Over the past few weeks, President Joe Biden has touted Bidenomics during speeches in Chicago and South Carolina. Bidenomics is the opposite of Reaganomics. It is focused on enormous federal spending, the expansion of regulations, and an increase in taxes. On his Bidenomics tour, President Biden claimed that his economic policies have made the economy better by decreasing inflation, diminishing the deficit, and creating jobs.
What about Bidenomics is true, and what is false? Play “Two Truths and a Lie” to find out!
A. Bidenomics has brought down prices.
B. Bidenomics is not primarily responsible for reducing the deficit.
C. Bidenomics does not deserve the credit for creating new jobs.
A. LIE! Bidenomics, which includes huge congressional spending and a stimulus package, is responsible for driving inflation higher, not for bringing it down. President Biden conveniently compares today’s consumer price index or CPI (inflation) to one year ago. Instead, he should compare today’s inflation rate to that of two years ago or perhaps when he took office. One year ago, CPI topped 9.1%, and today it’s 4%. However, when President Biden took office, inflation was 1.4%, even below the Federal Reserve’s target for inflation. The Fed would like CPI to be about 2% today.
B. TRUTH! Bidenomics misleadingly takes credit for reducing the deficit that would have declined if President Biden did nothing according to estimates from the Congressional Budget Office (CBO) in February 2021. The CBO explained that the deficit’s decline in 2022 was due to two primary reasons. First, government revenue or taxes increased, especially from growth in economic activity following COVID-19. Second, government expenditures or spending on temporary COVID-19-related programs decreased.
Many experts have said the vast majority of the decrease in the deficit came from 2020 COVID-19 spending that was already scheduled to end. President Biden’s policies, including the nearly $2 trillion American Rescue Plan and the extension of the student loan payment pause, made the deficit worse than it would have been.
C. TRUTH! President Biden is taking credit for jobs that returned after pandemic restrictions ended and calling them all “new” jobs. Over 70% of the jobs in 2021 were recovered jobs according to congressional analysis. The net of jobs that replaced those lost suggests that President Biden created around 4 million jobs in his first two years in office. Meanwhile, President Trump created 5 million jobs during his first two years in office.
Bottom Line:
Bidenomics is the source not the solution to high inflation. The federal deficit decreased primarily because the negative effects of COVID-19 started to end, and President Biden’s policies only made the deficit worse. President Biden’s actual job “creation” record is worse than President Trump’s record. Overall, Bidenomics has made job growth, inflation, and the deficit worse.
If you want to learn more about Bidenomics, read the fact checks below.