Douglas Carr, with many charts, argues that U.S. borrowing helped fuel inflation:
Some contend that U.S. deficit policies ought not be blamed for rising inflation, given the presently high rates across the globe. To be sure, some European economies have spurred their own inflation with an ill-judged energy “transition.” Yet it is undeniably true that the U.S. dollar’s role as the world’s reference currency — with which over 40 percent of international payments are made and over 60 percent of international reserves are held — has served as a transmission mechanism for exporting U.S. inflation to the world.
Borrowing for the American Rescue Plan tipped inflation from a normal cyclical bounce to its current unacceptable pace. The initial recovery stimulus in March 2020 was record-setting in its own right and began to affect prices just as the Biden administration’s plan took deficits and inflation to a new level, in early 2021. This borrowing was eye-opening, even compared with that of advanced economies in the OECD.
Read the whole thing here.