Former Council of Economic Advisers Acting Chairman Tyler Goodspeed joined “Mornings with Maria” to discuss the “fiscal blowout” that took place under Biden in 2021 as the president prepares to unveil his plan to fight inflation and lower costs.
TYLER GOODSPEED: I don’t think the American people will buy it, because the two biggest reasons that everyone knows for why the deficit declined in 2021 was we had a once-in-a-century pandemic in 2020 and an appropriately large fiscal response to that pandemic. And so 2021 was coming down from that. And then the second thing was inflation. He inflated away a lot of that debt.
And look, I think to put it in perspective, just the scale of the fiscal blowout that took place in 2021 under the Biden administration in February 2021, inflation in the United States was the same over a 12-month period as in the euro area. Over the subsequent 12 months, the increase in the rate of inflation in the United States was more than five times that in the euro area. If we look at a harmonized index of consumer price inflation, what happened in March 2021, it was the American rescue plan.
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