If President Biden's re-election depended on the state of the economy, it would be a good bet, or at least a better one. Instead, it is the voters perception of the economy that matters. This is one of the main reasons the president is struggling as he begins his campaign against his presumptive rival Donald Trump.
Rarely in the modern history of polling has there been such a disconnect between how the economy is doing and how many Americans believe it is doing. That is partly due to our political polarization. The media coverage of the economy and Republicans speaking falsely about it without being challenged is not helping. We journalists need to do better: Stop allowing South Carolina Sen. Tim Scott, for example, to get away with saying that Biden “has destroyed our economy,” as happened on a recent talk show. Sunday interviews.
opinion columnist
Jackie Calmes
Jackie Calmes brings a critical look to the national political scene. He has decades of experience covering the White House and Congress.
But the real responsibility lies with Biden. He must persuade skeptical voters. He's trying, but he needs help from the Democratic caucus, and fast.
Separate news stories late last week – about two government reports, a stock market record and a national survey – underscored how divorced economic reality and perception have become.
On Thursday the report came that the The economy had grown 3.1%. in 2023, faster than the average gross domestic product growth in the three pre-pandemic years under Trump. On Friday the news followed that inflation continued to cool in December, at levels last seen before the pandemic. The inflation report fueled investor confidence that the Federal Reserve was indeed cut interest rates; the S&P 500 still rose another record trading day.
Economic growth. Inflation back to normal. Lower interest rates. A bull market. All this confirms a trend evident for months, along with low unemployment, more job creation that under Trump and real wage increases exceed inflation. Meanwhile, there is talk of a imminent recession is so 2022.
The superlatives of dizzying economists read like movie advertisements: “Only “a perfect report” —Mark Zandi, Moody's Analytics. “Impressive and spectacular”—Diane Swonk, KPMG. “hard to imagine how things could look better” — Brian Rose of UBS. “This year has been Like Rock 'Em Sock 'Em Robots”—Dan North, Allianz Trade Americas.
Responding to Biden's celebration statement — “Wages, wealth and employment are higher now than before the pandemic” (read: when Trump was president); including Trump's former economic advisor, Larry Kudlow, granted On his Fox Business show, “I would be bragging about it too.”
However, for most Americans all they get is a bronx joy.
In the midst of the good economic reports came Results of the test from the Pew Research Center and the headline said it all: “Americans More Optimistic About Economy; “Biden’s job rating remains low.” And “optimistic”? That's relative. Yes, Pew found a 9-point increase since last April in the percentage of adults who rate the economy as excellent or good—up to a whopping 28%. The increase occurred among Democrats and Democratic-leaning independents. Still, less than half of the Democrats, 44% had positive opinions about the economy. And only 13% of Republicans said it was excellent or good.
Many Americans' views on the economy have long tended to depend on whether the occupant of the White House is someone from their favorite party. But that bias is more evident than ever in these more polarized times.
It has become so pronounced among Republicans, two Stanford University economists found in November, that traditional models for measuring consumer sentiment using fundamental economic data (inflation, stocks, unemployment, consumption) “have fallen apart” since 2020. Consumer sentiment should be about 13 points higher on the well-being scale, economics professor Neale Mahoney and doctoral candidate Ryan Cummings concluded.
Since Trump, who often lies, calls the economy “so fragile” and wishes for “a crisis,” many in his party will never be convinced that the economy is actually in good shape, regardless of their own financial comfort. (“Things were better with [Trump] in office,” a Republican contender in Iowa said The New York Times, and added: “I've been very lucky, though.”)
But the demoralized Democrats and undecided voters who decide elections in battleground states can let go. Of course, you can't convince voters that the economy is fine if they don't feel it, but to some extent most Americans are, Surveys and data show. Early signs of more optimistic (and more realistic) consumer confidence are reflected in this month's double-digit rise tracked by the University of Michigan index. And the effect of Bidenomics long-term public investmentslike the bridge replacement project that the president visited at the Wisconsin-Minnesota border on Thursday, has yet to be done.
The president has to hope that the progress is maintained, as many economists predict, and that voters support him.
President Obama, facing re-election in 2012, told people privately that he was determined to win because “I'll be damned” if anyone else was going to take credit for the growth his administration had launched after the Great Recession. Surely Obama's vice president remembers those conversations. Maybe that helps explain why Biden is just as motivated to run again, even though many Democrats would like him to drop out: He'll be damned if he's going to let Trump, or anyone else, reap the rewards of all the ribbon-cutting he's done. are coming.
But first Biden and his fellow Democrats have to convince more voters that their policies are actually working: that the U.S. economy really is as good as the data shows.
