In his bid for reelection, President Joe Biden is struggling to convince voters that they are better off than they were four years ago. With an approval rating stuck around 40%, Biden’s handling of the economy is receiving even worse ratings. According to a recent poll by The New York Times, swing state voters trust former President Donald Trump over Biden on economic issues by a margin of 59% to 37%, the widest gap on any issue. The lack of trust in Biden’s economic capabilities may be the only thing keeping Trump competitive, despite the numerous criminal charges he faces and the general disgust with him beyond his Republican Party base.
The Yahoo Finance Bidenomics Report Card rates the Biden economy a B, based on six metrics tracked since Biden took office in 2021. Using data from Moody’s Analytics, Biden is compared to seven previous presidents, and his grade is determined by his performance relative to his predecessors. This allows for a direct comparison between the Trump and Biden economies at the same point in each presidency. The report card reveals why many voters feel they were better off under Trump.
One of the most significant metrics is average hourly earnings adjusted for inflation. This single chart may explain why Biden is struggling with voters more than any poll. Real incomes have dropped by about 1% since Biden took office, while under Trump, real incomes were up by about 3%. Biden’s underperformance can be attributed to inflation, which has risen more than nominal income during his term. It is worth noting that Biden is not the worst performer in this measure; that distinction goes to Jimmy Carter and George H.W. Bush, both of whom lost their reelection bids.
However, there is some positive news regarding inflation-adjusted income. Real income growth has turned positive earlier this year, meaning incomes are now growing faster than inflation, and consumers are regaining lost purchasing power. This positive trend might improve voter attitudes toward Biden and help him recover from his current position.
President Biden often emphasizes what’s going right with the economy, including the strongest overall job growth of any president in history, surpassing even Trump. Manufacturing employment is also a bright spot for Biden, with only Jimmy Carter performing better when manufacturing played a more significant role in the economy.
Despite the economy generally performing well under Trump before the COVID-19 pandemic, GDP growth has been slightly stronger under Biden. The Biden administration also outperforms the Trump administration in terms of US exports, as Trump’s trade war had negative consequences.
The only area where Trump surpasses Biden is in stock market performance. However, stocks have still risen under Biden, and the chart provided in the article only goes up until the end of October, not capturing the 8% rally since November 1st. Additionally, the stock market has less impact on voter attitudes compared to issues like income and job security.
Overall, the Biden economy looks good on paper, but it faces the challenge of high inflation that has eroded living standards. The good news is that inflation is improving, with rates falling from a peak of 8.9% in 2022 to 3.2% currently. Most economists predict that inflation will continue to decrease and return to normal ranges by the end of 2024. By the time of the 2024 Election Day, the data may show that average Americans are slightly better off than they were four years ago. However, Biden’s challenge lies in convincing them to believe it.
In conclusion, President Biden’s reelection campaign is hindered by the public’s lack of trust in his handling of the economy. Despite positive economic indicators in terms of job growth, manufacturing employment, GDP growth, and trade, the issue of inflation and its impact on living standards remains a significant concern. Biden’s task is to convince voters that they are better off under his leadership, despite the prevailing sentiment that they were better off under Trump.
