Associated Press
President Joe Biden goes into next year’s election with a vexing challenge: Just as the U.S. economy is getting stronger, people are still feeling horrible about it.
Pollsters and economists say there has never been as wide a gap between the underlying health of the economy and public perception. The divergence could be a decisive factor in whether the Democrat secures a second term next year. Republicans are seizing on the dissatisfaction to skewer Biden, while the White House is finding less success as it tries to highlight economic progress.
“Things are getting better and people think things are going to get worse — and that’s the most dangerous piece of this,” said Democratic pollster Celinda Lake, who has worked with Biden. Lake said voters no longer want to just see inflation rates fall — rather, they want an outright decline in prices, something that last happened on a large scale during the Great Depression.
“Honestly, I’m kind of mystified by it,” she said.
‘Bidenomics’ will be tested in 2024
Pollsters and economists say there has never been as wide a gap between the underlying health of the economy and public perception.
- Easing inflation in 2023 has raised hopes for a gentler Federal Reserve and a strong stock market in 2024.
- However, small businesses have been both hopeful and anxious about the holidays, taking a cue from their customers.
- Many Americans said in an AP-NORC poll that their household expenses are outpacing earnings, and they worry about their financial futures.
By many measures, the U.S. economy is rock solid. Friday’s employment report showed that employers added 199,000 jobs in November and the unemployment rate dropped to 3.7%. Inflation has plummeted in little over a year from a troubling 9.1% to 3.2% without causing a recession — a phenomenon that some once skeptical economists have dubbed “immaculate.”
In a possible warning sign for Biden, people surveyed for the index brought up the 2024 election. Sentiment rose dramatically more among Republicans than Democrats, potentially suggesting that GOP voters became more optimistic about winning back the White House.
“Consumers have been feeling broadly uneasy about the economy since the pandemic, and they are still coming to grips with the notion that we are not returning to the pre-pandemic ‘normal,’” Joanne Hsu, director and chief economist of the survey, said of the overall trend in recent months.
Jared Bernstein, chair of the White House Council of Economic Advisers, stressed that a strong underlying economy is “absolutely necessary” to eventually lifting consumer sentiment. His argument is that as the economy continues to improve, more people will recognize the benefits and sentiment will improve.
“We’ve got to keep fighting to lower costs and build on the progress that we’ve made,” Bernstein said. “We just need more time to get these gains to working Americans — that’s our plan.”
The White House has made three major shifts in its messaging in hopes of building up confidence in Biden’s economic leadership. The president this summer began to pepper his speeches with the term “Bidenomics” to describe his policies, only to have Republicans latch onto the word as a point of attack.
White House officials have pointed out specific items for which prices have fallen outright. They noted lower prices for turkeys during Thanksgiving as well as for eggs. Biden repeatedly emphasizes that he lowered insulin costs for Medicare participants, while other officials discuss how gasoline prices have dropped from their peak.
Second, Biden recently started to blame inflation on corporations that hiked prices when they saw an opportunity to improve their profits, bringing more prominence to an argument first used when gasoline prices spiked. The president’s argument is suspicious to many economists, yet the intended message to voters is that Biden is fighting for them against those he blames for fueling inflation.
“Let me be clear: Any corporation that is not passing these savings on to the consumers needs to stop their price gouging,” Biden said recently in Pueblo, Colorado. “The American people are tired of being played for suckers.”
And Biden is now going after the track record of former President Donald Trump, the current GOP front-runner. Biden’s campaign sent out a statement after Friday’s employment report that said, “ Despite his claims of being a jobs president, Donald Trump had the worst jobs record since the Great Depression, losing nearly three million jobs.”
The Republican counter to Biden has been to dismiss the positive economic data and focus on how voters are feeling. As the annual inflation rate has fallen, GOP messaging has focused instead on multi-year increases in consumer prices without necessarily factoring in wage gains. And Republican lawmakers have argued that people should trust their gut on the economy instead of the statistics cited by Biden.
“Joe Biden’s message to them is just this: He says don’t believe your lying eyes,” Sen. John Barrasso, a Wyoming Republican, said in a recent floor speech.
Biden’s speeches over the past two years has done little to improve his anemic polling on the economy. Administration officials had once assumed that better economic numbers would overcome any doubts among voters, only to find that the negativity stayed even as the U.S. economy became likely to avoid a recession once forecasted by economists.
Claudia Sahm, a former Federal Reserve economist, has been surprised by the anger generated online when she has noted the signs of a strong economy.
A typical U.S. household is better off than it was in 2020. Inequality has lessened somewhat in recent years as wage growth has favored poorer workers. Yet people still seem rattled and disconnected by the shock of the pandemic, the arrival of government aid and the inflation that followed as hiring improved.
“People have really been jerked around,” Sahm said. “Things have been turned on and off. Everything has moved fast. It’s been disruptive and confusing. We’re just tired.”
There is no solitary cause for this gap between the major data and public feeling. But the experts trying to make sense of things have multiple theories about what’s going on. Besides the pandemic’s impact, it’s possible that social media has distorted how people feel about the economy as they watch the posh lifestyles of influencers. Many people also judge the economy based on their own political beliefs, rather than the underlying numbers.
It could simply be that people need time to adjust after a period of rising inflation. As a result, there’s a lag before a slowing rate of inflation boosts how consumers feel, according to a recent analysis by the economists Ryan Cummings and Neale Mahoney.
“Sentiment is still being weighed down by the high inflation we had last year,” Cummings said. “As that recedes further into the rearview mirror, its effects are likely to diminish.”
Another possibility is that the loss of pandemic aid from the government left people materially poorer. Millions of households got checks from the government and an expanded child tax credit deposited directly into their accounts. Republicans blamed this funding for feeding inflation, but the money also initially helped to shelter people from the pain of rising prices.
Adjusting for government transfers and taxes, the average annual income for someone in the lower half of earners was $34,800 when Biden took office, according to an analysis provided by Gabriel Zucman, an economist at the University of California, Berkeley.
That average fell to $26,100 by March 2023 in a sign that wage growth could not make up for the loss of government aid.
Samuel Rines, an investment strategist at Corbu, found that companies including Pepsi, Kraft-Heinz, Procter & Gamble and Kimberly-Clark latched onto the higher food and energy prices after Russia’s 2022 invasion of Ukraine to boost their own products’ prices and increase profits.
Earnings reports suggest that consumers started to tire of some companies’ double-digit price increases this summer, prompting those companies to indicate that future prices increases will be closer to the historic average of 2%.
Biden can reasonably argue that companies took advantage of the war in Ukraine and the pandemic to raise their prices, Rines said. But the increases happened 12 to 18 months ago and Biden’s current argument doesn’t apply to what businesses are doing now.
Rines said of the president’s message on price gouging: “It’s pretty much 18 months too late.”
___
Republished with permission from The Associated Press.
27 comments
Earl Pitts "The Ronald's Un-Official Campaign Manager" American
December 11, 2023 at 8:33 am
Good Morn ‘Ting America,
BUZZZ BUZZZ
DOOK 4 BRAINS ALERT
BUZZZ BUZZZ
DOOK 4 BRAINS ALERT
BUZZZ BUZZZ
America as you see it’s just another Dook 4 Brains A. P. piece of propaganda.
BUT EARL WHAT SHOULD WE BELIEVE?
Thank you for asking America. Whenever we see an A. P. article we should attempt to determine what the main focus is and where they are trying to lead you as “Headline Believing Sheeple”.
Then, my Beloved Fans, you believe the exact reverse of the propaganda and move on with your life.
If you can follow my sage advice, you will begin to find political peace by relaxing your sphincter, and moving along to your noble life goal of aspiring to be more like Earl Pitts American in every day in every way.
Thank you Anerica and dont forget:
VOTE DESANTIS
Earl Pitts “LIFE COACH” American
rick whitaker
December 11, 2023 at 8:46 am
WARNING ⚠ TROLL COMMENTBY EARL THE SPHINCTER LOVER
SteveHC
December 11, 2023 at 9:11 am
lol 😉
The *real* problem for the Dems is that their guy is simply not as good at public as a Presidential contender *needs* to be these days; as a result of this he even has difficulty “selling” his administration’s truly substantial, genuine successes.
SteveHC
December 11, 2023 at 9:15 am
– Sorry, “not as good at public *speaking* as a Presidential contender…” Still no way to edit or correct inadvertent typos or other errors here…
FloridaPatriot
December 12, 2023 at 1:26 pm
You have NO beloved fans.
rick whitaker
December 11, 2023 at 9:24 am
steveHC, being an ultra progressive dem, i was surprised how well biden has done. the only thing i fault him for is his support of the ultra right-wing nutinyahoo gov. with the prevalence of agist mentality he needs help. if taylor swift came out forcefully in support of biden right before the election, that would help a lot.
Impeach Biden
December 11, 2023 at 9:47 am
An ultra progressive living in Tennessee. That must go over very well everywhere outside of Nashville. Lots of progressives attending NASCAR races. You should have moved to a progressive state like Kalifornia, Oregon, or Washington. Then again you probably don’t want to pay those high taxes for progressive programs that exist in those states. Kind of like the hypocrisy of “sanctuary cities” and then the progressive governments there pull the rug from under the illegals.🤣
Earl Pitts "The Ronald's Un-Official Campaign Manager" American
December 11, 2023 at 10:03 am
Good Morn ‘Ting Rick and Steve,
One of my strictest rules involved with me, Earl Pitts American, continueing on as Taylor’s life coach is that she is not allowed to lie.
So endorseing your man is not an option for her.
However, My Man Rick, your feelings are important to me, Earl Pitts American, so I’ve got a sweet sweet alternative for you.
EARL’S ALTERNATIVE:
You guys can contact Juessy Smollette for a Biden endorsement. Juessy would have no problem with that.
I’m here for you boys and as always I am glad to pop up, unannounced, from time to time with free “Life Coaching” anytime y’all need my assistance.
Earl Pitts “Part-Time Life Coach” American
rick whitaker
December 11, 2023 at 6:02 pm
CAUTION ⚠ TROLL COMMENT BY DEMENTIA EARL THE UNFUNNY FOOL
Richard Russell
December 11, 2023 at 11:03 am
Economy is improving – for who? The fat cats who are Biden’s cronies are cashing in, while the average American is having to cut back on all of life’s essentials. So who do you believe thinks the economy is improving?
PeterH
December 11, 2023 at 12:47 pm
I’m far from a fat cat in retirement here in Florida. The impact of inflation has had zero impact on my purchasing decisions or travel. In fact, I contribute more to charities and understand how workers benefit so I leave 22% -24% gratuities to most servers in restaurants and coffee shops.
rick whitaker
December 11, 2023 at 5:14 pm
richard, the answer to your question is, ME and anybody with an open mind. not the answer you were looking for huh?
FloridaPatriot
December 12, 2023 at 1:30 pm
We all with brains understand that the past administration spent us into this mess and it takes time to get out. Look back at Bush. GOP always puts the economy in a disaster and then tries to blame the Dems when they end of correcting it. Yes, This past 2 years was hard but now we are coming out of it. It is harder to see here in Florida because we have a shyt governor worried more about Disney and drag shows than he does about actually helping his state.
My Take
December 11, 2023 at 12:13 pm
American voters are unfortunately as oafish as they are consumers.
They have been thoroughly conditooned by advertising and propaganda to believe what they are told repeatedly and reasonably skillfully. They have been saturation conditioned for three generations by TV, four by radio, and five or more by newspapers, magazines, and ĺarge signs (e.g., billboards).
The GOPs have been nonstop in declaring imaginary gross failure and national collapse.
The voting pubĺic needs to be forcefully told of Bidin’s successes.
And Trump’s deep dangers.
rick whitaker
December 11, 2023 at 3:58 pm
my take, you seem to see things the way they are and to look behind the curtain. i try to do the same. one of my habits is to analyze adds , commercials, and commentaries for their hidden meanings and real intentions. propagandists do have methods and traits that are discernable if looked at close enough. everyone is fooled some of the time. good comment.
My Take
December 11, 2023 at 10:51 pm
Maybe a decade or so ago I saw in a news article an assessment that really surprised me at first.
It was by a researcher of some applied sort. He claimed that the social science that most closely came to a true science was MARKETING ! Not what I would have giessed. But he explained that good, well-understood, science successfully predicts . . . quantitatively. He said many areas of marketing achieve this. Put X effort into advertising, say, and get a reàsonably predictable Y increase in business)?
My Take
December 11, 2023 at 10:54 pm
Ignore that terminal questiòn mark.
rick whitaker
December 12, 2023 at 6:58 am
my take, thanks for the info. i had a business for 30 years. i never promoted my business. it grew as time went by and i never had a slow period. i went for years at a time without taking a day off. i worked every christmas ,new years etc. my customers would not promote me to others in fear that i would not be available when they needed my services. i had no real competition because i performed better and for less money. i had up to 15 employees at a time. so in my case marketing was not an issue. i finally closed my business when i could no longer find any workers. also i decided that i had enough money and wanted to goof off for a change. i do realise that i was an anomaly in that other people weren’t as fanatical as i was. who in their right mind would not want a day off. the last 5 years have been nice. goofing off is something that i now appreciate. some things just don’t require marketing. my old customers haven’t been able to replace me. i never worried or concerned myself with the money, just the service i was performing. for me the reward was in the work not the money. what a strange story, huh. the people that know me say i am one of a kind. sorry to run on like that, i’m a blabbermouth i guess.
rick whitaker
December 11, 2023 at 1:02 pm
richard russell, blaming biden on the conditions trump helped set up, that is not at all fair. if you knew more about economics, your comment would be different. the maga cult party is the party of grievance, so i understand where you’re coming from. your general lack of basic knowledge is at times unbelievable. try not considering what tucker carlson or steve bannon says before you speak.
Paul
December 11, 2023 at 3:07 pm
Publix net earnings for the nine months ending Sept. 30, 2023 were $3.2 billion, compared to $1.6 billion in 2022, an increase of 93.4%. Earnings per share for the nine months ended Sept. 30, 2023 increased to $0.95 per share, up from $0.48 per share in 2022.Nov 1, 2023
rick whitaker
December 11, 2023 at 3:18 pm
paul, publix is a hardcore maga cultist company, and in florida that will help you a lot. i have boycotted publix since i found out they paid to bus seditionist to the capitol on january 6th. i will never spend one penney there. my family members have all made the same commitment.
Paul
December 11, 2023 at 3:33 pm
I know one of the heirs has supported hard right initiatives though evidentaly she is not involved with the business operation. The company itself tries to stay below the radar.
Dont Say FLA
December 11, 2023 at 5:38 pm
The hand lickers bagging groceries at Publix are paid pennies on the minimum wage’s dollar. It’s legal and that’s the reason they’re there licking their hands to get plastic bags open and putting your groceries in those bags with their perpetually salivated hands.
Kroger / Fred Meyer baggers, on the other hand, are union and don’t drool in your grocery sacks.
Paul
December 11, 2023 at 6:26 pm
I’ve been living in Florida almost 50 years. I know EXACTLY what goes on here. Unfortunately it’s a “right to work” state. I don’t know what they make, but I’m sure Publix pays enough to stay non-union. Neighbor’s kids have bagged, and I also see the same baggers consistently. Fulltimers, I believe, get stock options. Yes I shop at Publix.
If you want to look at a truly nasty industry down here, check out Big Sugar. Or any Big Ag for that matter. They run whatever part of the state they want.
rick whitaker
December 11, 2023 at 9:19 pm
paul, right to work means right to screw your employees over. where i live, krogers has way better prices. i would never ever shop at publix because of their maga cultist ownership
rick whitaker
December 11, 2023 at 5:54 pm
don’t say fla, you are right, but i have one small caveat to your comment. years ago the kroger workers went on strike, the result was they joined a union. the problem was it was a fake union ran by kroger. things may have changed since them, but i don’t know. i do know that a fake inhouse union, is not what i call a real union. like i said, i don’t know if it has changed.
My Take
December 11, 2023 at 11:02 pm
I thought Pubx was employee owned now.
Home Depot has some GOPfascist at the top I’ve read.
Comments are closed.