Economist Gary Cohn, a Democrat, is refusing to let President Joe Biden pull the wool over Americans' eyes.

To help Biden win re-election, the Biden administration is promoting a narrative about the economy that is more bark than bite. For example, at his State of the Union address last week, Biden minimized inflation, claimed to have created "15 million new jobs," and blamed corporations for the high prices of goods, which he calls "shrinkflation."

But the truth is not the rosy picture that Biden painted, Cohn said Sunday on CBS News' "Face the Nation" — especially when it comes to inflation.

"Inflation has a compounding effect. Meaning, as you look at inflation year over year, you're adding up those numbers. You're not starting at a zero every year," Cohn explained. "If we had 6% inflation last year and now we have 4% inflation, that's 10% inflation."

Because "there's a huge cumulative effect to inflation," Cohn said that in his scenario of 10% inflation, that means a basket of groceries that once cost just $100 now costs over $125 because inflation increases "add up."

"So, when people are being told, 'Consumers, you're wrong, inflation's heading [down]—' no, they're right, it is actually more expensive?" host Margaret Brennan followed up.

"They're completely right. They're completely right," Cohn responded.

Not only is inflation cumulative, but what Biden doesn't tell you is that shrinking inflation does not mean prices of goods also decrease. Instead, prices continue to increase, but at a smaller rate. This is an important distinction, and it's where Biden's positive message about inflation gets lost in reality. Prices aren't going down, and the purchasing power of the dollar has been diminished.

For all of Biden's talk about inflation decreasing, groceries cost Americans 25% more today than in January 2020.

This is why poll after poll shows that Americans are dissatisfied with Biden's economic record. Combine inflation with high interest rates, which the Federal Reserve justifies to control inflation, and you get a bad recipe for re-election.

"People were losing purchasing power, and that's why people were angry," Cohn said of the inflation crisis. "And then take on top of that the high interest rate environment where, if you thought you might have been in a position to buy a house because you saved money, you go out to get a mortgage at 7% or 8%, you can't afford a house.

"People got very frustrated because the costs of their everyday lives got very expensive and the cost of investing in their future by buying a home got nearly impossible," he explained

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