Rising Inflation Is Fueling an Angry Backlash

The cost of goods and services is surging to new highs across the EU and US, leading to growing outrage and a possible populist backlash.

• Across Europe and the US, the signs of rapid inflation are everywhere—from soaring housing and energy costs to rising prices of wheat and sunflower oil.
• In the UK, inflation has hit a 30-year high. In Germany, it’s at the highest level since the country’s reunification. In the US, inflation hit 8.5 percent in March—a 40-year high.
• The causes are complex. Inflation was already high, but has been compounded by the War in Ukraine—which has resulted in still higher fuel costs and more supply chain disruptions.
• Although wages are also rising, they are not rising fast enough to keep up with inflation. That means, people are effectively experiencing cuts to their wages and quality of life, stoking anger.
• That anger has now become a major political issue. In France, far-right candidate Marine Le Pen has tried to capitalize on frustration with rising costs, particularly in working-class communities.
• Rising costs are also testing Europeans’ willingness to sanction Russia for the Ukraine invasion. EU states have resisted calls to ban Russian oil and gas, which would only lead to higher prices.