That’s how strong the US economy really is under Joe Biden

US political advisor James Carville is one of those indestructible TV faces that makes watching news channels here really difficult. Especially when the breaking news situation is rather quiet, CNN and Co. do not fill their broadcast time with elaborate correspondents or specially researched stories. Instead, they put four to five people with different party backgrounds together in discussion groups, who then hardly say anything new, but simply repeat party propaganda.

The 79-year-old Carville is also often connected to such rounds from his living room in Mississippi, and there is a simple reason for this: In the 1992 election campaign, as an advisor to challenger Bill Clinton, he coined one of the most famous political sayings in the USA – “It’s the economy “stupid”.

And with that, from New York: Welcome to the new US radar, which today deals with the question of how well the economy in the United States is really doing – and which of the two presidential candidates is better at communicating their proposals and successes.

The big question in November will be whether “It’s about the economy, you idiot” is still a valid saying. In 1992, Clinton was able to score points against the incumbent George Bush Sr. because the country, like many other Western countries, was in recession at the beginning of the 1990s. Clinton promised change, Bush stagnation.

However, according to many important indicators, the USA will enter the 2024 election campaign with a much healthier economy. But voters are not only pessimistic about the state of the USA, they also give incumbent Joe Biden a miserable report card.

Voters hate how Biden is running the economy…

was published in the “Financial Times” Last week , a new survey on satisfaction with Biden’s economic policy : 60 percent of respondents partially or completely reject it – a proportion that was similar at other institutes and has remained almost unchanged for six months . 48 percent say they have been doing worse financially since Biden took office, only 20 percent think they are better off.

45 percent also believe that Biden’s policies have hurt the economy, while only 31 percent think they have helped. And 80 percent still say that price increases are the biggest stress factor for them when it comes to personal finances, especially when it comes to food.

… and they are angry about the high prices in the supermarket

And that brings us to a key problem for Biden: The inflation rate may have fallen again long ago, but it is also based on an average basket of goods and services, many of which are rarely bought. Almost every day, people remember that when they shopped in the supermarket under Donald Trump, the basket was fuller and cheaper. “Americans are really, really unhappy about food prices,” in more detail about this phenomenon.

If you’re honest, the president has little influence on how much eggs and bread cost, but those in power are happy to receive praise when the economy is doing well – so they also have to deal with criticism when it’s low.

the economy

Biden knows this. Even in the State of the Union address, he didn’t miss the opportunity to promise ideas against shrinkflation and complain about declining filling quantities in bags of chips at the same retail price. At least on this issue there is a little hope for Biden, because the Financial Times survey also showed that an increasing share of 63 percent blame the manufacturers of the products rather than the Democrats’ policies for the high prices.

In this area, Biden is also fighting against Trump’s greatest perceived strength, who is still considered an accomplished businessman in the eyes of Americans. Many consider Biden’s challenger and his Republicans to be more competent on economic issues and nostalgically remember Trump’s first term in office: 65 percent of those surveyed told at the beginning of the month that the economy was good under him; currently only 38 percent have this impression.

The USA performs excellently in many economic indicators

It will probably be decisive for Biden’s election whether he can make it clear to voters by autumn that his performance is better than is reflected in such opinions. The list of its successes is long, and it is particularly impressive when compared to other Western industrial nations.

For example, in 2023 the US economy grew by more than 3 percent, while recorded a decline of 0.3 percent. The US forecasts also had to be revised upwards in the first quarter of 2024; an end to growth does not initially appear to be in sight. Since the end of 2019, the US economy has grown by 8 percent in real terms – twice as much as in the euro zone and ten times as much as in Japan,

But that’s not the only metric Democrats like to talk about:

  • Gasoline costs a third less than the previous peak price in summer 2022.
  • Unemployment has been below 4 percent for 25 months in a row – a range like this has not been seen in 50 years.
  • Real wages have been rising again for many months, and U.S. productivity is healthy, with the number of hours worked increasing by only 0.4 percent last year.

An important reason for these successes was the generous pandemic checks that Trump and later Biden distributed: In total, this stimulus amounted to 26 percent of the gross domestic product for a year, around twice as high as in other countries. As a result, the deficit has grown, but the USA has also avoided the problems of other countries in terms of economic growth, inflation and unemployment.

Biden wants to continue his course – Trump would hinder him

The Democrats are troubled by the fact that voters not only do not recognize these successes, but also that they hardly consider the possible consequences of Trump’s plans for a second term in office.

Among other things, US economy Biden’s challenger is promising 10 percent import tariffs, which would have serious consequences for production costs and inflation. He also wants to deport millions of people – but in reality the USA also needs the estimated at least ten million people who work without valid papers. They hold more than 5 percent of the jobs in the country. Increasingly, the question will now be whether potential centrist voters will reject Trump’s ideas in the coming months.

After all the hand-wringing about Joe Biden’s lack of communication successes, I come to a surprising number from Simon Rosenberg’s newsletter. He writes the “Hopium Chronicles ,” a play on words based on the “opium for the people” idea: The political advisor was repeatedly accused of being too naïve about the Democrats’ chances of success and of delivering a kind of numbing “hopium,” but Rosenberg stuck to his guns Optimism firmly.

And then came the 2022 midterm elections, in which Rosenberg correctly and decisively predicted, based on some fundamental data, that there would not be a wave of success for the Republicans. Since then, the man has been considered a welcome conversation partner who wants to counterpoint the fear of Trump and the negative headlines for Biden.

Some of this doesn’t go beyond opinion journalism, but what I found remarkable was the fact recently highlighted by Rosenberg that Joe Biden would have received money from 469,000 individual donors in February 2024 – a big increase over the almost 350,000 donors who supported Barack Obama in February 2012.

In any case, Biden is heading into the spring and summer with a major financial advantage over Donald Trump. At the end of February, the incumbent had around $155 million in cash for his campaign, an increase of $25 million compared to the end of January. Trump, on the other hand, has long been misusing his donations to cover the legal costs of his many lawsuits – at the end of January, his campaign office reported cash assets of around $40 million,

Joe Biden

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