Thursday, Feb. 1, 2024 | 2 a.m.
If President Joe Biden’s reelection hinged on the state of the economy, he’d be a good bet, or at least a better one. Instead, it’s voters’ perception of the economy that matters. Which is a big reason the president is struggling as his campaign against presumptive rival Donald Trump gets underway.
Rarely if ever in the modern history of polling has there been such a disconnect between how the economy is faring and how many Americans think it’s doing. That’s partly because of our political polarization. Media coverage of the economy, and of the Republicans who falsely blather about it unchallenged, isn’t helping. We journalists have to do better: Stop letting Sen. Tim Scott, R-S.C., for instance, get away unchecked with saying Biden “has destroyed our economy,” as happened on a recent Sunday talk show.
But the real onus is on Biden. He must persuade the persuadables among skeptical voters. He’s trying, but he needs help from the Democratic bench, and fast.
Separate news late last week — about two government reports, a stock market record and a national poll — underscored how divorced economic reality and perception have become.
A report was released last week showing that the economy had grown 3.1% in 2023 — faster than the gross domestic product’s average growth in the three pre-pandemic years under Trump. Word followed one day later that inflation continued to cool in December, to levels last seen before the pandemic. The inflation report stoked investors’ confidence that the Federal Reserve would indeed cut interest rates; the S&P 500 surged for yet another record trading day.
Economic growth. Back-to-normal inflation. Lower interest rates. A bull market. It all confirms a trend that’s been apparent for months, along with low unemployment, more job creation than under Trump and real wage increases outpacing inflation. Meanwhile, talk of an imminent recession is so 2022.
The superlatives from giddy economists read like the promo blurbs on movie ads: “Just a perfect report” — Mark Zandi, Moody’s Analytics. “Stunning and spectacular” — Diane Swonk, KPMG. “Hard to imagine how things could look better” — UBS’ Brian Rose. “This year has been like Rock ’Em Sock ’Em Robots” — Dan North, Allianz Trade Americas.
Responding to Biden’s celebratory statement — “Wages, wealth and employment are higher now than they were before the pandemic” (read: when Trump was president) — even Trump’s former economic adviser, Larry Kudlow, conceded on his Fox Business show, “I would be bragging about it, too.”
From most Americans, however, all you get is a Bronx cheer.
Amid the good economic reports came poll results from the Pew Research Center, and the headline said it all: “Americans More Upbeat on the Economy; Biden’s Job Rating Remains Low.” And “upbeat”? 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 came among Democrats and Democratic-leaning independents. Still, less than half of Democrats, 44%, had positive views of the economy. And just 13% of Republicans said it was excellent or good.
Many Americans’ views of the economy have long tended to be colored by whether the White House occupant is someone of their favored party. But that bias is more evident than ever in these more polarized times.
It’s become so pronounced among Republicans, two Stanford University economists found in November, that traditional models to gauge consumers’ sentiment using fundamental economic data (inflation, stocks, unemployment, consumption) “have broken down” since 2020. Consumer sentiment should be about 13 points higher on the feel-good scale, economics professor Neale Mahoney and doctoral candidate Ryan Cummings concluded.
With the oft-lying Trump calling the economy “so fragile,” and wishing for “a crash,” many in his party will never be convinced the economy is actually in good shape, no matter their own financial comfort. (“Things were better with [Trump] in office,” a Republican caucus-goer in Iowa told The New York Times, adding, “I have been pretty lucky, though.”)
But demoralized Democrats and the swing voters who decide elections in battleground states can be swayed. Granted, you can’t convince voters that the economy is good if they aren’t feeling it, but to some degree most Americans are, polls and data show. The early signs of rosier and more realistic consumer sentiment are reflected in this month’s double-digit rise tracked by the much-followed University of Michigan index. And the effect of Bidenomics’ long-term public investments, like the bridge-replacement project the president visited on the Wisconsin-Minnesota border last week, has yet to be realized.
The president has to hope the gains stick, as many economists predict, and that voters give him props.
Facing reelection in 2012, President Barack Obama told people privately that he was determined to win because “I’ll be damned” if someone else was going to take credit for the growth his administration had set in motion after the Great Recession. Surely Obama’s vice president remembers such talk. Maybe that helps explain why Biden is similarly driven to run again, even when many Democrats wish he’d retire: He’ll be damned if he’s going to let Trump, or anyone else, reap the rewards at all the ribbon-cuttings ahead.
But first Biden and his fellow Democrats have to convince more voters that his policies are working — that the U.S. economy really is as good as the data show.
Jackie Calmes is a columnist for the Los Angeles Times.
