The Washington Monthly Newsletter: December 12, 2023
“Why Biden should keep touting Bidenomics” and the latest from the Washington Monthly website.
The post The Washington Monthly Newsletter: December 12, 2023 appeared first on Washington Monthly.
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Why Biden should keep touting Bidenomics
Today we received more positive economic data in the Consumer Price Index (CPI) report, with November prices rising just 0.1% from October, and November’s year-to-year inflation ticking down from October’s 3.2% to 3.1%. Food at home prices gained only 0.1% from October, and energy costs dropped for the second straight month.
A few days ago we learned the November unemployment rate declined from 3.9% to 3.7%. This is the 22nd straight month with unemployment below 4%—the longest such stretch in more than 50 years.
And yet, President Joe Biden’s polls regarding job approval and handling of the economy remain terrible, prompting media narratives about how the economy isn’t as good as the data suggests, and the public isn’t buying the “Bidenomics” messaging from the White House.
Is this a failure of messaging? Of policy?
We have answers. But first, here’s what’s leading the Washington Monthly website:
- Why Biden’s Good Economic News Hasn’t Helped Him Politically—So Far: Contributing Writer Robert J. Shapiro explains that while past declines in real disposable income have hurt Biden, recent gains are encouraging. Click here for the full story.
- The Trouble with Polling Third-Parties: Jacob Indurksy, former Monthly editorial intern, warns that early poll data about third-party and independent candidates can be highly misleading. Click here for the full story.
- Canceling Liz Magill Will Be Bad News for Free Speech: Jonathan Zimmerman, University of Pennsylvania professor of history and education, argues Magill’s ouster will prompt a new era of ham-fisted speech codes. Click here for the full story.
Shapiro’s article explains that what’s been dragging Biden down may soon lift him up.
Over the course of his presidency, real disposable income (which factors in inflation) is down 8.1 percent. But that’s mostly driven by the horrid inflation of 2021 and 2022.
From October 2022 to October 2023, as inflation cooled, incomes are up 3.3 percent—not yet a full recovery but on the right track.
Biden’s position, as he winds up his third year in the presidency, resembles Barack Obama’s.
During the Great Recession, concern was not inflation but jobs. Just before Obama was sworn in, the unemployment rate was 7.3%. It peaked at 10% in October 2009, and then—as Obama’s stimulus program kicked in—experienced a slow decline.
By the end of his third year in office, unemployment reached 8.5%—not yet a full recovery, but on the right track. At that point, Obama’s average job approval was slightly underwater.
Unemployment kept slowly falling, reaching 7.8% by Election Day. Obama’s job approval was middling most of 2012, not clearing 49% until September. But he won re-election by 4 percentage points.
As I wrote a few months ago, Biden is not the first president to suffer delayed credit for economic improvements. Obama, as well as Bill Clinton and Ronald Reagan, had similar mid-term frustrations that dissipated in time for Election Day.
More important than the message is the substance. As Shapiro notes, “continued solid economic performance” is the key to Biden’s re-election.
Fortunately, further cooling of inflation appears on the horizon. The chief market strategist at the global finance company Lazard told The New York Times that while shelter costs were higher in today’s inflation report, “The next step down in inflation will likely be driven by shelter where price pressures have decreased significantly over the last year but are not yet evident in the CPI data.”
What the experts see ahead is not what average people see ahead. A November poll of Michiganders by the Detroit Chamber of Commerce found that only 17 percent believed inflation would get better next year.
To the extent that messaging matters, the challenge for Biden is to acknowledge the lingering effects of the past disruptions while citing tangible signs of progress that people can recognize and instilling confidence about the future.
That allows him to tout the role that “Bidenomics”—domestic manufacturing investment, infrastructure rebuilding, renewable energy production, antitrust enforcement—is playing in that future.
Sometimes when a message isn’t working, you have to cut your losses. But presidencies usually rise and fall on economic performance. Biden has to sell his, and he has a good product to sell.
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Best,
Bill
The post The Washington Monthly Newsletter: December 12, 2023 appeared first on Washington Monthly.