Peter Schiff Says Congress Can't Lower Prices Without Cutting Government Spending, Calls Higher Prices 'the Tax Americans Pay' for Programs 'Democrats Love'

As Democrats prepare to take control of Congress on promises of lower prices, veteran investor Peter Schiff said prices will keep rising unless they cut government spending.

Higher Prices a Tax on Americans

On Sunday, in a post on X, Schiff said Democrats claim they will “fight to lower prices,” but with the Federal Reserve “monetizing deficit spending,” prices “will keep rising” unless they cut government spending.

“Higher prices are the tax Americans pay to cover the cost of government programs Democrats love,” he added.

Democrats claim they'll fight to lower prices. But because prices rise due to the Fed monetizing deficit spending, unless Democrats cut government spending, prices will keep rising. Higher prices are the tax Americans pay to cover the cost of government programs Democrats love.

— Peter Schiff (@PeterSchiff) November 8, 2026

House Democratic Leader Hakeem Jeffries (D-N.Y.) has pledged to prioritize affordability and accountability, while others have blamed Trump’s tariffs for driving up prices.

Deficit Widens as Inflation Accelerates

The federal government ran a $1.99 trillion deficit in fiscal 2026, up $217 billion, or 12%, from $1.78 trillion in fiscal 2025, according to Treasury data.

Consumer prices rose 3.7% year over year in September, above the 3.6% economists expected, the Bureau of Labor Statistics said. Gasoline, up 9.1% on the month, accounted for more than half of the increase and is up 34.2% from a year ago.

Voters ranked the economy as their top issue in the midterms, with many worried about the cost of everything from gas to groceries to utilities.

DoubleLine Capital founder Jeffrey Gundlach said Democrats must either find a way to bring prices down quickly or hand out money to help people afford them, which he said would only add to inflation.

Inflation Report Tests the Fed’s Path

The October consumer price report, due Tuesday, is expected to show headline and core inflation softening month to month but staying stubbornly above the Fed’s 2% target year over year.

The central bank raised rates in September, its first hike since 2023, and most economists expect another increase in December, with the CME FedWatch tool showing an 80.8% probability.

Price Action: The iShares 7-10 Year Treasury Bond ETF (NASDAQ:IEF) closed 0.12% lower on Friday at $91.86 and fell 0.16% in overnight trading on Sunday. The iShares 20+ Year Treasury Bond ETF (NASDAQ:TLT) was down 0.01% on Friday, closing at $81.92, and lost 0.20% in overnight trading.

Benzinga Edge rankings indicate the 7-10 year bond ETF has a Momentum score in the 40th percentile, with a positive short-term price trend. It has a negative price trend in the medium and long term.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

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