Former President Donald Trump enjoys touting the pre-coronavirus economy as the strongest in the nation’s history. His 2024 campaign site says it set records for median household income and African American unemployment, among other measures.
Trump’s statements, however, are out of date. Those records, and many other economic accomplishments Trump has claimed, have been surpassed by the man who beat him in 2020: Democratic President Joe Biden.
This week, the Biden White House went on a very determined charm offensive to convince voters that no matter how they may feel or what Republicans say, the American economy is actually in very good shape. The numbers show that the White House has a sterling case to make, and its success could be the deciding factor in whether Biden can defeat Trump for a second time.
“Today, the U.S. has had the highest economic growth rate, leading the world economies since the pandemic. The highest in the world,” Biden said during a speech Wednesday in Chicago. “And folks, that’s no accident. That’s Bidenomics in action.”
“Today, the U.S. has had the highest economic growth rate, leading the world economies since the pandemic. The highest in the world.”
– President Joe Biden
By the numbers, the White House’s pitch is strong, with one very obvious exception: inflation.
On employment, the Labor Department said 161 million Americans were employed in April, marking the highest level ever and surpassing the previous peak of 158.8 million under Trump.
As for median household income, it hit a record $70,784 in 2021, above the $68,703 peak of 2019.
Even the record for lowest African American unemployment, which Trump has repeatedly bragged about in his appearances, now belongs to Biden.
In August of 2019, it fell to a then-record 5.3%. In April of this year, it dropped from 5.0% to 4.7%. Perhaps more importantly, the gap between white and Black joblessness, a long-standing phenomenon that many analysts at least partially attribute to racism, shrunk to its lowest size ever in May, at just 1.6 percentage points.
Trump-claimed records for other groups, like lowest joblessness for women in decades and for Latinos, now belong to Biden as well. (Asian American unemployment remains a Trump record, as it hit 2.2% in May of 2018 while Biden has seen it dip to 2.4% twice.)
And when the overall jobless rate hit 3.4% in both January and April of this year, it not only beat the Trump low of 3.5%, but it also marked a level that had not been seen since May 1969, shortly before Neil Armstrong took his “one small step” for man.
Yet for all of these numbers, surveys continue to show that many Americans remain gloomy about the economy. In a spring survey for financial services giant Nationwide, 68% of respondents said they expected a recession in the following six months. They also expected that downturn to be harsh, with 62% saying they expected it to be as bad as or worse than the 2008 crisis.
In a June poll for NBC News, 74% of respondents said they believed the country was on the “wrong track,” the highest reading for that measure since August.
The White House’s solution to this grim outlook? A public relations blitz.
Beyond Biden’s Chicago speech, the White House has pressed its message about the economy more aggressively, issuing memos, slide decks and fact sheets about the economy; coordinating the release of three major studies on inflation, manufacturing and green energy jobs across the administration; and announcing the “Investing in America” tour, which will see eight different Cabinet secretaries visit 15 different states to talk about the economy.
Another part of the push was having Lael Brainard, the director of the National Economic Council and a former vice chair of the Federal Reserve, join the White House daily press briefing Tuesday and attend a breakfast Thursday with reporters that was sponsored by the Christian Science Monitor.
ANDREW CABALLERO-REYNOLDS via Getty Images
Describing the tour Thursday, Brainard said, “You’ll see a number of Cabinet secretaries and White House officials every day who are traveling to announcements where they are welcomed by local officials because there’s a groundbreaking or a ribbon-cutting.”
Brainard also said the final reading on first-quarter gross domestic product, which was released Thursday and showed a 2% annual growth rate, was evidence that “the economy remains resilient, inflation is continuing to come down and consumers continue to be healthy.”
Republicans, perhaps unsurprisingly, don’t see it that way.
“What you’re seeing, sewn into the fabric, is making this country beholden to their radical agenda, which is going to cement higher cost of goods and services and energy, because we’re spending so much federal dollars, through the Inflation Reduction Act, to pursue their environmental agenda,” Rep. Chip Roy (R-Texas) told HuffPost last week.
“I think we’re headed for a recession, whether it’s mild or severe, I don’t know, just because of interest rates,” said Rep. Mike Simpson (R-Idaho).
But the main thing that Republicans point to is inflation, which has come down from the galloping pace seen in 2022 but remains elevated compared with the Trump era.
“I think we’re headed for a recession, whether it’s mild or severe, I don’t know, just because of interest rates.”
– Rep. Mike Simpson (R-Idaho)
Roy said his constituents are still feeling the pain of inflation, even if it has eased some. “They’re unable to navigate through their daily or weekly or monthly budgets, for food and for basic necessities,” he said.
Indeed, when adjusted for inflation, Biden’s numbers don’t look quite so rosy. Real median household income peaked in 2019, and GDP, instead of growing by almost $5 trillion since peaking in the fourth quarter of 2019, grew by only about $1 trillion after inflation.
But the White House points out that, compared with the other major global economies belonging to the so-called G7, the United States has had the tamest core inflation for prices outside of energy and food. And year-over-year inflation ― the pace of price growth compared with the same month a year ago ― has been down for 11 months straight.
Brainard acknowledged that Americans may not yet see how well the economy is doing, attributing the lag in perceptions to the unique double whammy of the pandemic followed by inflation caused by the war in Ukraine.
“Those are pretty traumatic economic events, and it’s going to take a while for people to feel really confident and secure,” she said.
Kathy Bostjancic, the chief economist at Nationwide, said that inflation explains the gloomy assessments of the economy overall.
“Those are pretty traumatic economic events, and it’s going to take a while for people to feel really confident and secure.”
– Lael Brainard, the director of the National Economic Council
“It is the inflation. We’d have to go back to the 1970s or ’80s and it still wasn’t quite the same,” she said. “It is a very different cycle.”
Aside from inflation, though, the White House’s big problem may be the potentially self-fulfilling expectations of a recession. It got some good news this week when consumer confidence posted its highest level since January 2022.
But the part of the index that measures how consumers feel about the future remained just below the level associated with a recession happening within a year.
Bostjancic said her team had pushed back its prediction for a moderate recession to now start in the fourth quarter of 2023. But Brainard said the economy has been defying recession forecasts all year.
“We’ve heard these predictions. They always come in three months, always in six months, right? And then the three months passes or the six months passes,” she said Thursday.
“So it’s hard not to conclude maybe, maybe, the economy is actually kind of resilient and kind of chugging along — doing, you know, pretty well.”