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Brian Lehrer: It's The Brian Lehrer Show on WNYC. Good morning, everyone. When President Biden and former President Trump debate on Thursday night, one of the issues they're sure to be asked about, they better be asked about, is inflation, the number one issue on the minds of voters in many recent polls, even over all the social issues, all the divisive issues, all the rhetorical issues, all the other things that are important in the world, and foreign and domestic policy, inflation, generally, ranks number one in the polls given the housing affordability crisis and the cost of many other things.

While much of the media focuses this week only on questions of style as they preview the debate, which candidate will look too hot or cool, how to handle lies and personal attacks, and talking when their mics are off, and things like that, and those things do matter. History shows that voters often form impressions of candidates more from things like those than from sober policy comparisons. We think, nonetheless, that policy matters most.

We're going to do that kind of debate preview now on the central issue of inflation and affordability. Now, going into the debate, Biden has the disadvantage of inflation having spiked on his watch, whether or not it was for many of his policies, as opposed to the global effects of the pandemic, Trump has the disadvantage of low unemployment right now. If anyone's reading the economic press of his core campaign promises being widely considered as inflationary themselves, but who's noticing. We'll tell you which ones, but let's compare.

Jim Tankersley covers White House economic policy for the New York Times. His recent articles include ones called "Biden’s Stimulus Juiced the Economy, but Its Political Effects Are Muddled." One called, "C.E.O.s Are Frustrated. That Doesn’t Mean They Embrace Trump." Jim, thanks for coming on for this. Welcome back to WNYC.

Jim Tankersley: Thanks so much for having me, Brian, and I'm so excited about your framing on this. I love the idea of talking about the actual issues leading into the debate.

Brian Lehrer: That's great. By the end of this segment, I'm going to invite you to frame a question that Dana Bash or Jake Tapper, the moderators, who, I think sometimes listen to the show, they've both been guests on this show, might even hear you suggest. They might take it Jim Tankersley inflation question very seriously. We're going to invite you to do that, you can think about it before the end of the segment.

Your article, "Biden’s Stimulus Juiced the Economy, but Its Political Effects Are Muddled," you remind us, Biden created, and Congress passed the bill, called the American Rescue Plan in March of 2021. That was one of Biden's very first things in office. Break us through the haze of pandemic amnesia, which helps keep us sane, that pandemic amnesia, and remind us what was in the American Rescue Plan. There were so many things, right?

Jim Tankersley: So many things. It's important to remember where we were economically at that time. The economy had started to recover from the pandemic recession. We were adding back jobs, starting to grow again, but that growth had flatlined, and actually started to go back down a little bit, and there was real concern among economists that the nation might be dipping back toward recession. The White House crafts this plan, $1.9 trillion to basically try to finish the job of not just recovering from the recession but rocket out of it, springboard out of it. The plan has a bunch of things.

The centerpiece of it politically is a promise that Biden made in those special elections in Georgia in December of 2020. I know this was a million years ago, but those are the elections that deliver Democrats to the Senate. Biden and the candidates there promise people that they will get checks, direct checks from the government like they had earlier in the pandemic. These $1,400 per person checks go to low income and middle class people regardless of whether they've been hurt by the pandemic.

There's a whole bunch of other stuff. There's enhanced unemployment benefits. There's enhanced food stamps. There's an expanded tax credit for parents, the Child Tax Credit that doubles as an anti-poverty program for a year, so one-year program. Then there's hundreds of billions of dollars for state and local governments and school districts to help them make it through the pandemic and the coming out of it.

All these things add up to $1.9 trillion. It's a lot of money. It shoots into the economy, and economists widely agree that it helps do exactly what-- on one hand, exactly what the economists of the White House had hoped it would do, which was accelerate growth and accelerate job creation in those perilous moments of the spring of '21.

Brian Lehrer: Was it inflationary?

Jim Tankersley: Well, that's the trick. Then it also, there were warnings, even at the time from a whole bunch of economists, including some very friendly to Democrats and veterans of previous Democratic administration's economists that this was going to be too much, that you're pouring too much stimulus into the economy, especially at a time when supply chains are snarled, people can't buy everything they want. You're going to give people a lot of money, and they might not be able to spend it in the ways they want, and you could drive prices up.

Economic research shows, yes, it probably did that the rescue plan, and on top of the previous rounds of stimulus that have been signed by President Trump in 2020, and then the efforts from the Federal Reserve, depending on whose study you believe, they add a few percentage points as many as maybe a couple, as much as a few, to in the inflation rate in 2021, 2022. I think it's important to say two things. One, there's broad consensus that, yes, the ARP added to inflation.

There's also, I think in these studies, a broad consensus that it was not the primary driver of the big amount of inflation that we saw in the United States. Easy evidence of that, we can look around the world to comparable wealthy countries in Europe, and elsewhere, and see that they all had big inflation spikes around the same time that we did, and they didn't have the American Rescue Plan.

Brian Lehrer: We don't have the growth that we're having now. I love this part of your article, you compare the United States to other wealthy nations and say, as many other economics observers have also said that no other wealthy nation has experienced growth and added jobs after the pandemic the way the United States has. My question to you is, why not? Is the difference a function of Biden policy?

Jim Tankersley: It's probably a combination of Biden policy, the Federal Reserve and its effort, the Fed kept rates low for a really long time. Another potential factor the research would show, the research does show in boosting inflation, by the way. There's some differences between-- The United States was less exposed to, for example, the energy shock from the Ukraine war than the Europe was.

I think, in general, the US economy was better positioned to do well and had far more stimulative policy, and that has produced this recovery from recession that is the envy of the world. Weirdly, because Biden's approval ratings are not good on the economy, but they are better than almost any other leader in the developed world right now, a lot of Democrats think that the rescue plan is the reason why, that if he hadn't done this, sure, maybe there wouldn't have been as much inflation, but there would be way less growth and people would be even more upset because it would be harder to find a job, be harder to make money. It's a fascinating question of counterfactuals.

Brian Lehrer: That political comparison, not just the economic comparison with major countries in Europe, is so interesting for people who don't follow European politics or European economics that much in this country. You mentioned specifically that Biden, for all the media reports on relatively bad poll numbers dominating this country's reporting on him, he remains more popular than his counterparts in Britain, Germany, and France. It sounds like you have reason to believe that that has something to do with Bidenomics.

Jim Tankersley: I think it's a reasonable conclusion. If you look around the world right now, the political trend is people are very upset about the governments that were in power during the pandemic and then maybe the aftermath. It's just a bad time to be an incumbent government, no matter where you fall on the political spectrum in a big, wealthy democracies around the world.

Whether you're the conservatives in Britain who look very likely to be ousted in their election next month, or you're the centrist Macron in France, who looks like his party could be in real trouble in the snap elections he's called later in July, it doesn't really matter, you have bad poll numbers. Biden, it looks better than those leaders on a polling perspective. Again, he doesn't look good. People are not happy.

If you look historically, he has very, very scary poll numbers. If you're a Biden supporter on economic approval, if you're hoping he gets reelected, or if you're a Republican, very enticing poll numbers, because they just is not doing well on the economy, and the economy is the thing Americans say they care most about particularly prices.

It's all sort of eye of the beholder but I think the argument, which I find to be compelling enough to have written about it, is that it could have been much, much worse for Biden, and this was a real consideration that the White House economic team had when crafting the stimulus plan was, if we get this wrong and there's some inflation, yes, we'll suffer from it. If we get this wrong and there's just another recession, or really slow growth like we had coming out of the 2008 great recession and it takes a long time with prolonged unemployment, people will be even angrier. I think there's some evidence from around the world that view is at least somewhat validated.

Brian Lehrer: Listeners, what questions about inflation or the economy generally would you like to hear asked at Thursday night's Biden-Trump debate? 212-433-WNYC, 212-433-9692. What do you think as of now is better for inflation over the next four years and why, or any questions for Jim Tankersley who covers White House economic policy for the New York Times as we preview a central issue, not their debating styles, but the central issue of inflation in advance of Thursday night. 212-433-WNYC, call or text 212-433-9692.

Now before we turn to Trump, and we'll do that in a few minutes, we're assessing Biden more now. We'll assess Trump and his economic policies and how inflationary they might be coming up. The other big Biden economic bill during his term has been the one explicitly called the Inflation Reduction Act though we usually talk about it as mostly a climate policy bill. Did the Inflation Reduction Act reduce inflation?

Jim Tankersley: I think that you would be hard-pressed to make a case that the Inflation Reduction Act has had a large reduction in inflation associated with it. To be honest, it wasn't really ever anticipated that it would be. It was a name that the Democrats picked for political reasons. I think it helped bring Joe Manchin and his last vote on board. It did a couple of things that economists would consider to be good for helping with prices. One, it appears to have at least by the initial scores of the bill slightly reduced the budget deficit on balance, reducing the budget deficit at a time of higher inflation can help take some pressure off the Federal Reserve and can help bring inflation down faster.

That reduction was not big enough to really make any kind of a meaningful impact. Then it did. The White House loves to talk about some ways in which the bill did target specific prices. In particular, it included the ability for the government to negotiate with prescription drug companies on certain types of drugs that seniors get through Medicare. It has reduced those specific costs on some specific drugs. In the grand scheme of the inflation rate, that's not a big effect, and the White House doesn't even bother arguing. Otherwise, the basic argument that they make is we're helping people with costs that are important to them. Look, if you wanted a big inflation-reducing bill, this was not it. There really haven't seen any proposals for what would be a big immediate bring-down inflation bill in the Congress right now.

Brian Lehrer: I noticed that your Times Bio page says you're particularly focused on investigating the effects of the Biden Industrial Policy agenda, which is spending hundreds of billions of dollars to promote advanced domestic manufacturing and the deployment of low-emission energy technologies to fight climate change. Is that all in the context of the Inflation Reduction Act or is it more than that too?

Jim Tankersley: It's more than that. The Inflation Reduction Act obviously is an enormous industrial policy bill. I think that, but again, for political reasons, industrial Policy Act is a little less catchy. What I mean by that is it's a bill that is meant to stimulate American manufacturing and supply chains in a whole bunch of technologies that the administration considers strategic. In this case, technologies that help bring down the fossil fuel emissions that drive climate change. That's everything from electric vehicles and solar panels and wind turbines, things that are farther along the deployment scale in terms of technologies that are out there already, and then some relatively new technologies like advanced green hydrogen that's like a fuel technology that people have some hope for but that is very, very early in the process of creating an industry.

They're trying to seed all of those. There's a huge range of those technologies, and they're trying to make sure that those technologies are both developed and manufactured in the United States largely via a whole bunch of tax incentives. It's not just the IRA, we also have the CHIPS Act that Biden signed, which was a bipartisan bill, to invest in semiconductor manufacturing. Again, a strategic industry that Biden and many Republicans consider very strategic to be made in the United States. Then other advanced manufacturing type that goes in the clusters around semiconductors.

Then the last thing about Biden's policies that you would consider industrial policy is a bunch of what he is doing on trade. He's kept some of Donald Trump's tariffs on China, but he is also added-- actually he's kept all of Donald Trump's tariffs on China. He's added his own tariffs that are strategically positioned in an effort to shield electric vehicles, for example, from Chinese competition. He's pulling a bunch of different policy levers, both legislation and administrative things like tariffs in an effort to basically grow and protect certain manufacturing industries in the United States that the administration thinks are economically strategic for the decades to come.

Brian Lehrer: Here's a question from a listener via text message, since you talked about Biden's American Rescue Plan, pandemic-era stimulus bill and its impact on inflation. Listener writes, "Did the stimulus Trump passed cause inflation?" Because there was one of those in that first year of the pandemic Trump's last year in office, right?

Jim Tankersley: There's actually two. Trump signs a big stimulus early on and then there's another one that he signs in December. Remember, Republicans were kind of trying to head off the Biden arguments in Georgia about more stimulus and they wanted to do a smaller bill. They gave people some $600 checks, I think it was. This was this bipartisan second by stimulus. All of the research that I've seen about this ends up lumping in Biden's stimulus and the Trump stimulus, and quantifying effects together because it was all big borrowed money government efforts to juice the economy.

The short answer is that if you look at the economic research, yes, there's some inflation that is assigned to Trump's stimulus efforts just like Biden's. I think when you talk to economists about it the way they would talk about it in economist languages, that Biden's stimulus was the marginal difference. He did the last extra thing that maybe overfilled the cup and sent the water spilling out and that water spilled out as inflation. When you look at the actual research, it doesn't make that distinction. It lumps them together and says both the Trump and Biden stimulus efforts were inflationary.

Brian Lehrer: Another listener in the text wants to know how much you think "greedflation" is responsible for the remaining inflation in the economy. Of course, it's come way down in the last two years. The listener writes it like this, "There's very little actual inflation. The commodities prices tell the tale. What you are calling inflation is mostly price gouging and profiteering by large corporations. How do we know? They're reporting record profits. They could not do that if there was significant inflation at work."

How much do you agree with that listener, and how would you assess the math of how much so-called "greedflation," that would be companies increasing prices because they think they can get away with it because everybody will blame general inflation as a contributor?

Jim Tankersley: Well, I think, let's step back for a second, and I promise I will get to a direct answer to that question because I get asked it a lot. We're really talking about two things. One, why did we experience such high inflation that started in 2021, peaks in 2022, that really shifted price prices up, changed the price level? Most of the research really looks at that-- Again, there's some effect from government spending, there's some effect from monetary policy from the Federal Reserve trying to simulate the economy. There's a bunch of effect on things like snarled supply chains. This is like what we see by looking around the world.

It's just, hey, people could not get the items that they wanted, and the price of those things went up because of what the pandemic had done to supply chains. To varying degrees, most of all of those things have dissipated. There still are a few supply chain hiccups across the economy, but most economists don't consider them a massive driver. That's a big part of why the inflation rate is down now from a peak of above 9% to 3%, which is still higher than the Fed's target. This brings us to our second thing and the direct question of the listener which is, how much of that 3% is what you would call corporate greed, profiteering? The administration makes this case. Biden loves to make the case that companies are being greedy. The economic research on it does not support the idea that the bulk of that inflation is from high corporate profit margins. I think the easiest way to do this is to cite that the number one thing that people cite about corporate greed is grocery prices right now.

That's what makes people most angry. It is true that grocery profits are up. The White House did an analysis. White House economists who are not unbiased on this, did an analysis of the role of excess profits in grocery price inflation. They found a role, and I think it would be very fair to say that I have read several good economic studies that find a role for corporate profits in explaining current elevated inflation. They do not find it explains anywhere close to a majority of the current difference between regular, what we might expect as normal price increases, and the actual price increases right now. Maybe that reflects the fact that there was some profit-taking earlier in the pandemic when profits soared. They really did. They hit record levels under Biden early in his administration, and the growth has slowed since then.

Perhaps there are some compositional effects there. I think that the argument that right now what is the primary driver, the primary driver, the majority of the reason we are seeing elevated inflation? I have not seen good evidence in economic research that it's corporate profits, and you can't just draw a line between, oh, they have high profits and so therefore that's the inflation.

However, there are absolutely individual instances where it's true. There's absolutely cases where there is not full competition. There's a lot of cases where there's not full competition, where companies have discovered new pricing power and are exerting it, where you can call it greed or just excess profit-taking or just a historical profit-taking. I don't want to sound like I'm discounting the idea that companies have learned they can charge more, particularly in industries where there's not what we would consider a healthy amount of competition.

I think there are tons of examples of that. We're talking just like we did with the deficit and with other parts of the ARP. We're talking a broad inflation rate and what the good economic research tells us about that full scale of prices across the economy and not just in those highly concentrated industries.

Brian Lehrer: All right. We're talking about inflation as a key issue in the presidential race that Biden and Trump are sure to be asked about in some way at Thursday night's debate. We've been assessing Biden's record mostly in this respect so far. We'll go on to Trump's next and compare where they're both explicitly promising for the next four years as we stay with Jim Tankersley who covers White House economics for The Times and your calls and texts. Stay with us.

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Donald Trump: "You take a look at what's happening with inflation. That's a banana republic inflation, what we have. I think it could be as high as 50% if you add everything in, when you start adding energy prices in, when you start adding interest rates, which have gone from 2% to 9% and 10%."

Joe Biden: "I think inflation has gone slightly up. It was at 9% when I came in, and it's now down around 3%."

Brian Lehrer: Trump and Biden on the campaign trail. We're talking about inflation as a key issue in the presidential race that Biden and Trump are sure to be asked about in some way at Thursday night's debate as we try to preview the debate on substance, not just style as much of the media seems to do exclusively. That's important, too, because it does affect how voters view the candidates.

Not just that. We've been assessing Biden's record in this respect. So far we'll go on to Trump's now and compare where they're both explicitly promising for the next four years. I hope the moderators on Thursday. Hi, Jake. Hi, Dana, if you're listening both have been guests on this show. I hope they focus on plans to fight inflation, not just retrospective blame and doling that out to the two candidates.

Our guest is Jim Tankersley, who covers White House economics for The New York Times, and we're taking your calls and texts at 212-433-WNYC, 212-433-9692. Jim, we're going to go on to Trump's record now, and particularly his campaign promises and why so many people consider them very inflationary in and of themselves. Just there was a sample of what we're likely to hear at the debate or the way Trump has been campaigning with these wild exaggerations about anything having to do with Biden, 50% inflation. For you as a White House economics reporter, we haven't had 50% inflation, right?

Jim Tankersley: No. You have price level increases, and that's different from inflation. I think people confuse them, and sure you can say certain the prices of certain items are up 50% from where they were pre-pandemic. Absolutely. I also would say that in the depths of the pandemic, some prices of things fell. For example, gasoline prices got really low during the pandemic when global gasoline demand plummeted because no one was leaving the house. It depends on where you measure, depends on what exactly you're measuring. The short answer, we have not had 50% inflation under Biden.

Brian Lehrer: We'll see if he comes out with something like that in a debate context, how Biden or the moderators fact-check him. I see so many articles when I search this issue that say Trump's main campaign promises on the economy are massively inflationary, a 10% tariff on all imports, 60% on products from China, a big tax cut, a strong US dollar, and deportation of, and mostly closing the border to immigrants. How much do you agree that those four things, which are all Trump campaign promises, add up to a lot of inflation?

Jim Tankersley: First off, I think we should again, and I know I said this with Biden, too, but I think we got to talk to the start about the economic environment that the next president is going to enter. It's going to be really different from when Trump was president the first time. When Trump was president the first time, we had a couple of decade pattern of really low inflation, like basically the entire 21st century, relatively low inflation, people had gotten really used to it. It's one reason why people are so mad about it now is because we forgot how much we don't like prices going up.

Brian Lehrer: Really low interest rates, too, right?

Jim Tankersley: Really low interest rates.

Brian Lehrer: Such slow economic growth ever since 9/11, really ever since the year 2000, tech bubble burst. Slow economic growth, therefore low interest rates to try to boost economic growth and low inflation, which goes along with slow growth.

Jim Tankersley: Right. The next president is going to take off at a very different time. Best-case scenario inflation will have come back, maybe right to the fed's target, maybe just a little bit above. The interest rates will still be several percentage points higher than they were when Trump left office. Trump's policies would hit differently, I think is one way to look at it where if he does, if he extends his tax cuts and does another big round of deficit finance tax cuts, just to say he does not offset them with spending cuts or with commensurate tax increases, you really run the risk of overheating the economy again and sending inflation back up.

It probably happens much faster this time than it did last time because people's expectations about prices have changed, and it's just a thing over time is that the more people expect inflation to go up quickly, the more it actually can. I think there's a big risk from a big deficit-financed tax cut, just like there would be a big risk from a big deficit-financed spending increase.

That's one part of Trump's policy platform that he's very clear on. He wants to do a bunch of big tax cuts. Tariffs are interesting because they will almost certainly raise prices by a lot. Trump likes to argue that China is going to pay the tariffs, other countries pay the tariffs. That's not what the research shows. The research shows that consumers pay tariffs at least to a large degree, or it results temporarily in some compressed profit margins.

I think in this case, we would expect to see prices go up again. Now, economists wouldn't necessarily consider that inflation because it would be a one-time pricing increase, but prices would go up and people would be real mad about it. I think that those two in particular. There's a lot of different ways that immigrants affect the economy in the short and the long term.

If you suddenly had 20 million fewer workers in America, there would be real pressure on a type of labor market. There would also be a lot less demand. People would be buying less things. There would be some offsetting effects from that. I think it's wrong to say that it would absolutely be massively inflationary. It was also wrong to say that it wouldn't have any effect.

I think it would be an unprecedented experiment on the American economy to see which of those forces would matter more, the supply or the demand. If Trump's full economic platform came through, and in particular, if he blows up the budget deficit, I think economists generally agree that that would be very inflationary.

Brian Lehrer: Let me go down a couple of those that people may be curious about and not understand.

Jim Tankersley: Sure. Sorry about that.

Brian Lehrer: What's the strong dollar thing, not from what you just explained, but from that simple list that I read of inflationary Trump things or allegedly inflationary Trump things? What's the strong dollar part? What does Trump say and why would we not want a strong dollar? Strong dollar sounds like the powerful US on the surface of it. Since that means strong in comparison to other currencies, it would mean that it buys a lot for less from other countries, right?

Jim Tankersley: Yes. It means we're buying more imports for less in general, and it's harder for people to buy things from us. That's just the trade-off that you have with a strong dollar. I think all of this is wrapped up in trade policy, right? Trump fundamentally maybe even more than thinking about the price impacts, we should be thinking about the sum total of a strong dollar policy and a massive tariff policy. If Trump wants to make it easier for Americans to buy things from overseas but then raise the price on those things, those will have some offsetting effects. The question will be how much does that change whether we buy things from overseas at all, how much do people start saying, well, I'm not going to buy that new refrigerator from Korea.

I'm going to buy one that's made in the United States or I'm just not going to buy a new refrigerator. I'm going to just spend it out at restaurants here at home. To the degree to which you change consumption patterns and supply can't respond accordingly, you can get price increases. You also can get massive economic changes and effects. I think again prices are a big thing that people talk about when they talk about these policies that you add up. I think Trump is talking about like fundamentally trying to change the way the US economy works right now, not just on the margins. We don't entirely know what would happen there.

Brian Lehrer: Another one like that is deportation and mostly closing the border to immigrants. People want US wages to go up, and if there was a labor shortage that Trump created by closing the border and deporting a lot of people, presumably low-income Americans if an immigrant labor shortage forces employers to pay more for relatively unskilled work would be in the interest of the wages of Americans already here. Would that likely happen in your view, and why wouldn't that be on balance and economic good thing Trump supporters would argue?

Jim Tankersley: Okay, so again, I think there's offsetting effects here and the research talks a lot about both of these. They're over different time horizons. I have been talking to economists for months now about this immigration question and as they try to sort out what the effects would be. If you really did magically wave a wand and deport 20 million people, two things would happen. One, there would be a bunch of open jobs. Not all of those people work, but many of them work, and many of them work in jobs like, let's just pick a couple of examples, like construction where you suddenly would have a lot of job openings. Theoretically, if you are an American citizen who is not deported, who works in one of those industries, you are going to be more in demand and your wages would go up.

Also, there would be 20 million fewer people demanding new things to be built. They're demanding housing, demanding food. They earn and spend money, immigrants. If you remove that economic activity, you're also cooling down the economy. That has a depressing effect on wages. Now, those factors might happen. It might be that you see a big wage spike at the beginning as companies scramble to adjust which then falls as they realize they're also adjusting to much lower demand. You also could see, again, this is such an unprecedented level of removal of workers that you could see entire industries find new ways to automate employment. It is not a guarantee that every job that is currently held by an immigrant who would be deported would end up going to a native-born American.

Which brings me to my last point which is we are already at prime-age record levels or very high levels of prime-age employment in the United States, which means how many people who are of working age or actually working. If you're looking for where the workers would come in to replace some of those jobs who might be able to command higher wages, you're looking at like retirees, and maybe some people who have been really, really difficult to get into the job market in the past for whatever reason.

It's complicated. I'm not trying to punt on it, I'm just saying I've been talking to economists about it for months and months and months. There are all of these different factors at play, and I don't think we can say with certainty that it would just be as simple as those workers are going to be gone. Everybody's wages are going to go up and nothing else is going to be bad. There's a bunch of different things going on.

Brian Lehrer: One more like this, another Trump tax cut that he's promising, the one he enacted when he was president did get some credit for fueling economic and wage growth before the pandemic, and we didn't have much inflation then. Why would that be on the list?

Jim Tankersley: Look, I think that this is Trump's argument is that I did all these things, and they weren't inflationary. If you reelect me, I'm going to get things back to where they were before because that's what it was. Interest rates are going to be low and taxes are going to be lower, and there's not going to be inflation. Like I was saying before, the economic environment is totally different. The budget deficit is large. It has grown since Trump left office. It was growing while Trump was in office. Particularly during the pandemic, it blew up. There's a lot more concern among the people who care about the budget, nonpartisan people in Washington about the possibility that if you just dump another round of tax cut stimulus onto the economy as big as the one that Trump is talking about financed by deficits, that it really could blow up prices again.

It's like giving people more money, giving corporations more money, and they might go use it on things that just boost prices. Basically, it overheats the economy. I think that's the biggest argument right now about why the tax cut might be different is just we live in a very different economic time and the same policy, if you just redid the exact same size of a tax cut that Trump did in 2017, now you would be really risking a much different effect on prices.

Brian Lehrer: Gary in Summit, you're on WNYC, with Jim Tankersley, White House economics correspondent for The New York Times. Hi Gary.

Gary: Hey, guys, thanks for having me on. I'm calling to ask questions about how the Trump and Biden policy during COVID has affected inflation.

Brian Lehrer: That's very general. I think you told our screener, and I'm going to focus it on this, because we've been answering that question. Big picture, this whole segment, I believe you told our screener that you were curious about how monetary policy that is the Fed, and the hiking of interest rates has affected inflation, and, of course, it's supposed to cool inflation. Jim, just very briefly on that.

Jim Tankersley: Yes, I think the monetary policy absolutely played a real effect here. I think that the Fed even will admit that they kept interest rates low and did other measures to stimulate economic activity for a long time. That clearly has boosted growth, and it clearly has boosted prices, and it's part of this calculation of this grand mixture of fiscal policy, monetary policy, and then supply chain and other effects that all have led to the big inflation that we saw.

Brian Lehrer: Another one from a listener, this is a text. "I find it absolutely irresponsible for this program to have expert guests gloss over the real issue with regard to inflation and pretend one party is better than the other, or at least we're trying to compare the two parties, pros and cons." "The fact is," this listener writes, "that our government is borrowing or printing new dollars as a means of covering the cost of spending more than tax revenues bring in for years." Sure enough, another of your recent articles is called "U.S. Debt on Pace to Top $56 Trillion Over the Next 10 Years." Since people's eyes glaze over one big number versus another, is that a lot?

Jim Tankersley: Yes, it's a lot. I think I have written a lot about the party's contributions to the debt, and I did my own math on Trump and Biden using CBO reports. There's this new thing from the Committee for a Responsible Federal Budget in Washington. I think it is fair to say that Trump's policies are projected to add more over a 10 year-window to the debt than Biden's have been, that includes both of their pandemic response policies.

It's also fair to say that Democrats and Republicans over the last 20 years have worked together in many cases to add a lot to our debt. For example, the Bush tax cuts in 2001 were a Republican thing, but they had Democratic support, and then Barack Obama signed a law extending and making permanent many of them. It is right to say based on, in particular this new analysis that we got yesterday, that Trump's policies have added more to the debt or projected to add more to the debt over 10 years than Biden's. It's also right to say, there's not like one party that has been fiscally neutral and the other that has been fiscally irresponsible.

They both have worked to add to the debt, and that includes they've both done a lot to cut taxes which is the thing the Democrats get really mad about. Barack Obama signed an enormous tax cut. Joe Biden has cut more taxes on balance than he has raised as president. I did an analysis on this earlier this year so just a little but he has. I think it's important to remember all these things but I also think it's important to cite hard numbers, and the hard numbers tell us Trump's policies have added more to the debt than Biden's have.

Brian Lehrer: You know what I think gets left out of the national economic and market rate shows, and market-oriented shows and everything when we talk about inflation, is housing, as if it's a separate category. We have an affordable housing crisis in so much of America. I wonder if they're going to be asked on Thursday night, or if there would be any real comparison to be had as to, what are you going to do about housing inflation because that's the one that's really sucking America?

Jim Tankersley: Well, you stole my question. That was what I was going to tell you that they should ask. No, it's the thing, we talked to voters, we talked to people out in the country, and particularly younger voters in particular, but everybody is really worried about this housing market. You're worried about it if you're trying to buy in. You're worried about it if you're trying to sell and move. You're worried about it if you're renting, and you've seen your rent go up. Housing is a thorny issue that really starts on the local level.

It includes things like zoning and building, but it also includes, policies about how fast certain areas, policies about how fast rents can go up. This is a big thorny economics question, and I would love to see a very concrete thing put to President Biden about whether he has plans to increase the housing supply over the next few years, but does he think they are enough to help people right now? If not, what does he think needs to be done right now to help more people afford housing?

For former President Trump, I think it's a very similar question on that, which is, look, how are you going to help people afford housing? In a follow up, don't accept the answer if he just says, "Well, housing was more affordable when I was president." What are you specifically going to do? Because I care about these things in a way that is pretty granular, I'm interested in whether either candidate would be willing to offer an opinion on-- if they would pressure the Federal Reserve to lower interest rates in a next term. I suspect you might get different answers from the two of them there.

Brian Lehrer: That's so interesting. I stumbled into your answer to the final question that I was going to ask, but you already answered it, which was, how would you ask about any of this in Thursday night's debate if you were one of the moderators, and there it is so there we leave it with--

Jim Tankersley: Call me old-fashioned, Brian. I think the debate moderators should ask questions to help people get answers to the things that are going to help them decide who to vote for. I think this is a question that people have that's going to help them decide who to vote for.

Brian Lehrer: Oh, you're so old-fashioned. Can you just make a deep fake TikTok video or something to keep up with the times?

Jim Tankersley: I know, I'm sorry.

Brian Lehrer: Jim Tankersley, White House economics correspondent for The New York Times. Thank you so much.

Jim Tankersley: Thanks for having me.

Brian Lehrer: Listeners, by the way, in our Thursday newsletter, we have a Brian Lehrer Show newsletter that goes out on Thursday afternoons now. I plan to read some of your responses to the question. I'm going to invite you to text in with, right now. Follow up with Jim Tankersley by texting, what you would like to hear the moderators ask on Thursday night, particularly on the economy, but it can be on anything? What would you like to hear Jake Tapper and Dana Bash ask Donald Trump on Thursday that is policy-oriented? We'll put some of that in our Thursday Brian Lehrer Show newsletter, which is going to go out in the afternoon before the debate.

I'll do this one little plug, the newsletter is new and it's free, and you can sign up for it at wnyc.org/bl newsletter, wnyc.org/bl newsletter. Sign up if you want, and contribute in this way, and we'll see what our listeners favorite question is for Thursday, and publish it Thursday afternoon. Then we'll see on Thursday night if they ask it.

 

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