(MILWAUKEE, W.I. ) — Speakers at the Republican National Convention this week have faulted the Biden administration for putting the nation at risk from threats that include criminals, illicit drugs — and high prices.
“American families have been crushed by inflation,” Michigan Senate candidate Mike Rogers told the audience in Milwaukee, Wisconsin, on Tuesday. Virginia Gov. Glenn Youngkin, a Republican, described the “silent creep of inflation unleashed by Joe Biden and Kamala Harris.”
Some economists who spoke to ABC News took issue with the blame placed on President Joe Biden as an overstatement of his role in the price spike. Instead, they said, the bout of rapidly rising prices emerged from a supply shortage imposed by the COVID-19 pandemic and exacerbated by the Russia-Ukraine war.
Pandemic-era spending measures enacted by former President Donald Trump and Biden also contributed to the price spike, the economists added, but they differed on the share of responsibility that should be apportioned to each of the major party candidates.
“There’s a long list of reasons for the high inflation. At the top of the list is the pandemic and the Russian war,” Mark Zandi, chief economist at Moody’s Analytics, told ABC News.
Some of the inflation owes to the $1.9 trillion American Rescue Plan signed by Biden in 2021, Zandi said. But, he added, “It’s at the bottom of the list.”
The Biden campaign did not immediately respond to a request for comment.
Price increases have slowed significantly from a peak of more than 9% in June 2022, though inflation remains a percentage point higher than the Fed’s target rate of 2%. Even after that progress made in the inflation fight, cumulative price increases during the Biden administration continue to take a toll on consumers, especially the rise in costs for essential goods like food and gas.
Like so many economic problems, inflation emerged due to an imbalance between supply and demand.
Hundreds of millions across the globe facing lockdowns replaced restaurant expenditures with online orders of couches and exercise bikes. But the demand for goods and labor far outpaced supply, as COVID-related bottlenecks slowed delivery times and infection fears kept workers on the sidelines.
“The most important factor for inflation is the recovery from the pandemic,” Jeffrey Frankel, an economist at Harvard University, told ABC News. “The process of coming back took longer than expected, in particular the supply constraints.”
To supercharge the recovery, Trump and Biden enacted economic stimulus meant to support people who’d lost their jobs or faced other financial hardship. That stimulus helped bring about a speedy economic recovery from the March 2020 downturn, triggering a surge in demand and a blitz of hiring.
With too many dollars chasing too few goods, prices skyrocketed.
“Both Trump and Biden contributed to the fiscal stimulus that fed into the inflation,” George Selgin, senior fellow and director emeritus of the Center for Monetary and Financial Alternatives at the libertarian Cato Institute, told ABC News.
Jason Furman, a professor at Harvard University and former economic adviser to President Barack Obama, estimated that Biden’s American Rescue Plan added between 1 percentage point and 4 percentage points to the inflation rate in 2021, Roll Call reported. Michael Strain, of the conservative-leaning American Enterprise Institute, estimated that the legislation added 3 percentage points to inflation.
“It was irresponsible to do stimulus when the economy was well on its way to recovery,” Peter Morici, a professor emeritus at the University of Maryland’s School of Business told ABC News, faulting Biden’s stimulus more than Trump’s because Biden’s measure came when the economy was already heating up.
“Blame is falling where it’s due,” Morici added. “Biden does bear responsibility for the endurance of Covid inflation.”
Zandi, of Moody’s Analytics, disagreed. The measure did little to raise prices but helped sustain the strong job gains and robust economic performance that followed, he said. As far as inflation goes, Zandi added, “The American Rescue Plan is a sideshow.”
Some economists who spoke to ABC News noted that price increases bedeviled countries across the globe, some of which have suffered much worse inflation than the U.S. In Argentina, inflation has surged to more than 270%; in Turkey, it exceeded 75%.
“It’s important to realize that the bout of inflation is worldwide,” Frankel said.
While Biden should avoid wholesale blame for inflation, he should also command only partial credit for its reduction, economists said. The significant slowdown of inflation over the past two years owes in large part to an aggressive series of interest rate hikes at the Federal Reserve.
Fed Chair Jerome Powell was appointed by Trump to head the central bank in 2018. Despite a tradition of independence at the Fed, Trump pressured Powell to lower interest rates the following year. Biden, for his part, has largely refrained from commenting on the actions of the Fed.
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