President Biden spreads misinformation about the U.S. economy

Yesterday, President Biden said:

Each of these is misleading.

I should preface this by saying that, to some extent, that depends on what period you are referring to. As Figure 1 shows, the Consumer Price Index (CPI) rose by 13.2% from January 2021 – when President Biden was inaugurated – and September 2022. As Figure 2 shows, the rate of inflation in the year to June 2022 – 9.0% – was the highest since October 1981. But it is also true, as Figure 3 shows, that the monthly rate of increase in the CPI, which hit its highest rate since September 2005 in June 2022, 1.3%, has been lower in the three months since then.

Figure 1

Figure 2

Figure 3

The same is true for gas prices, as Figure 4 shows. Gas prices are down from their peak of $5.01 in June, but they are still 58.4% higher than when President Biden took office in January 2021.

Figure 4

But it is much harder to make this qualification for real incomes, as Figure 5 shows. Median weekly earnings, adjusted for inflation, peaked in the second quarter of 2020 and then fell steadily to the second quarter of 2022. True, again, they ticked upward in the most recent quarter, by $3, but they were still 3.2% lower than the first quarter of 2021, when President Biden took office.

Figure 5

At the weekend, the New York Times ran an article titled ‘Fearing a New Shellacking, Democrats Rush for Economic Message.’ That message seems to be ‘everything is fine’, but the data simply do not show that, however much it is misrepresented. On the three measures offered by President Biden yesterday, inflation is up, gas prices are up, and real incomes are down since he took office. Trying to convince Americans otherwise is a bold political move.