Fact check: President Biden visits NC to talk about inflation, economic agenda
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VinFast in NC
Vietnamese automaker VinFast announced in March 2022 that it would open an electric vehicle assembly plant in North Carolina. The battery manufacturing plant will be built in Chatham County and is expected to eventually create 7,500 jobs. It’s the largest economic development announcement in the state’s history. Here is coverage from The News & Observer about the plans.
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President Joe Biden visited North Carolina A&T University Thursday to discuss his administration’s economic agenda as part of the “Building a Better America” campaign.
He addressed the nation’s rising inflation and claimed the area’s economic gains as evidence of his administration’s policies in action.
News & Observer reporters covered Biden’s remarks Thursday afternoon from A&T’s Alumni-Foundation Event Center, providing live updates and fact-checking the president’s claims.
Here were some of Biden’s major talking points:
Who deserves credit for economic growth?
The claim: Biden credited N.C. Gov. Roy Cooper for North Carolina adding nearly 200,000 jobs during his time as governor. He also bragged on his own administration for helping blue collar factory workers, saying 2021 “was the best year in U.S. manufacturing in the last 30 years” after that industry alone added a whopping 365,000 new jobs.
Fact: Biden’s numbers are correct. North Carolina has 4.8 million workers today, up from 4.6 million in early 2017 when Cooper was sworn in. And looking nationally, the manufacturing industry had its best year for job growth since the early 1990s, adding those 365,000 jobs Biden mentioned. So he’s certainly correct that the economy is growing.
But there is always context lacking when politicians give all the credit (or blame) for economic stats to one person or decision.
Manufacturing, for instance, saw such strong job growth last year largely because the industry had lost hundreds of thousands of jobs during the COVID-19 pandemic under Republican President Donald Trump, and employment is now returning to pre-pandemic levels, according to the National Association of Manufacturers.
And in North Carolina specifically, Cooper can claim some credit for job growth by championing, for example, hundreds of millions of dollars in incentives for companies that promise to create jobs here.
But state Republican lawmakers an also claim credit for lowering the corporate tax rate and passing other pro-business laws. And of course, some job growth is natural, even without any political action from either side, since North Carolina is one of the fastest growing states in the country.
Did Biden make NC business friendly?
Claim: Biden has said that recent announcements of major corporations settling in North Carolina are evidence of his “economic strategy at work.”
Fact: Biden has specifically claimed credit for North Carolina’s success in attracting VinFast, a startup auto manufacturer that chose Chatham County for its first North American production facility.
The Vietnamese company plans to hire about 7,500 workers and produce more than 200,000 electric vehicles per year.
In a statement following VinFast’s announcement, Biden said his administration’s “efforts to build a clean energy economy are driving companies to make more in America, rebuild our supply chains here at home, and ultimately bring down costs for the American people.”
Republicans bristled at the suggestion that Biden’s presidency has spurred North Carolina’s growth.
“This has nothing to do with President Biden’s economic strategy,” GOP Senate leader Phil Berger’s office said in a tweet responding to Biden’s statement. “It has everything to do with the Republican-led reforms that resulted in unprecedented economic growth.”
VinFast is the latest in a series of economic announcements that began before Biden’s presidential term. North Carolina has long marketed itself to big companies as a low-tax state with lucrative incentive packages.
Apple, which committed last August to opening a new campus at Research Triangle Park, negotiated with state legislators and N.C.’s Commerce Department for years in advance of its 2021 announcement. More recent announcements such as Boom Supersonic and a Toyota Battery plant — both of which are building in the Greensboro area — seem closely tied to Republican-led incentive policies after Republicans fast-tracked an incentive package worth $121.5 million to seal the Boom deal.
While Biden’s administration may have had some role to play in VinFast’s arrival, North Carolina’s legislature seems chiefly responsible for the economic win. Cooper’s office credited the N.C. Department of Commerce for securing VinFast and listed the state and local organizations who played a role in bringing the company to North Carolina.
Is Biden to blame for inflation?
Claim: At a House Democratic conference in Philadelphia last month, Biden skirted responsibility for the country’s rising inflation.
“So, I’m sick of this stuff,” he said. “We have to talk about it because the American people think the reason for inflation is the government is spending more money. Simply not true.”
Fact: It’s true that Biden inherited a challenging situation: the latter half of a global pandemic, several stimulus packages that preceded his presidency and global supply chain shortages.
So while Biden is not entirely to blame for rising inflation, some of his choices have worsened the problem, an Associated Press fact check confirmed.
Last year, the president signed a $1.9 trillion coronavirus relief package known as the American Rescue Plan. Several economists, including members of past Democratic administrations, decried the decision as reckless.
“Harvard University economists Jason Furman and Larry Summers — both officials in past Democratic administrations — warned of inflation rising because of the size of the relief package,” the Associated Press reported. “Many conservative economists joined them, including Michael Strain of the American Enterprise Institute.”
The money saturated an already overburdened economy. Biden acknowledged the inflation risk but countered by arguing the benefits outweighed potential repercussions.
It’s impossible to know whether the latter statement was true. The American Rescue Plan did hasten economic growth. But government spending bears some of the blame for our high-inflation situation, The Associated Press reports.
Big corporations skipping out on taxes?
While a main theme of Biden’s speech Thursday was celebrating corporate growth and new jobs, he also took some of the nation’s biggest companies to task for not paying any federal income taxes.
“I’m not somebody that doesn’t think you should be able to make a million or a billion dollars,” Biden said. “Just pay your fair share. Just pay a little tiny bit. Not a joke: Of the Fortune 500 companies ... 55 of them last year didn’t pay a single penny in tax. And they made $40 billion.”
That might seem at first like it can’t possibly be true, especially here on the last day before the April 15 tax filing deadline as many North Carolinians have just finished paying their taxes.
But Biden is correct, according to research on this topic by the Institute of Taxation and Economic Policy, or ITEP. Last year, 55 of the nation’s biggest companies on the Fortune 500 didn’t pay any federal income taxes, despite making a combined income of just over $40 billion. And on top of that, many profited at tax time, since they were given rebates.
Several of those 55 companies are headquartered in North Carolina: Duke Energy, Sealed Air and Albermarle Chemical all appeared on the list compiled by ITEP.
▪ Albermarle Chemical, which is involved in everything from electric car batteries to pharmaceuticals, made $42 million and paid $0 in federal income taxes, according to that report, for an effective tax rate of -0.3%.
▪ Duke Energy, a multistate utilities company, made $826 million and received tax rebates of an additional $281 million, for an effective tax rate of -34%.
▪ Sealed Air, the Charlotte-based company that makes Bubble Wrap and similar products, made $323 million and received $14 million in tax rebates, for an effective tax rate of -4.4%.
Did the child poverty rate decline by nearly 40%?
Claim: “We’ve seen the lowest child poverty rate ever projected and estimated nearly a 40% decline in child poverty,” Biden said during his speech.
Fact: The Child Tax Credit created by Congress to help provide relief to families during COVID-19 was estimated to lower the number of children experiencing poverty by 40%, The Guardian reported. It was estimated that the child poverty rate would decrease from 14.2% in 2018 to 5.6% in 2021.
But here’s the catch. In December, Congress needed to pass the Build Back Better bill to extend the Child Tax Credit. That didn’t happen.
Between December 2021 and January 2022, the monthly child poverty rate jumped from 12% to 17%, which is the highest it has been since the end of 2020, according to the Center on Poverty and Social Policy at Columbia University. The increase impacted Latino and Black children the largest. The poverty rate for children dropped just below 17% in February.
Does Delaware have the ‘eighth largest Black population in the country’?
The claim: President Joe Biden opened his speech saying, “Most people don’t realize, Delaware is the eighth largest black population in America.”
Fact: This is not quite true.
Biden made this same statement in a speech in 2019, leading Politifact to check his statement. Ranked by size, Politifact found that Delaware does not rank among the top states. With 220,000 Black residents, it ranks in the bottom one-third of states, Politifact reported.
Biden would be correct if he added said he was using a comparison of the Black populations in states by percentage. In that case, Delaware currently ranks in seventh place with Black residents making up 23% of its population. North Carolina ranks immediately behind Delaware at 21%.
This story was originally published April 14, 2022 at 1:33 PM.
