Fact-Checking Biden on Inflation and Infrastructure

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President Joe Biden delivers remarks on voting rights in a speech at National Constitution Center in Philadelphia, Pa., July 13, 2021. (Leah Millis/Reuters)

Biden last night at the CNN Town Hall:

No, look, here’s the deal: Moody’s, today, went out — a Wall Street firm, not some liberal think tank — said if we passed the other two things I’m trying to get done, we will, in fact, reduce inflation.  Reduce inflation.  Reduce inflation — because we’re going to be providing good opportunities and jobs for people who, in fact, are going to be reinvesting that money back into all the things we’re talking about, driving down prices, not raising prices.

That’s not what Moody’s said. Here’s how its report accurately summarizes its actual conclusion about the effect of this federal spending on inflation: “Worries that the plan will ignite undesirably high inflation and an overheating economy are overdone.” It also says that these worries “cannot be dismissed.”

At no point does the report suggest that passing Biden’s spending plans will “reduce inflation,” no matter how many times Biden repeats the false claim.

Update: Jim Tankersley points out that the report also says that “much of the additional fiscal support being considered is designed to lift the economy’s longer-term growth potential and ease inflation pressures,” which is of course different from a conclusion by Moody’s that Biden’s spending plan will reduce inflation. Moody’s does not, in the report, attempt to estimate the trajectory of inflation with and without the spending.

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