Is Trump’s claim about rising prices under Biden and Harris accurate?
Former President Donald Trump has been vocal in his criticism of President Biden and Vice President Kamala Harris, particularly when it comes to the impact of inflation on American families. Trump has repeatedly mentioned a figure of $28,000, attributing this cost to the policies of the current administration.
During a rally in Las Vegas on September 13, Trump pointed fingers at Harris, accusing her of causing “the worst inflation in American history”, resulting in the $28,000 burden on the typical family. This narrative has been echoed at various other rallies across the country, including those in Wisconsin, Pennsylvania, and Arizona.
Under President Biden, inflation peaked at 9.1% in June 2022, marking the highest monthly figure in approximately 40 years. However, the situation has since improved, with inflation easing to a three-year low of 2.5% in August. It’s important to note that while lower inflation signifies a slowdown in price increases, it does not necessarily mean that prices have decreased. Household expenses, as tracked by CBS News, continue to remain higher than pre-pandemic levels.
Economists have corroborated Trump’s $28,000 estimate, acknowledging that the figure is largely accurate. However, isolating this number fails to consider the broader context that inflation has also led to income growth for many Americans. Data indicates that over the past three and a half years, a significant portion of the population has experienced a net positive increase in their financial status.
The $28,000 estimate originates from an inflation tracker created by Republicans on Congress’ Joint Economic Committee. This tracker uses data from the Bureau of Economic Analysis to monitor state-level personal consumption expenditures, reflecting expenditure patterns on goods and services. From January 2021 to July 2024, the average cumulative rise in household costs across all states and Washington, D.C., was around $27,950 due to inflation. Subsequent data for August 2024 indicated a further increase to roughly $29,000.
While experts perceive the total increase in household expenses over the past few years to be within the correct range, the exact figure may vary depending on specific metrics. Comparatively, no similar analysis on household cost changes during Trump’s administration was conducted by the Republicans on the Joint Economic Committee. Data from that era illustrates that prices did rise under Trump but by a significantly lower margin. Consumer Price Index data reveals an 8% increase in all items over Trump’s four-year term, whereas the current increase under Biden stands at about 20%.
Trump and Biden presided over distinct economic circumstances during their respective tenures in the White House. Trump’s administration witnessed low inflation and robust job growth, though the economy faced challenges towards the end of his term due to the pandemic. In contrast, Biden’s presidency was marked by high inflation following the economic fallout from the pandemic. The Federal Reserve advocates for maintaining inflation at a low, stable rate of approximately 2% year-over-year, a key tenet for a well-functioning economy.
To fully comprehend the impact of inflation on individuals’ financial well-being, economists stress the importance of comparing price increases with income growth. Data suggests that the median American household spent $905 more in August 2024 due to inflation but earned $1,073 more during the same period. Cumulatively, the Democrats on the Joint Economic Committee report that the average family saw an additional $35,390 in wages and salaries between the beginning of Biden’s term and July 2024, higher than the estimated increase in household costs recorded by their Republican counterparts.
Recent U.S. Census data also reflects a positive trend in median household income, indicating a 4% rise to $80,610 in 2023, equivalent to pre-pandemic levels when adjusted for inflation. Real disposable personal income, a metric encompassing after-tax income adjusted for inflation, has shown an uptrend under Biden compared to Trump’s final month in office. According to economist Gary Burtless, real disposable personal income per person has exceeded December 2020 levels for the majority of Biden’s term.
In conclusion, despite the challenges posed by inflation, Americans have witnessed an increase in their real incomes during President Biden’s tenure. The assertion that inflation under Biden has cost the typical U.S. family $28,000 is met with skepticism, given the overall income growth observed across the nation.
