Fact Check: Treasury Downplays Biden Policies Role in Inflation
Democrats are in denial about how their policies have fueled 40-year high Biden-Flation and continue to try to pass the buck for higher prices. Worse, they are promising to make matters worse, with their plans for crippling tax hikes and more inflationary spending.
Here are a few misleading claims that were repeated during the Ways and Means Committee hearing on President Biden’s FY2023 Budget.
READ: WRAP-UP: President Biden’s Budget Proposes More Tax Increases That Cripple the Economy
READ: Brady: Under President Biden, Life is Harder for American Families and Small Businesses
FALSE CLAIM: Democrats’ $2 trillion “stimulus” only modestly contributed to inflation.
FACT: Democrats $2 trillion so-called “stimulus” prolonged unemployment and stoked inflation, despite warnings from former Obama-Biden Administration officials like former Director of the National Economic Council Larry Summers and former Chairman of the Council of Economic Advisers Jason Furman. (In fact, Furman attributes at least 2.5 percent of current inflationary pressure to the massive bill.)
- When GOP states opted to end Democrats’ lavish unemployment benefits early, more Americans joined the workforce, according to experts at the St. Louis Fed. Analysis from the San Francisco Fed also attributes Democrats’ spending to the sustained increase in inflation.
- This report echoes the findings of a similar study that found ending the unemployment benefits boosted return to work by 14 percentage points, further proof that Democrats held back our recovery by keeping workers disconnected from their jobs.
READ: Fact Check: Dems’ War on Work Raised Recession Risks & Held Back Returning to Work
FALSE CLAIM: Democrats’ expanded Child Tax Credit (CTC) cut poverty by half.
FACT: Democrats’ expanded CTC discouraged work and would ultimately harm those in poverty.
- Democrats are using a flawed study by the Poverty Center at Columbia University that is both highly speculative and assumed all eligible children were enrolled in the program.
- A University of Chicago study found the CTC expansion would lead 1.5 million workers to exit the labor force and that the decline in employment would mean “that child poverty would only fall by 22 percent and deep child poverty would not fall at all.”
READ: MYTHBUSTER: No, the Child Tax Credit Doesn’t Reduce Poverty by Half and it Discourages Work
FALSE CLAIM: Inflation is a global phenomenon.
FACT: The U.S. has higher inflation than most developed nations – and the distinguishing feature was President Biden’s so-called stimulus.
- Analysis from the San Francisco Fed shows U.S. inflation is leading the world owing largely to the “sizable fiscal support measures aimed at counteracting the economic collapse due to the COVID-19 pandemic.”
- A chart from TheRightFacts.org using Consumer Price Index (CPI) data from the Bureau of Labor Statistics shows that inflation has increased since the day President Biden took office in January 2021, and began its rise to the fastest rate in 40 years the month directly after Democrats rammed through their partisan $1.9 trillion bill (March 2021).
READ: Fact Check Biden Budget Director is Wrong — American Inflation Isn’t Just Part of a Global Trend
FALSE CLAIM: President Biden has little power to control the price of gas.
FACT: Democrats’ attack on traditional energy has worsened the energy crisis. They have proposed to raise taxes by $145 billion on Made-in-American oil and gas.
- The first step President Biden took in office was canceling the Keystone XL pipeline and freezing leases for new exploration. Most recently, the Administration has canceled oil and gas lease sales in Alaska and the Gulf of Mexico.
- The Biden Administration also drained our Strategic Petroleum Reserve (SPR) to its lowest level since 1987. And it’s not even helping.
READ: Democrats’ “War on Energy” Includes $145 Billion in Taxes on American Energy Companies, Workers, and Consumers
FALSE CLAIM: The Biden Administration’s agenda will reduce the U.S. deficit.
- The nonpartisan Congressional Budget Office (CBO) found that the Biden Administration’s agenda would increase the deficit by $3 trillion over the next decade, if Democrats follow through on their promise to make the programs permanent.
- Democrats claimed that their bill is “paid for” and “costs zero,” while at the same time advocating to make permanent many programs that expand the welfare state.