Sixteen Nobel Prizewinning economists signed a joint letter on Tuesday warning of what they see as economic risks if former president donald trump would serve a second term, including the reheating of inflation.
“While each of us has different opinions about the specifics of various economic policies, we all agree that Joe Biden’s economic agenda is far superior to Donald Trump’s,” the economists wrote. Axios was first to report the letter.
“There is, rightly, concern that Donald Trump will reignite this inflation, with his fiscally irresponsible budgets,” wrote the group of politically progressive academics.
So far, Trump has proposed making his first term tax cut permanent, imposing universal tariffs on all imports, with a China-specific tariff of between 60% and 100%, and pressuring the independent Federal Reserve Board to reduce interest rates.
Both economists and Wall Street analysts have predicted that any or all of these proposals could reinflate prices, which remain vulnerable despite a slight cooling in recent months.
Joseph Stiglitz, who won the Nobel Prize in 2001, led the effort to publish Tuesday’s letter. His co-signatories include George Akerlof, Sir Angus Deaton, Claudia Goldin, Sir Oliver Hart, Eric Maskin, Daniel McFadden, Paul Milgrom, Roger Myerson, Edmund Phelps, Paul Romer, Alvin Roth, William Sharpe, Robert Shiller, Christopher Sims and Robert Wilson.
“Nonpartisan researchers, including Evercore, Allianz, Oxford Economics, and the Peterson Institute, predict that if Donald Trump successfully implements his agenda, it will increase inflation,” the economists wrote.
Stiglitz said he felt compelled to initiate the letter based on a flurry of recent polls in which voters said they trust Trump over Biden to manage the U.S. economy.
“A lot of people think Trump would be better for the economy than Biden,” Stiglitz told CNBC in an interview. “I thought it would be important for Americans to know that at least one group of credible economists differs strongly.”
The timing of Tuesday’s letter was notable, coming just days before the scheduled showdown between Trump and Biden in the first presidential debate of the general election. The Atlanta debate hosted by CNN is expected to devote significant time to the economy and, specifically, inflation.
The Trump campaign vehemently rejected the Nobel economists’ position.
“The American people do not need useless, disinterested Nobel Peace Prize winners to tell them which president put the most money in their pockets,” Trump campaign spokeswoman Karoline Leavitt said in a statement to CNBC.
Under Trump, the December annual Consumer Price Index fell during three of his four years in office.
Biden’s campaign took the opportunity to release the letter on Tuesday: “Top economists, Nobel Prize winners and business leaders all know that America cannot afford Trump’s dangerous economic agenda.”
The Nobel laureates’ letter contained a distinct political as well as economic perspective.
Many of these economists signed a similar agreement September 2021 Letter expressing support for President Joe Biden’s Build Back Better package. Critics at the time argued that the huge spending packages would increase inflation.
At the time, Stiglitz noted that some people “invoked fears of inflation as a reason not to undertake” Build Back Better investments. “This view is shortsighted,” he said in a press release.
This time, Stiglitz and his guarantors have taken a more cautious approach to inflation, after the US economy spent the last year recovering from the scorching inflation spike of 2023.
The higher prices were due in part to pandemic-era supply chain problems that left the global trading system unable to satisfy pent-up demand from American consumers.
But this demand was itself the result of a US economy that weathered the pandemic better than many predicted – thanks to generous government subsidies such as the expanded Child Tax Credit and the Paycheck Protection Program.
Since then, Stiglitz said, Biden has led a successful effort to cool inflation spikes.
“Inflation was reduced, actually, remarkably quickly,” he said. “I would say it’s because of Biden.”
This story originally appeared on NBCNews.com read the full story
