Bidenomics Proves Tough Sell as Inflation Bites

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Months of skyrocketing inflation have made it harder to justify President Biden’s proposals for expanded domestic spending. A RealClearPolitics average of polls shows that 57.9% of Americans do not like how the president handles the economy.” It’s still challenging for many families,” the American president conceded.

Left to right: Janet Yellen, Joe Biden, and Brian Deese.

Soaring prices hurt the case for Biden’s economic agenda

Last week, Joe Biden went to Pittsburgh, Pennsylvania, stood in front of a newly rebuilt bridge, and called voters to support his party in the upcoming midterm elections. The US president admitted it’s still hard for many families.

Most job market measures show that the United States is getting stronger. Biden shouldn’t have much case arguing for his economic plan, which has included massive increases in government spending, higher taxes, and stricter rules for the wealthy and big businesses.

Since January 2021, the Democrats have been in charge of a recovery that has added 10 million jobs and brought the unemployment rate down to 3.5%. But months of consistently high inflation — consumer prices were still going up at an annual rate of 8.2% in September — have made “Bidenomics” almost hard to sell on the campaign trail. The average of the polls done by RealClearPolitics shows that 57.9% of Americans don’t agree with how Biden is handling the economy. In contrast, 38.9% agree that Democrats have a major flaw that could cause them to lose control of the House of Representatives and maybe even the Senate.

Mark Zandi, an economist at Moody’s Analytics who has advised both Republican and Democratic lawmakers, says that the policies are good for the economy in the short and long term. People are paying much more at the gas pump, the grocery store, and for rent, and high inflation is making people doubt how well they are doing and how well the president handles the economy. And everything is affected by what Zandi said.

An aide spins a “Biden-omics” prop used by Senator Joni Ernst, a Republican from Iowa, not pictured, on the Senate floor at the U.S. Capitol in Washington, D.C., U.S., on Wednesday, July 14, 2021. [ Al Drago/Bloomberg/Getty Images]

Biden’s Economic Policies: New Deal and Safety Net Expansion Cross

Biden’s economic policies are a mix of Franklin Delano Roosevelt’s New Deal and Lyndon Johnson’s expansion of the safety net. This is because Americans were thought to be ready to accept a more substantial role for the government in the economy after the coronavirus pandemic.

During months of talks with Congress, Biden’s goals were changed and spread across at least four major pieces of legislation. First, though, Obama signed into law trillions of dollars from the federal government for direct stimulus payments to households, infrastructure financing, subsidies and incentives for investments in clean energy and chip production, and measures to lower the cost of prescription drugs.

Felicia Wong, president of Roosevelt Forward, a progressive think tank on Biden’s transition team, said that all of these were top pursuits for Democrats and were very popular. But the voters disagreed with them. Wong believes it takes a lot of work to make a boom happen with these tight supply networks and complex international economic ties. It’s even more complicated when voters don’t understand it, and politicians don’t talk about it or try to explain it for understandable reasons, even if sometimes regrettable.

Some Democratic strategists and pollsters think that the party is trying to figure out when and how to talk plainly about the economy, compared to other issues like the radicalism of former President Donald Trump and the Supreme Court’s destruction of abortion rights.

Last week, Patrick Gaspard, Stan Greenberg, Celinda Lake, and Mike Lux wrote in “The American Prospect” that Democrats need to realize that they have a winning message on the economy and inflation. Still, they will only succeed if they pay attention to rising costs. They said that inflation and the cost of living are people’s biggest concerns right now and that they think and talk about it all the time, partly because they believe it will keep getting worse with no end in sight.

Portrait of Franklin D Roosevelt by Vincenzo Laviosa (Italian, 1889 – 1935); toned silver print, 1932. [GraphicaArtis/Getty Images]

Relentless Republican Onslaughts Politically Effective

Republican attacks have been enduring, and they have affected politics. They have used cash infusions and big spending in campaign ads, social media, and public events to spark and fuel inflation, even though the war in Ukraine and the delays in the supply chain caused by Covid-19 were also big factors.

In the economic few months, Biden and his economic staff have been quick to talk about what they have done to help the economy. For example, Treasury Secretary Janet Yellen has been traveling the country to talk about everything from electric cars to tax breaks for clean energy. She called the administration’s economic philosophy “modern supply-side economics.”

The head of the National Economic Council, Brian Deese, went to downtown Cleveland to talk about what the administration is doing to protect domestic supply chains and bring American industry back to life. Because of these efforts, big companies like Intel and General Motors are moving quickly to set up shops in Ohio. So, in recent years, this Midwestern state has become more Republican.

In an interview last week in the West Wing of the White House, Deese said that it is an economic policy that gives more attention to communities that have been ignored too often. If that keeps up and works, people will notice and do something about it.

Deese has also said that the economy can avoid a recession even if the Federal Reserve raises interest rates, citing the strength of household balance sheets and the labor market. He says that crucial indications of economic stability, like credit card and mortgage defaults and personal bankruptcies, are between 10% and 30% lower than before the pandemic.

2nd December 1963: American President Lyndon Baines Johnson addresses the nation on his first thanksgiving day television programme, broadcast from the executive offices of the White House. [Keystone/Getty Images]

The administration’s scrambles

The Biden administration has moved quickly to do things like release oil from the Strategic Petroleum Reserve to lower prices in the short term. If more needs to be done, it promises to do more to lower the cost of gasoline, which is the most politically sensitive good in the United States.

Even though prices have gone down in the last three weeks, they are still higher than they were a month ago, as White House Chief of Staff Ron Klain pointed out in a tweet on Sunday. To show how different he is from the other side, Biden has said that if Republicans take control of Congress, there will be new fights over taxes and spending, which could lead to a crisis over the debt ceiling and a default.

Tim Kaine, a Democrat from Virginia and a senator, believes voters will give his party the benefit of the doubt. Tim believes voters understand that neither Democrats nor Republicans have a magic wand. They have different ideas about what caused the problems, and he believes they understand some of the world’s biggest problems. But they want to see Congress trying to do something about it.

But some political experts warn that it may be too late to change how people talk about the economy. For example, Ben Koltun of Beacon Policy Advisors believes it would be easier to understand how to market a policy playbook from 2020 or 2021 in a different setting in 2022, which doesn’t work.

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