US Election 2024. Biden is suffering badly in the polls because most voters only look at kitchen table issues like the prices of eggs and gas
On October 28, 1980, Ronald Reagan, in a debate with President Jimmy Carter, asked, “Are you better off today than you were four years ago?” That question has been posed in every election since. Biden may struggle to say that Americans are better off.
President Biden has an impressive economic record, including one of the world’s highest GDP growth rates, the lowest unemployment rate in 50 years, a huge increase in new jobs with 800K in manufacturing alone, and a lowering of drug prices. However, the inflation rate and prices across the board have increased faster than wages. Inflation has become a hidden tax for Americans regardless of employment. The President is suffering badly in the polls because most voters only look at kitchen table issues like the prices of eggs and gas.
The President has only seven months left to convince Americans that he has done an overall better job than Trump.
Most Americans do not understand that the increase in inflation (in 2021-2022) is due primarily to monetary and fiscal policies that increased people’s purchasing power at a time when the COVID-19 pandemic decimated global supply chains; there was too much money chasing too few goods.
The Ukrainian war increased inflation by decreasing oil & gas output from Russia, and it disrupted worldwide food supplies. In addition, heat waves, fires, and floods contributed to food shortages and drove up prices. Lastly, in 2022-2023, an avian flu outbreak required the culling of tens of millions of chickens, raising food prices as well.
Biden’s goal in 2021-2022 was to avoid a recession, get people back to work, provide a lifeline to the unemployed, and eliminate food insecurity. He passed the American Recovery Act and the Inflation Reduction Act, which included lowering drug costs, adding $400 billion for climate change, providing state and local aid, and increasing corporate taxes to offset the U.S. deficits. Unfortunately, the legislation increased the inflation rate.
If Biden had not passed legislation designed to reduce unemployment and poverty, inflation would have risen above the Trump inflation rate of 1.7%, given an economic recovery coming at a time when the global supply chain was in chaos.
However, according to several economists, Biden’s legislative packages were too generous and may have increased inflation by 3-5%. However, it is also accepted that the legislation reduced unemployment and poverty and accelerated the recovery; overall, Biden’s actions had a net positive effect on the country.
Biden had limited tools to reduce inflation. The Federal Reserve controls fiscal policy. The Fed needed to lower interest rates when the pandemic hit the country. They raised the rates to reduce inflation. No President can force the Fed to adopt policies. Some Presidents have tried to persuade the Fed to adopt a course of action by publicly complaining about its actions (often called jawboning). Biden has respected the Fed’s independence and taken a hands-off approach.
It is also important to note that many countries are experiencing inflations equal to or higher than the U.S. rate.
Many Americans do not feel that Biden has done a good job despite the impressive economic recovery, low unemployment rate, and new jobs. The problem is most Americans do not understand that prices for goods and services are globally linked. They do not recognize that war in Ukraine and the avian flu will converge to drive up oil and chicken prices in the U.S. They are focused on themselves and not the overall economy. The Okun Misery Index (the Index) can illustrate this.
The Index indicates how the average American is affected by the economy. It is a combination of Inflation and Unemployment Rates. Presidents with high indices lost elections; Jimmy Carter had the highest average at 16.26 (1970-1980). Trump’s Average Misery Index (2017-2020) was 6.91, with the lowest monthly Index of 5.21 (Feb. 2019). Biden’s Index for 2021-2023 was 10.91, and the lowest month was 6.79 (Feb. 2024). Many will look at these numbers and say the Trump years were better. However, they do not consider that Trump inherited a strong economy with 4.7% unemployment and inflation below 2%. Biden took over an economic and political mess.
The President needs to highlight the declining U.S. inflation rate, job growth, investments in climate change and computer chip technology, lower drug prices, and his leadership of the free world. He must ask if the country is prepared to elect a man who plans to be an authoritarian leader. A man who intends to weaponize the Department of Justice and take revenge on his critics, begin mass deportations of immigrants, curb the rights of women, and abandon NATO as well as Ukraine.
Biden can win in November if he can focus voters on the present and future of the U.S.
