Former Vice President Mike Pence is taking a long view when it comes to inflation — a very long view that isn’t commonly expressed when debating economic performance.
Pence — well behind former President Donald Trump and Florida Gov. Ron DeSantis in early polling for the Republican nomination — is trying to position himself as the true conservative alternative in the Republican presidential race, and used inflation as a key talking point.
Pence was interviewed by Larry Kudlow, another former Trump administration official, on Fox Business, and stated the following about inflation:
“We’ve got to end this scourge of inflation on families,” he said Monday. “We’re still 16% inflation in the last two and a half years and that also means another issue I’ve been willing to tackle, Larry, is we’ve got to bring common-sense and compassionate reforms to entitlements.”
The 16% figure cited by Pence seemed to be at odds with other measures of inflation. The Labor Department reported consumer prices rose 3% year-over-year in June. The peak for the CPI series was 9%. There’s no metric — core CPI, PCE, Cleveland Fed median CPI — that got close to 16%.
The Pence campaign told MarketWatch they were comparing June 2023 with Jan. 2021 — when President Joe Biden and Vice President Kamala Harris came into office, for a 16.6% rise.
They also provided a similar comparison for inflation during the Trump/Pence administration — over those four years, prices grew by a smaller 7.7%.
But then, if that’s the new way of calculating things, there’s all sorts of data that also should be compared to 29 months ago.
To name a few: there’s been a 9% increase in jobs compared to 29 months ago, compared to the 2% drop during the Trump administration.
Average hourly earnings compared to 29 months ago have climbed 12%.
Durable-goods orders are up by 23% compared to 29 months ago, and retail sales have grown by 21%.
Comparing inflation now to 29 months ago isn’t wrong, but is misleading when the overwhelming percentage of listeners assume that comparison to be done over 12 months.
It’s an adjustment of inflation data that landed President Biden in hot water last year, when he used month-by-month data — instead of the more commonly used year-over-year data — to say that inflation was zero.
Read the full article here
