CatholicVote: “Two economists report that after adjusting government statistics to accurately measure inflation, it became clear that the country has been in a deflationary state for the past two years under the Biden-Harris administration”

That is the topic of this article.

Heritage Foundation Research Fellow EJ Antoni and Mises Institute Fellow Peter St Onge compiled the report for the Brownstone Institute for Social and Economic Research, a civil rights think tank.

“If you adjust the government’s figures for inflation, it turns out we’ve been in recession since 2022,” St Onge wrote on X (formerly Twitter) launching the study last week.

I have disputed this argument here – in particular there is no evidence that the two authors “adjusted” the government’s inflation figures. They have provided (without documentation) some of their inflation figures. In particular, I showed that Antoni-St. Onge statistics are impossible. (There’s also the question of whether it’s appropriate to use mortgage rates and interest rates rather than some sort of rent-to-own ratio).

Figure 1: BEA GDP (orange), GDP including PCE using the Case-Shiller House Price Index – national mortgage rate factor index, using a BEA weight of 15% (green), using -30% (dark green), Antoni-St.Onge estimate (red square), all in bn.Ch.2017$ SAAR. The NBER has defined recession days as shaded in gray. Source: BEA, S&P Dow Jones, Fannie Mae via FRED, NBER, and author’s calculations.

In fact, the closest I can get to multiplying their GDP rate (and recession starting in 2022) is to assume that fast food price increases are a fair measure of inflation.

Figure 2: GDP in Ch.2017$ (bold black), using alternative consumption deflator, housing-in-PCE weights (blue), 2017 fast food$ (green), 2017 Big Macs (brown) , and in 2017% per Antoni -St.Onge (red square), all in billions. Big Mac prices are translated sequentially. The NBER has defined recession days as shaded in gray. Source: BEA, BLS, NBER, and author’s statistics.

I provide data to replicate my results here (no corresponding data available from Antoni and St. Onge).

I will conclude by noting that Dr. Antoni announced a recession in 2022H1 (based on the BEA data released at the time, but now it is not relevant due to the current data, and here), and announced that we have not left the recession in 2020 (frankly. , we have been in a situation since 2020!) .