President Biden’s latest gaffe — claiming, in a moment of confusion, that Congress had passed his student loan forgiveness plan — has provided Americans with an additional moment of clarity just before the midterm elections: It has forced the Biden administration to admit that the Inflation Reduction Act does not reduce inflation, voters’ top concern — and was never intended to do so.
In a forum with NowThis, a left-wing news site, Biden said of his student loan forgiveness plan: “You are probably aware I’ve just signed a law that’s being challenged by my Republican colleagues. … What we’ve provided for is if you went to school, if you qualified for a Pell Grant, you qualify for $20,000 in debt forgiveness. Secondly, if you don’t have one of those loans, you just get $10,000 written off. It’s passed. I got it passed by a vote or two.”
No, he didn’t. He enacted student loan forgiveness by executive fiat — unilaterally spending up to $1 trillion of taxpayers’ money in an unconstitutional assault on Congress’s power of the purse. The president of the United States is apparently completely unaware that his plan was never submitted to Congress, never received a vote and was never “signed” into law.
Put aside the obvious concerns this raises about Biden’s cognitive fitness for office. The White House could have just admitted the obvious: The president misspoke.
Instead, his staff compounded the blunder by trying to explain his fumbled words, issuing a statement claiming Biden was not confused at all. To the contrary, it said, “the President was referring to the Inflation Reduction Act, which reduced the deficit by hundreds of millions of dollars, creating room for other crucial programs.”
Please, no serious person believes that spin. But even if we did, the clarification only makes things worse. Because until recently, the White House was claiming that the Inflation Reduction Act cut the deficit by hundreds of millions of dollars in order to … reduce inflation. Now, we learn, that was apparently never the plan.
The Penn Wharton Budget Model, the Congressional Budget Office and Moody’s Analytics all found that the Inflation Reduction Act will have virtually zero impact on rising prices. But the White House insisted it would in fact bring inflation down, because the massive climate and clean-energy spending in the law was offset by even larger tax increases — which purportedly reduced the federal budget deficit by $275 billion. And, as the White house explained in a fact sheet, “reducing the deficit will help fight inflation.”
But now the White House admits that it never intended to use that money to curb inflation — the intent was to spend it.
In fact, Biden did so almost immediately after signing the Inflation Reduction Act into law. Within days, he announced his massive student loan forgiveness — a plan Penn Wharton estimates will cost between $605 billion and $1 trillion, while the nonpartisan Congressional Budget Office puts the price tag at about $400 billion. None of that is paid for. It’s all deficit spending.
So right after claiming credit for reducing the deficit by $275 billion, Biden announced a plan to unilaterally spend perhaps two or three times that amount. According to the nonpartisan Committee for a Responsible Federal Budget, that spending will “boost near-term inflation far more than the IRA will lower it,” and thus “wipe out the disinflationary benefits of the IRA.”
Now, in trying to cover up for Biden’s slip, the White House has unintentionally acknowledged that this critique is entirely correct. The administration never planned to use the $275 billion in deficit reduction to address the issue that is the biggest concern to voters; it was intended as a slush fund for spending on “other crucial programs.” So first, officials misled the American people by calling their climate spending bill the Inflation Reduction Act. Then they misled the American people about Biden’s student loan gaffe — and inadvertently admitted to their first lie.
This is the problem with serial dishonesty: It gets hard to keep your falsehoods straight.