate small business growth as the economy recovers from the pandemic.
Rep. David Schweikert (R-Ariz.), a member of the Joint Economic Committee, said that he’s working to make sure “microentrepreneurs” — people who are the sole employee of businesses they run out of their home — have access to the tools they need to grow their businesses.
“We’re trying to get our heads around how many small, micro businesses have started in people’s back bedroom, in their garage,” Schweikert said at the event sponsored by Wells Fargo.
“How do we make sure they have access to markets and fair capital? That’s revolutionary, that’s really healthy in an economic system,” he added.
Schweikert also echoed concerns from his fellow Republicans that Biden’s Build Back Better agenda could contribute to further inflation. The spending bill currently before the House, Schweikert said, “is going to slow down capital investments in the United States.”
“Biden’s inflation will cause the price of Thanksgiving meals & heating bills to skyrocket,” Schweikert tweeted last month.
However, Democrats have argued that boosting the economy will alleviate inflation in the long-term — and point out that the U.S. is not alone in experiencing inflation as it recovers from the pandemic.
This article was updated at 5:48 p.m.