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Politics Foreign Affairs Culture Fellows Program

It’s the Economy Again, Stupid

Biden’s insistence that everything is fine cuts against voters’ actual daily experiences.

President Biden Meets With Mexican President Obrador In The Oval Office
(Photo by Chris Kelponis-Pool/Getty Images)

One of the most succinct campaign slogans of the modern era came out of the 1992 Clinton campaign: “It’s the Economy, Stupid,” which picked up on the feeling Americans were less concerned with the incumbent’s apparent foreign policy success (remember Desert Storm?) than the nation’s changing economy. Clinton spun his personal concern for voters’ well-being off this, with the catchphrase “I feel your pain.”

Things seem headed for some sort of through-the-looking-glass-style repeat in 2024, as the incumbent is hoping to sell voters on the strength of the economy when they are more than skeptical. Bidenomics’ thrust seems to be “The Economy Is OK, Stupid.”

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“Bidenomics,” the word itself, melds two of the incumbent’s vulnerabilities: First, he is Joe Biden, 81 years old, “the Crypt Keeper”; second, the economy is fine, and just fine, if you don’t look at it too closely. Not much can be done with the first liability, but the second opens the door for Donald Trump to run on a populist version of the economy argument that could leave Biden looking uninformed and out of touch.

The New York Times paints the brightest picture of Biden’s economic world. Bidenomics propaganda points out that, in 2020, the average wage of workers who still had a job rose without talking about those who were laid off, disproportionately service workers. Growth in wages for everyone was then held down because those low-wage workers were being rehired at their old salaries.

Bidenomics fanboy Paul Krugman actually went as far as writing in the Times, “Until recently I thought everyone—well, everyone following economic issues—knew this.” Stupid voters, not keeping up with the Times. “There are two big questions right now about the U.S. economy,” says Krugman. “One is why it’s doing so well. The other is why so many Americans insist that it’s terrible.”

This dumb line of reasoning seems to attract progressives. One coined the term “vibe-cession” to describe the gap between the common perception and cherry-picked economic indicators. Others insist it’s poor perception and political polarization that are mostly to blame. Then, there is good old social media and its misinformation, reinforcing the “bad economy belief." A former Federal Reserve economist quoted by, of course, the Times, wrote that a “toxic brew” of human bias for negative information and the attention economy lead to consumer pessimism. If only those rednecks who don’t subscribe to the New York Times could see the view from up there.

The problem down here is economic reality, off-limits in Bidenomics. Start with inflation. Things cost more, with some of the highest jumps in prices in decades. (With the exception of the pandemic, there hasn’t been a year with average annual inflation above four percent since 1991.) Even after years of the Fed raising interest rates (see mortgages, below), inflation coming down does not fix the everyday problems of Americans.

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“Inflation,” as economists define the term, is nearly meaningless to most voters because it excludes food and energy prices: two significant parts of any household budget. To include those parts of most voters’ lives, you're looking for the Consumer Price Index, which includes everything but which rarely appears in feel-good tales of the Biden economy. Even then, watch the magician’s hands closely; prices at the pump are down more than 30 percent since their peak last year, but still up considerably since Biden took office. Some 74 percent today say they’re “at least somewhat worried” that the cost of living will climb so high that they will be unable to remain in their community.

Now about those mortgages. As the Fed raised interest rates to push back inflation, loan costs rose in kind. Average monthly payments on a new home jumped to $3,322 in the third quarter of the year, data from real estate investment firm CBRE shows. It means they have risen 90 percent since the final quarter of 2020—just before Biden took office in January 2021—when it was $1,746. Home ownership is becoming an unattainable dream to many Americans. Interest rates above seven percent and soaring house prices mean buyers are facing one of the least affordable markets in recent memory.

The low unemployment Biden touts does mean more Americans are working, but says nothing about mediocre wages, underemployment, and those forced into two or more jobs to make ends meet. A Blueprint/YouGov poll on the economy found just seven percent of respondents were principally concerned about the availability of jobs, while 64 percent were most worried about prices.

Bidenomics, of course, famously focuses on jobs created. Even then the numbers are slippery; the vast majority of this touted job growth comes from restoring job losses from the pandemic. Check instead the broader unemployment rate that includes underemployed and discouraged workers, which, at 7 percent, is nearly twice as high as Bidenomics claims. And watch claims of rising wages—most rises have been negated by inflation growing at an even faster pace.

Perhaps most significantly among economic perceptions is voters’ view of the future. According to the New York Times, a poll from March found that “just 21 percent of respondents felt confident that life for their children’s generation will be better, matching the record low since this question was first asked. In 1990, 50 percent of those asked felt life would be better for their kids.” The national debt, $5.7 trillion when Bill Clinton left office, has reached $34 trillion. This constitutes a form of intergenerational theft; rising interest costs will eventually require higher taxes or cuts in federal programs or both.

Food prices are up almost 6 percent under Bidenomics. Some 59 percent of parents will spend more than $18,000 per child on child care in 2023. The overall average manufacturer’s suggested retail price of new vehicles in 2023 was $34,876, 4.7 percent higher than the previous year. Average annual health insurance premiums increased 7 percent in 2023. The average family premium has increased 22 percent since 2018.

The Biden people have it just 180 degrees wrong; perception does matter and is not “wrong.” And it does not matter that some of the economic effects listed here are not Joe's “fault.” Past experience shows the guy in the Oval Office takes credit or accepts fault for what happened on his watch, at least in most voters’ minds.

This is because while a few economists are voters, very few voters are economists. What the economy feels like at the checkout, at the end of the month, at the pump, matters most and will drive voting choices. So a recent poll found just two percent of registered voters said economic conditions are “excellent,” with only 16 percent saying they were “good.”

A majority of voters already trust Trump more than Biden on the economy. You can’t just tell the voters they are wrong and that all is actually well when it is not. Bill Clinton called it in 1992, Donald Trump will surely emphasize it this year, but Joe Biden hasn’t heard it yet with the election just about ten months away: It’s the economy, stupid.

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