Understanding Biden’s Poll Numbers Despite a ‘Strong Economy’
The Biden team keeps talking about how they can’t believe how underwater the President’s poll numbers are, when the economy is so frickin’ good. “As soon as people figure out how frickin’ good it is, they’ll come running to vote for him.”
At some level, one can be sympathetic with that view. Inflation is down to only 3.1%, the Unemployment Rate is still sub 4% even with the most-recent rise, well below the levels when he took office; Average Earnings are up and gasoline prices are down around $3 after being above $5. What’s not to like? Moreover, put this record next to Trump’s record! When Trump came into office, Unemployment was 4.7% and when he left it was 6.7%!
The problem that the Biden team has – and, frankly, the one it has always had – is that they have no idea how actual people experience the economy, and no idea how actual people think.
Americans, on average, tend to be fair. When people think about the Trump years, they recognize that it isn’t quite fair to saddle him with COVID. While they don’t think this explicitly, their memories about the 2016-2020 period fall into “pre-COVID” and “post-COVID” zones. In other words, if in mid-March 2020 a particular consumer was positively disposed towards the Trump economy, then that’s what their memory is. When COVID hit, it started a new time period in their memory. So to the normal person, they remember Trump coming in with a 4.7% Unemployment Rate and watching as it fell to 3.5% in February 2020. “Then COVID hit.” This works against Trump in little ways too; no one gives him credit for the disinflation that happened between March 2020 and the end of his term.
So this is the way that normal people see Trump’s record:
Now, the best part of Biden’s record is that Unemployment fell from 6.7% when he took office to 3.7% as of January. Other than that, though, his record in the minds of Americans looks unimpressive. (Of note is – and folks, don’t shoot the messenger; I’m just showing the data – that the Biden team persistently claims that real earnings have risen during his Administration, while it isn’t so.)
And so now, let’s put them side by side. Inflation is higher under Biden, gasoline prices have risen under Biden, real earnings are down under Biden, and food costs are up (a lot) under Biden. The unemployment rate has fallen more, but is now higher than it was pre-COVID under Trump!
If you realize that Americans are not going to blame Trump for COVID, then it gets very easy to understand why Trump polls better on the economy.
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What is the main reason of the inflation during the Biden period? I understand it was mainly due to the excess of money input into the monetary system during the pandemia. How that factor should be accounted for when comparing both periods?
Well, I guess that goes really to the question of who to blame! Yes, too much money and also fiscal actions taken to flush that money vigorously into the system, while restraining output (by, for example, paying people to stay home). Primary blame goes to the Fed but the major spending bills that passed through Congress and the President(s), plus things like the eviction moratorium and other executive actions…lots of blame to spread around.
I think the real critique of the Biden Administration on that score isn’t so much the causing of the initial inflation but rather the active efforts to deny it actually existed, and then a lack of any effort to reverse or resist it.