Washington (CNN)President Joe Biden claimed last Wednesday that the last five leaders of the Federal Reserve had declared that his American Jobs Plan proposal will increase economic growth.
The American Jobs Plan, which you can read about here, would spend roughly $2 trillion on infrastructure projects and other initiatives. Biden has proposed to pay for the spending by increasing the statutory corporate tax rate from 21% to 28% and to make a variety of other tax changes, including a major increase in tax enforcement against corporations.
“And, by the way, you saw — you know, the — the last five leaders of the Fed coming out and saying — what’d they say? They said, ‘Biden’s plan is going to grow the economy,'” Biden said in his Wednesday speech at the White House.
Facts First: Biden’s claim is false. As a White House official acknowledged to CNN when we sought comment on Monday, Biden was inaccurately referring to an opinion article published in the Washington Post that day by five former leaders of the Internal Revenue Service, not five former leaders of the Federal Reserve; only three past chairs of the Federal Reserve are even alive. The former IRS commissioners did not say anything about how Biden’s plan would affect economic growth. Rather, they said Biden’s proposals — including a well-funded effort to crack down on the non-payment of taxes owed — would make the tax administration system “far fairer and more effective” and “produce a great deal of revenue by reducing the enormous gap between taxes legally owed and taxes actually paid.”
Even if this was an accidental mix-up by Biden, it was a substantial mix-up. A positive economic forecast from former tax chiefs is almost certainly less likely to sound impressive to the public than a positive economic forecast from people who ran the US central bank and are among the nation’s best-known economic figures. And, again, there was no economic forecast at all in the tax chiefs’ article.
The most recent past leader of the Fed, Janet Yellen, is now Biden’s Treasury Secretary. Her predecessor, Ben Bernanke, now a distinguished fellow at the Brookings Institution think tank, said in an email to CNN on Monday: “I have not made any public remarks on the infrastructure plan, so far as I can recall.” The other living past Fed chair, Alan Greenspan, has also not weighed in on the plan; he could not immediately be reached for comment on Monday.
An exaggeration on the pay gap between CEOs and workers
Biden claimed in a speech in Louisiana on Thursday that “it used to be that a corporate CEO got paid 36 times as much as the average employee in their corporation in the Fortune 500; now, it’s 456 times.” He made a similar claim at the White House the day prior, saying that the average CEO of Fortune 500 companies now makes “over 450 times” what the average employee makes.
Facts First: Biden’s “456 times” figure was wrong based on the most recent available data, as the White House official acknowledged to CNN on Monday — though he was broadly correct that the gap between CEO pay and worker pay has skyrocketed over time. The Economic Policy Institute, a progressive think tank, found that in 2019, CEOs of the 350 US companies with the largest sales earned 320 times more than the typical worke
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