Old North News

Critics are taking to Twitter to point out that ever since President Joe Biden released COVID-19 stimulus checks in March 2021, amounting to nearly $2 trillion, Americans' year-over-year real wage growth has been negative.

As American families and businesses were compensated with stimulus checks during the pandemic, evidence is leading people to believe that this move was one of inflation's contributing factors. Meanwhile, the announcement of June's inflation numbers and Biden's newest round of stimulus checks in some U.S. states, including North Carolina, are leaving Americans wondering if the stimulus plan is making inflation worse.

"Joe Biden is the pay cut president,” Tommy Pigott, rapid response director for RNC Research, tweeted on July 11, before the latest statistics showing June's inflation rate at 9.1% were released. “Year-over-year real wage growth -- your paycheck accounting for inflation -- has been negative every single month since Biden passed his $1.9T 'stimulus.' By contrast, real wages were only negative one month during Trump’s entire four-year term.” 

A Statista report from mid-June says that inflation has been outpacing nominal wage growth for 14 consecutive months, meaning Americans can afford less than they could a year ago, despite wages rising on paper. 

U.S. Bureau of Labor Statistics (BLS) data show that while average hourly earnings rose 5.1% to $32.08 from $30.52 over the past 12 months, consumer prices jumped 9.1%, resulting in a 4% decline in real hourly earnings.

The combination of low interest rates, pandemic-related supply constraints and heavy consumer spending that was fueled, in part, by government-issued stimulus checks put upward pressure on prices before Russia’s invasion of Ukraine, according to Statista. 

GoBankingRates says there’s no question that Biden's stimulus payments are responsible for fueling at least some of America's inflation. 

“Those who draw a straight line between stimulus payments and generationally high inflation have two indisputable facts on their side,” GoBankingRates said. 

Indeed, ABC News has reported that no country distributed anywhere near as much stimulus money to its people as the U.S. and that no country has been hit as hard by rising inflation.

Another round of stimulus checks is on the way in some states as prices continues to surge. Forbes Advisor reports that 14 states will send — or have already sent — payments to taxpayers in the coming months. In North Carolina, a bill in the General Assembly would grant $200 checks to residents (namely, licensed drivers over 18), but has been opposed by state Senate Republicans, who would rather see a long-term tax reduction rather than a one-time rebate, according to Forbes.