The Independent View: Biden’s claims

(Editor’s note: This is the first of a two-part series).

A fellow columnist recently mentioned the Biden Administration had nothing to do with the rising cost of gas. In the first few days of his occupying the White House President Biden issued executive orders canceling the Keystone Pipeline and reviewing all government oil leases to try to eliminate them. He later sold millions of barrels of Oil from the federal emergency stockpile to foreign nations and then entered into offshore oil leases to foreign nations. Now any first year economics student knows this will affect the supply and demand of Oil.

CNN published the following: President Joe Biden delivered a speech to hail economic progress during his administration and to attack congressional Republicans for their proposals on the economy and the social safety net. Some of Biden’s claims in the speech were false, misleading or lacking critical context, though others were correct. Here’s a breakdown of claims CNN fact-checked.

INFRASTRUCTURE PROJECTS

Touting the bipartisan infrastructure law he signed in 2021, Biden said, “Last year, we funded 700,000 major construction projects — 700,000 all across America. From highways to airports to bridges to tunnels to broadband.”

Facts First: Biden’s “700,000” figure is wildly inaccurate; it adds an extra two zeros to the correct figure Biden used in a speech last week and the White House has also used before: to say 7,000 rather than 700,000.

A CAP ON SENIORS’ DRUG SPENDING

Biden said, “Well, here’s the deal: I put a — we put a cap, and it’s now in effect — now in effect, as of January 1 — of $2,000 a year on prescription drug costs for seniors.”

Facts First: Biden’s claims that this cap is now in effect and that it came into effect on January 1 are false. The $2,000 annual cap contained in the Inflation Reduction Act that Biden signed last year — on Medicare Part D enrollees’ out-of-pocket spending on covered prescription drugs — takes effect in 2025. The maximum may be higher than $2,000 in subsequent years, since it is tied to Medicare Part D’s per capita costs.

VACCINATIONS UNDER TRUMP

Criticizing former President Donald Trump over his handling of the COVID-19 pandemic, Biden said, “Back then, only 3.5 million people had been — even had their first vaccination, because the other guy and the other team didn’t think it mattered a whole lot.”

Facts First: Biden is free to criticize Trump’s vaccine rollout, but his “only 3.5 million” figure is misleading at best. As of the day Trump left office in January 2021, about 19 million people had received a first shot of a COVID-19 vaccine, according to figures published by the Centers for Disease Control and Prevention. The “3.5 million” figure Biden cited is, in reality, the number of people at the time who had received two shots to complete their primary vaccination series.

Someone could perhaps try to argue that completing a primary series is what Biden meant by “had their first vaccination” – but he used a different term, “fully vaccinated,” to refer to the roughly 230 million people in that very same group today. His contrasting language made it sound like there are 230 million people with at least two shots today versus 3.5 million people with just one shot when he took office. That isn’t true.

BILLIONAIRES AND TAXES

Biden said Republicans want to cut taxes for billionaires, “who pay virtually only 3 percent of their income now – 3 percent, they pay.”

Facts First: Biden’s “3 percent” claim is incorrect. For the second time in less than a week, Biden inaccurately described a 2021 finding from economists in his administration the wealthiest 400 billionaire families paid an average of 8.2 percent of their income in federal individual income taxes between 2010 and 2018; after CNN inquired about Biden’s “3 percent” claim on Thursday, the White House published a corrected official transcript that uses “8 percent” instead. Also, it’s important to note even that 8 percent number is contested, since it’s an alternative calculation that includes unrealized capital gains that are not treated as taxable income under federal law.

IMPACT OF NEW CORPORATE TAX

Biden cited a 2021 report from the Institute on Taxation and Economic Policy think tank that found 55 of the country’s largest corporations had made $40 billion in profit in their previous fiscal year but not paid any federal corporate income taxes. Before touting the 15 percent alternative corporate minimum tax he signed into law in last year’s Inflation Reduction Act, Biden said, “The days are over when corporations are paying zero in federal taxes.”

Facts First: Biden exaggerated. The new minimum tax will reduce the number of companies that don’t pay any federal taxes, but it’s not true that the days of companies paying zero are “over.” That’s because the minimum tax, on the “book income” companies report to investors, only applies to companies with at least $1 billion in average annual income. According to the Institute on Taxation and Economic Policy, only 14 of the companies on its 2021 list of 55 nonpayers reported having U.S. pre-tax income of at least $1 billion. In other words, there will clearly still be some large and profitable corporations paying no federal income tax even after the minimum tax takes effect this year. The exact number isn’t yet known.

BIDEN AND FEDERAL DEFICIT

Noting the big increase in the federal debt under Trump, Biden said that his administration has taken a “different path” and boasted: “As a result, the last two years — my administration — we cut the deficit by $1.7 trillion, the largest reduction in debt in American history.”

Facts First: Biden’s boast leaves out important context. It is true that the federal deficit fell by a total of $1.7 trillion under Biden in the 2021 and 2022 fiscal years, including a record $1.4 trillion drop in 2022 — but it is highly questionable how much credit Biden deserves for this reduction. Biden did not mention that the primary reason the deficit fell so substantially was that it had skyrocketed to a record high under Trump in 2020 because of bipartisan emergency pandemic relief spending, then fell as expected as the spending expired as planned. Independent analysts say Biden’s own actions, including his laws and executive orders, have had the overall effect of adding to current and projected future deficits, not reducing those deficits.

BUSINESS APPLICATIONS

Biden said, “And over the last two years, more than 10 million people have applied to start a small business. That’s more than any two years in all of recorded American history.”

Facts First: This is true. There were about 5.4 million business applications in 2021, the highest since 2005 (the first year for which the federal government released this data for a full year), and about 5.1 million business applications in 2022.

Trump’s last full year in office, 2020, also set a then-record for total and high-propensity applications. There are various reasons for the pandemic-era boom in entrepreneurship, which began after millions of Americans lost their jobs in early 2020. Among them: some newly unemployed workers seized the moment to start their own enterprises; Americans had extra money from stimulus bills signed by Trump and Biden; interest rates were particularly low until a series of rate hikes that began in the spring of 2022.