At an August 10 White House press conference, President Joe Biden marked a report that showed that the “economy had 0% inflation in the month of July,” explaining that “while the price of some things …went up last month, the price of other things went down by the same amount.”
Though Biden made sure to point out that “people are still hurting,” and that “our work is far from over,” right-wing media figures have taken this chance to suggest that what the report shows is meaningless and accuse Biden of lying, intentionally misleading people, or bragging about bringing down inflation. In reality, while 0.0% inflation in July does not erase inflation in the year leading up to it, it is fair to suggest that this report may reflect a turning point.
The consumer price index slightly declined in July, leading to a market surge
News broke on August 10 that the Consumer Price Index (CPI), a measure of the average change over time in consumer prices, slowed slightly in July to 8.5%, from 9.1% in June.
Inflation cooled in July as gas prices and airfares fell, a welcome reprieve for consumers and economic policymakers but not yet a conclusive sign that price increases are turning a corner.
The Consumer Price Index climbed 8.5 percent in the year through July, compared with 9.1 percent the prior month, a bigger slowdown than economists had projected. After stripping out food and fuel costs to get a sense of underlying price pressures, prices climbed by 5.9 percent through July, matching the previous reading. [The New York Times, 8/10/22]
Markets “surged” on Wednesday following a 0.0% months increase on the Consumer Price Index. Bloomberg’s Joe Weisenthal explained that while falling gas prices was a dominant factor, “core inflation — which excludes food and energy— also came in well below expectations (0.3% sequentially versus the 0.5% median estimate of economists).”
Markets surged yesterday after we got a 0.0% reading on month-over-month headline CPI. This was below the 0.2% that was expected, and well below the 1.3% number that we saw in the previous month. Of course, headline inflation was heavily influenced by the recent plunge in gasoline prices. However, core inflation — which excludes food and energy— also came in well below expectations (0.3% sequentially versus the 0.5% median estimate of economists). [Bloomberg, 8/11/22]
CNBC: “Stocks soar, S&P 500 hits highest level in three months after key report shows slowdown in inflation.” [CNBC, 8/10/22]
President Joe Biden noted that the CPI inflation data showed 0.0% change in July
On August 10, Biden talked about the CPI data showing 0% inflation in July, saying “people are still hurting” but “we’re setting some signs that the inflation may be beginning to moderate.”
PRESIDENT JOE BIDEN: I want to say a word about the news that came out today relative to the economy. Actually I just want to say a number. Zero. Today, we received news that our economy had 0% inflation in the month of July. Zero percent. Here’s what that means: While the price of some things go up -- went up last month, the price of other things went down by the same amount. The result, 0% inflation last month, but people are still hurting. But zero inflation last month.
Economists look at a measure of inflation that ignores food and energy prices and they call it core inflation. That’s about the lowest amount in several year -- several months. When you couple that with last week’s booming jobs report of 528,000 jobs created last month and 3.5% unemployment, it underscores the kind of economy we’ve been building. We’re seeing a stronger labor market where jobs are booming and Americans are working. And we’re seeing some signs that inflation may be beginning to moderate. [The Guardian, 8/10/22]
Analysts say Biden is right and this may reflect a turning point
Economist and author Zachary Carter: Inflation in July was zero. In a Twitter thread, Carter explains, “Inflation in July was 0. Nobody is tricking you or conning you by stating that fact.” He continues: “It is also true that prices in July 2022 were 8.5% higher than they were in July 2021. That is because prices increased between July 2021 and June 2022. Prices stopped increasing in July 2022, which is why it is correct to say inflation was zero in July 2022.” [Twitter, 8/11/22]
Slate analyst: “It’s totally acceptable to cite the one-month change in prices if you want to convey how much inflation is speeding up or slowing down in real time.” Slate’s Jordan Weissmann, while writing that Biden is “is at risk of spiking the football early” in noting that inflation was at 0.0% for the month, notes, that “You can accuse Biden of omitting context, but he isn’t lying, making things up, or violating any kind of longstanding practice by economists and journalists.” in noting that inflation was at zero for the month. [Slate, 8/10/22]
Along with critical race theory, “wokeness,” the deep state, and other recent conservative obsessions, it appears we can now add the basic language of economics to the list of things Republicans have decided to go to war on.
Take the latest round of inflation statistics. On Wednesday morning, the U.S. got its first bit of truly good news about the rising cost of living this year. The Consumer Price Index, which has been surging in recent months, remained essentially flat in July. That was largely thanks to tumbling gas prices, which canceled out rising costs elsewhere. (Technically, the index actually declined a tiny amount, but the change rounded to zero.)
Core inflation, which excludes volatile food and energy prices, and is watched closely by economists and the markets, rose at a 3.8 percent annual rate, its lowest reading since September 2021.
Now, personally, I think the president is at risk of spiking the football early here. While today’s inflation report was certainly welcome news, the month-to-month data can be erratic and reading too much into a single report can be hazardous. (I mean, trust me.) Nonetheless, everything Biden said was strictly accurate. Overall prices did not rise in July, meaning that inflation for the month was zero.
It makes sense to cite the rate of inflation from the past 12 months when you want to talk about the cost of living versus a year before, which is what most families care about. But it’s totally acceptable to cite the one-month change in prices if you want to convey how much inflation is speeding up or slowing down in real time. I’ve often done it after particularly bad reports to highlight that prices were accelerating. You can accuse Biden of omitting context, but he isn’t lying, making things up, or violating any kind of longstanding practice by economists and journalists. [Slate, 8/10/22]
Right-wing media figures argue that the inflation report showing a net zero increase in July is meaningless because it is month-to-month and could be because demand is lowering
Fox co-anchors Bill Hemmer and Dana Perino pushed back on White House economic adviser Jared Bernstein’s statement that inflation did not increase during July. Hemmer responded, “a lot of those price reductions reflect demand, too, in the economy and the consumer.” When Bernstein pointed to gas prices lowering, Hemmer pushed back saying, “So is demand. Demand is lowering, too. That's a big reason why gasoline is dropping the way it is.” The on-screen chyron during the segment stated: “Consumer prices in July up 8.5% from a year ago.” [Fox News, America’s Newsroom, 8/10/22]
Fox News White House correspondent Peter Doocy disingenuously said that “the way the White House calculates things, when pierces are 8.5% higher than this time last year, that 8.5 actually could equal zero.” He went on to say that calculating inflation month-to-month is “not the way most economists do it.” Conservative economic commentator Steve Moore later added, “The reason that gas prices are coming down is because people aren't traveling as much in their car because they can't afford the high price of gasoline.” [Fox News, Your World with Neil Cavuto, 8/10/22]
Accusations that the Biden administration is ignoring prices are still high
Fox co-host Greg Gutfeld said Biden took “a premature victory,” in his “ridiculous new talking point.” Co-host Dana Perino accused the White House of saying that “wages are up so everyone should just be happy,” while co-host Jesse Watters argued Biden’s announcement was akin to him saying, “I just gave you a black eye but oh you know the swelling is going down a little bit.” [Fox News, The Five, 8/10/22]
On Fox Business, Wall Street Journal columnist Mary O’Grady said that “they are trying to take a victory lap,” and that Biden is “not acknowledging, you know, the continuing pain for consumers.” Host Elizabeth MacDonald called it a “confusing message on inflation,” pressing that “inflation is not at zero. They mean net zero. Falling gas prices dropped it below zero. But everything else is up on everything else, especially food and groceries.” [Fox News, The Evening Edit, 8/10/22]
On Newsmax, guest host John Bachman said that he’s “not sure how the president came up with the idea of zero inflation over the past month when the food and energy prices are stripped out, and even if he shifts the focus to last week's jobs report, inflation is still not zero.” [Newsmax, The Record with Greta Van Susteren, 8/10/22]
Newsmax host Rob Schmitt said that “the Biden administration [is] desperately trying to spin today’s new inflation numbers as some kind of a win.” Congressional correspondent Kilmeny Duchardt said that “it’s a classic case, Rob, of playing politics with numbers,” adding, “There was no inflation in the month of July, but that doesn’t mean that inflation is not affecting the economy.” Schmitt went on to later claim, “CNN [is] gaslighting Americans to get them to believe that this very slight decrease in the inflation rate is something to celebrate.” [Newsmax, Rob Schmitt Tonight, 8/10/22]
Fox News anchor Harris Faulkner also criticized the announcement, saying, “I guess they haven’t been to the grocery store lately.” [Fox News, The Faulkner Focus, 8/11/22]
Newsmax’s John Bachman told his viewers: “repeat the lie enough and it becomes the truth. Now, here’s the real truth: Disregard what you hear from the White House.” Bachman continued, “Inflation, true, didn't go up last month per se, but prices, as [Sen.] Ted Cruz pointed out, are still much higher than they were last year.” [Newsmax, John Bachman Now, 8/11/22]
Claims of the Biden administration lying or intentionally misleading people
On CNBC’s Squawk Box, political strategist Frank Luntz said the announcement is “cynical. It's a destruction of the meaning of words. It's Orwellian at its worst.” [CNBC, Squawk Box, 8/10/22]
On Fox Business’ Kudlow, former Raegan economic adviser Art Laffer complained that Biden “never mentioned the month before where we had 17.8% inflation in that month” and that “he’s cherry-picking his numbers.” [Fox Business, Kudlow, 8/10/22]
In a report, Doocy claimed that Biden’s inflation claim “is not true” because “prices are not up 0% since last year,” ignoring that inflation was at a net 0.0% only for the month of July. The report further put a damper on the inflation report, pressing that some “worry about the reason for the decline” in gas prices. [Fox News, The Special Report with Bret Baier, 8/10/22]
Right-wing radio host Stu Burguiere called Biden “disingenuous” and he has “ignored the main measure” of inflation. He pressed that listeners need to “realize these idiots are going to come out here and say this all day because they think you are so stupid, you just might believe it. And they know they're lying and they're going to do it anyway.” [The Blaze, The Glenn Beck Program, 8/10/22]
Newsmax host Chris Salcedo called the administration “spin doctors.” Guest Sean Spicer, former White House press secretary and the host of Spicer & Co, added that “it is unbelievable to say zero, creating the impression that inflation is zero when it still remains at a historic 40-year high, is unbelievable.” [Newsmax, The Chris Salcedo Show, 8/10/22]
Fox News host Jesse Watters: “Today, President Biden walked up to the podium and lied to you.” [Fox News, Jesse Watters Primetime, 8/10/22]
Fox host Brian Kilmeade said that in his announcement, Biden “ignored all the price increases from last year.” While guest hosting Tucker Carlson Tonight, Kilmeade claimed, “What Joe Biden didn't tell you is that zero inflation is only from June to July of this year, he ignored all the price increases from last year — you haven't. But hey, if inflation is zero, why do we need the Inflation Reduction Act, remember that?” [Fox News, Tucker Carlson Tonight, 8/10/22]
Fox host Laura Ingraham said, “It is Orwellian, the manipulation of language when real people are suffering.” Fox Business’ Larry Kudlow later added, “This crowd is kind of making a career out of, shall we say, cognitive dissonance or fraudulent statements.” [Fox News, The Ingraham Angle, 8/10/22]
Fox correspondent Kevin Corke said, “Critics said the president doesn't understand simple math or he is gaslighting the American people.” [Fox News, Fox & Friends First, 8/11/22m]
On Fox, The Heritage Foundation’s Kevin Roberts said “Joe Biden has never let the truth get in the way of his political opinion.” [Fox News, Fox & Friends First, 8/11/22]
Fox’s Steve Doocy suggested the announcement was “lies, damn lies, and statistics,” and Kilmeade claimed Biden is “not being honest.” Co-host Ainsley Earhardt added, “They just look at the numbers and they find a number that might be appealing to them and then they run with that and they spin the story.” [Fox News, Fox & Friends, 8/11/22]
On Newsmax, co-host Katrina Szish argued that Biden’s announcement is “semantics at this point.” Her guest Republican strategist Erin Elmore agreed, accusing Biden of going on television to “brag and boast that he's lowered gas prices and that inflation is 0%,” while prices are still abnormally high. Szish later said, “They didn't take any responsibility for those numbers going up, but now to claim victory for those numbers sort of going down. Americans are not that stupid and also I think our memories are also not that short.” [Newsmax, Wake Up America, 8/11/22]
Fox Business’ Maria Bartiromo: “This is more misinformation and disinformation.” [Fox News, America’s Newsroom, 8/11/22]
Fox Business’ Stuart Varney: Biden “knows that's not strictly accurate. He knows inflation remains at high levels, but he doesn't want to admit that to voters three months before an election.” He went on to say, “We know we're getting worse off no matter what the president says.” [Fox Business, Varney & Co, 8/11/22]