February inflation numbers were lower than predicted. Don’t celebrate until you hear why.
February’s inflation numbers came in lower than expected, a fact the Trump White House is eager to tout, “Today’s CPI report shows inflation is declining and the economy is moving in the right direction under President Trump.” The New York Times lede echoed Trump’s preferred language: “Inflation eased more than expected in February, a welcome sign for the Federal Reserve.”
Indeed the Trump administration deserves ample credit for their unique role in lowering inflation beyond expectations, but it’s not for reasons they should be publicizing. Who in particular deserves credit? Secretary of Transportation Sean Duffy and Elon Musk, who have significantly decreased national confidence in airline safety.
What does the gutting of the Federal Aviation Administration have to do with inflation? To understand, just look at the consumer price index for February, which found that household essentials like eggs had significant price increases last month. The New York Times explains the greater than expected drop in inflation to be a result of another factor: flights. “A 4 percent drop in airfares in February was a primary driver of the better-than-expected data.” The reason for this? Airline disasters shaking consumer desire to fly.
January’s fatal crash at Reagan National Airport in January and a Delta flight ending up upside-down in Toronto led to a serious decline in bookings, as CNN reported. Delta’s CEO said “We saw a pretty immediate stall in both corporate travel and bookings” in the wake of the disasters.
The crash at Reagan resulted in the deaths of 67, among them the DC region’s most promising figure skaters who were returning from the U.S. Figure Skating Championships. It was the deadliest airline disaster in the United States since 2001.
This decrease in demand for flights is at least partially to blame for the unexpected price declines that resulted in the CPI as a whole having lower than expected numbers. Any media coverage of the CPI needs to include this crucial information.
So when the Trump White House celebrates their lower-than-expected inflation numbers, give them credit. Just make sure to point out how much fear and how many human lives it cost to achieve them.