Inflation is on the mind of Americans again now that the infrastructure compromise with Republicans has fallen through and the White House and Democrats in Congress are back to promoting their $3.5 trillion infrastructure-plus package. Joe Biden is attempting to ease concerns about the spike in prices coupled with profligate government spending at this time with claims that are — well — inflated.
Earlier this week, he insisted that “nobody is suggesting there is unchecked inflation on the way” even as former Treasury Secretary Lawrence Summers observed that consumer prices are up 5.4% in the past year, adding that the Fed should stop buying mortgages when “the housing market is on fire.”
Last night at a CNN townhall, an audience member broached the subject of inflation, asking whether the president was “concerned about the higher … prices, especially as we see gasoline, automotive, and food prices increase rapidly?
Biden’s answer, which may be heard in the video that follows, begins with a contradiction of his questioner on the price of cars:
First of all, the good news is the economy is picking up significantly. It’s rational. When you think about it, the cost of an automobile is kind of back to what it was before the pandemic. We compare what the prices were for the last year in the pandemic and they are up. … [Emphasis added]
So who’s right? The woman who asked the question or Biden? According to analysts at Kelley Blue Book, “the estimated average transaction price for a light vehicle in the United States was $37,876 in 2020. New-vehicle prices increased $975 (up 2.6%) from February 2019, while falling $126 (down 0.3%) from last month.” Even with the drop in prices over the last month, a new car still costs $849 more than it did last year.