As bad as inflation is looking here in the US, it’s currently much worse in the Eurozone where it hit a historic high in October of 10.7 percent.

Preliminary data on Monday from Europe’s statistics office showed headline inflation came in at an annual 10.7% this month. This represents the highest ever monthly reading since the euro zone’s formation. The 19-member bloc has faced higher prices, particularly on energy and food, for the past 12 months. But the increases have been accentuated by Russia’s invasion of Ukraine in late February…

Monday’s data comes after individual countries reported flash estimates last week. In Italy, headline inflation came in above analysts’ expectations at 12.8% year on year. Germany also said inflation jumped to 11.6% and in France the number reached 7.1%. The different values reflect measures taken by national governments, as well as the level of dependency that their nations have, or had, on Russian hydrocarbons…

The European Central Bank — whose primary target is to control inflation — on Thursday confirmed further rate hikes in the coming months in an attempt to bring prices down. It said in a statement that it had made “substantial progress” in normalizing rates in the region, but it “expects to raise interest rates further, to ensure the timely return of inflation to its 2% medium-term inflation target.”

As you’ve probably heard, Germany was particularly dependent on Russian gas while France was more self-sufficient because it relied on domestic nuclear power. Nearly 70% of France’s electricity generation is nuclear powered.

Thankfully we’re not as dependent on Russian oil and gas as Europe and we have a lot more nuclear power than Germany. Still, in a new opinion piece for the Washington Post, Larry Summers argues the situation doesn’t look that bright in the US at the moment.

Consider the links in this chain of macroeconomic challenges:

First, an economy that even progressives such as Paul Krugman recognize as overheated is operating with a core inflation rate that is close to 7 percent and is not yet declining — with the latest monthly figure exceeding the latest quarterly figure, which in turn exceeds the latest annual figure.

Second, the combination of the adverse effects of inflation and the adverse effects of necessary anti-inflation policies has prompted a consensus prediction of recession beginning in 2023. The most recent Federal Reserve projection suggesting that inflation can be brought down to 2 percent without unemployment rising above 4.4 percent is simply not plausible as a forecast.

Despite the very real possibility that further Fed action could drive the economy into a recession, Summers’ main message is that we have to keep going because the alternative is worse.

Questions of macroeconomic policy are not about values but judgments about the ultimate effects of various actions. As Fed chair during the early 1980s, Paul Volcker famously tamed out-of-control inflation at the cost of a severe recession. But he did so not because he cared less about unemployment or worker incomes than his predecessors did but because he rightly recognized that delay in containing inflation would only mean more pain down the road.

This principle can be seen in the current labor market. Even as job openings have risen to unprecedented levels and labor shortages have empowered workers, Americans’ real incomes have declined significantly. Unless inflation comes down, workers will not see meaningful increases in their purchasing power — and many of them will continue to doubt the government’s ability to carry out basic tasks…

Those who believe the Fed is close to having done enough need to explain their view. If they believe that interest rates above 4 percent, in an economy with 7 percent core inflation, will cause a recession serious enough to reduce inflation below the Fed’s 2 percent target, they need to explain why. I find it absurd. Perhaps the argument is that preventing an overly deep recession is so important that it’s worth abandoning the Fed’s inflation target. But proponents of this view need to explain how, if inflation remains well above 2 percent, we can avoid continued erosion in real wages down the road.

Summers gives the White House credit for not arguing with the Fed about raising rates. That may be because the White House agrees it’s necessary but I suspect the usual rules don’t apply in the two months before an election that could decide the course of the next two years of Biden’s tenure. Republicans around the country have been running against the high inflation numbers. My guess is Democrats want to say as little as possible about an issue that is hurting them with voters. Last week, NBC News published a story saying Democrat were still struggling to decide what their message on inflation should be.

“What is our message about why inflation is going to be worse if Republicans win?” Rep. Ro Khanna, D-Calif., told NBC News in an interview. “I don’t think our economic message has been loud enough or sharp enough.”

“We’ll have to message it better in the next three weeks ahead,” said House Speaker Nancy Pelosi in an interview with Punchbowl News this week, when asked about inflation…

When inflation first started creeping up in 2021, Democrats tried to downplay the issue, arguing it was a temporary — a hiccup of pandemic-related supply chain disruptions that would soon resolve itself.

Even now, party leaders are divided on whether to focus on empathizing with voters’ pain on rising prices, which risks validating the GOP message on inflation, or to focus on explanations for why they are not to blame for a complex global economic phenomenon.

“Inflation is there, but it’s global and not as bad as it is in some countries,” Pelosi said in the interview with Punchbowl News, echoing a common Democratic talking point.

Again, I think Democrats don’t see any upside in talking about this at this moment. The best they can come up with is to claim that it’s worse in Europe. That’s true but of course American voters rightly don’t care. Inflation here is bad enough that they are ready to hold it against the party in power.