Today: 19-04-2024

Biden's Economic Report Card: Navigating Fragile Advantages in a Complex Landscape

Navigating the Economic Chessboard: Biden's Fragile Advantage on the Eve of 2024

WASHINGTON, Nov 9 (Reuters Breakingviews) — With 362 days until the 2024 U.S. presidential election, the political strategist James Carville's famous mantra, "it's the economy, stupid," echoes through the corridors of power. The next few months are poised to define Joe Biden's economic legacy, ultimately shaping his prospects for reelection. Despite the White House extolling the virtues of "Bidenomics," public sentiment remains unconvinced. An October poll by the Economist and YouGov reveals that over 50% of households disapprove of the president's economic stewardship. As Americans consistently rank the economy as their top concern for the 112th consecutive week, according to Reuters and Ipsos polling, Breakingviews has constructed a tentative scorecard examining Biden's performance across ten economic categories. The current assessment places the leader of the free world on a precarious perch.

President Biden's inaugural legislative triumph in March 2021 delivered a substantial blow to pandemic-induced economic woes. The $1.9 trillion stimulus package injected financial lifeblood into the U.S. economy. Featuring measures like $1,400 payments to households, extended unemployment benefits, and an expanded child tax credit, the package substantially slashed overall poverty by 44%, as per the Brookings Institution. This financial adrenaline propelled households' disposable income to a record $20 trillion post-inflation approval, per the Bureau of Economic Analysis. Major retailers, from Walmart to Nordstrom, credited the stimulus with revitalizing consumer demand. However, as the echoes of these spending incentives have faded, so has the public's approval of Biden's economic stewardship.

A pivotal aspect of Biden's narrative, however, is his $1 trillion infrastructure plan, approved by Congress in November 2021. Fulfilling a key campaign promise, the plan promises a facelift for the nation's roads and bridges, coupled with improvements in clean water and broadband internet accessibility. Projections from Moody's Analytics anticipate the creation of an additional 600,000 jobs by the close of next year and 800,000 jobs in 2025. This significant investment lays a solid foundation for Biden's case when the electoral debates unfold.

As the nation anticipates the political and economic chess moves leading up to the 2024 election, Biden's economic scorecard bears the weight of both triumphs and challenges, underscoring the fragility of his current advantage.

Biden's Legislative Canvas: Winning Strokes and Political Dynamics

In the intricate tapestry of President Joe Biden's legislative endeavors, recent verdicts suggest a mixed but impactful scorecard. As the clock ticks towards the 2024 election, each bill becomes a brushstroke, shaping not only economic policies but also political narratives.

First in the spotlight is the infrastructure bill, a rare bipartisan victory that transcends party lines. The passage of the "Chips and Science" plan not only supports American companies like Deere and Caterpillar but cements Biden's industrial-policy legacy. Crucially, the bill, backed by a significant number of Republicans, showcases the art of bipartisanship, giving Biden a unique flex on the political stage. This strategic win is undeniably a feather in Biden's cap.

The bipartisan spirit extends to the realm of semiconductors and technological independence from China. With over 460 companies expressing interest in the plan's $53 billion in research and production subsidies, the public-private investment dynamic becomes a point of pride. Major corporations like Micron Technology and Intel making substantial commitments underscore the tangible impact of this legislation. While both parties may tout their support on the campaign trail, the narrative of successful bipartisanship disproportionately benefits Biden.

However, not all bills bask in the glow of bipartisan camaraderie. The most recent spending bill, devoid of Republican support, serves as a platform for Biden to reinvigorate progressive proposals. Despite the reduction from $1.8 trillion to $430 billion in new spending, the bill encompasses key elements of Biden's agenda, including clean energy tax credits and Medicare drug price negotiation. This strategic move positions Biden to leverage progressive policies in the lead-up to the 2022 midterm elections.

Bank of America estimates a substantial economic ripple effect from this spending, with $132 billion already catalyzing over 270 new clean energy projects. Interestingly, predominantly Republican states, like Texas and West Virginia, stand to gain significant rewards in clean energy production, making criticism from across the aisle more challenging. In this context, Biden secures another win, strategically advancing his agenda while navigating the intricacies of a divided political landscape.

As the legislative canvas continues to evolve, the brushstrokes of these bills tell a story of strategic victories, bipartisan alliances, and the delicate dance of political dynamics in anticipation of the 2024 election.

Navigating the Economic Crossroads: Biden's Wins, Draws, and Potential Losses

As President Joe Biden steers the economic ship through turbulent waters, a nuanced evaluation reveals wins, draws, and potential losses in his administration's economic policies.

On the employment front, Americans aged 25 to 54 are clocking in at the highest rate in two decades, a testament to Biden's emphasis on workforce engagement. Deeming himself the most "pro-union president" in U.S. history, Biden capitalizes on the resurgence of union popularity, with two-thirds of Americans approving of unions—an unprecedented figure since the labor movement's peak in the 1960s. However, the upcoming year poses challenges, with job creation slowing amid high borrowing costs, prompting caution in business growth plans. The Federal Reserve's projection of a rise in unemployment to 4.1% suggests potential job losses for half a million individuals. The president's pro-union stance may face headwinds, as exemplified by the impact of the United Auto Workers strike on economic growth, according to consulting firm RSM. Despite potential hurdles, Biden currently holds the upper hand on the job front.

In the realm of housing, Biden's initiatives to shore up the supply of U.S. homes, from increased investment in manufactured homes to reduced barriers to residential zoning, reflect proactive measures. However, the housing shortage persists, with Realtor.com reporting a deficit of 6.5 million homes. Congressional inaction, coupled with rising mortgage rates and a slump in home construction, results in a drawn verdict—a testament to both progress and persistent challenges.

Federal spending initiatives have undeniably impacted prices, contributing to rapid inflation—a critical factor in households' growing economic pessimism. While the inflation rate has receded to 3.7% in September from the peak of 9% in June 2022, the recovery journey is far from over. The Federal Reserve's proactive response, including a historic interest rate increase, aims to combat inflation but comes with potential financial pain for households. The enduring impact on voters, coupled with any subsequent economic slowdown from higher rates, places this aspect in the Biden loss category.

As Biden navigates the economic crossroads, the verdict is a mosaic of achievements, ongoing challenges, and potential pitfalls. The dynamic interplay of these factors will undoubtedly shape the economic narrative, influencing public sentiment and, ultimately, the political trajectory of the Biden administration.

Biden's Economic Odyssey: Wins, Losses, and the Race Against Time

As President Biden navigates the economic landscape, the scorecard reflects a nuanced narrative of victories, setbacks, and an impending race against time.

Biden's campaign promise to forgive substantial student debt faced a formidable hurdle in June when the Supreme Court blocked his executive order to erase $430 billion in student debt. This setback, affecting 26 million borrowers, underscores the challenges in fulfilling this commitment. While the president has forgiven $127 billion through smaller actions, the looming $1.8 trillion student loan burden casts a shadow, resulting in a Biden loss in this arena.

The performance of the S&P 500 Index during Biden's first term reveals a mixed picture. Despite a decent 8% increase, the average annual return of 10% since 1957 paints a more subdued backdrop. The benchmark's nearly 10% dip from its peak in January 2022 and the bond market's struggles, experiencing the worst three-year rout since 1776, contribute to the economic complexity. Investors' concerns, driven by government debt, rising interest costs, and congressional dysfunction, provide fodder for discontent, leading to another Biden loss.

Biden's wins in stimulus, infrastructure, and clean energy initiatives come with a hefty price tag—the federal government's debt has swelled by over $5 trillion during his first term, reaching a historically elevated 119% of GDP by the end of 2022. Despite enacting new taxes to address the budget shortfall, deficits have remained at least 40% larger than pre-pandemic levels each year. The confluence of higher interest rates and increased debt service costs poses a potential challenge for Biden on election day, marking another loss in the economic scorecard.

Housing and jobs emerge as bright spots, providing Biden with a strong foundation for the upcoming campaign. Yet, the persistent specters of inflation, volatile markets, soaring interest rates, and escalating government spending inject uncertainty into the equation. While the economic scorecard currently tilts in Biden's favor, the race against time intensifies, shaping the narrative of his economic legacy.

Follow @BenWinck on X (The author is a Reuters Breakingviews columnist. The opinions expressed are his own.)

Bidenomics Unveiled: Navigating Success and Scrutiny in 2023

As U.S. President Joe Biden steers the economic ship into the realm of reelection, the narrative of "Bidenomics" unfolds, weaving a tale of successes and critiques.

Biden's tenure in the first term boasts a historically low unemployment rate of 3.4%, a testament to the efficacy of his economic policies. Throughout 2023, the president has proudly championed the merits of "Bidenomics," positioning it as a cornerstone of his reelection campaign. The emphasis on job creation and the subsequent decline in unemployment serves as a central pillar in his economic narrative.

However, the path has not been without its challenges. Critics, including former president and 2024 frontrunner Donald Trump, have pointed fingers at Biden's spending packages, holding them responsible for the peak inflation of 9% witnessed in June 2022. The juxtaposition of low unemployment and persistent inflation has fueled debates on the true impact of Biden's economic strategies.

As the president readies himself for the reelection campaign, the clash of messaging intensifies. Bidenomics becomes a battleground of ideas, where successes and criticisms vie for dominance in the economic narrative. The scrutiny from conservative opponents adds layers of complexity to the story, underscoring the delicate balance between economic achievements and the challenges that demand acknowledgment and resolution.

Editing by Lauren Silva Laughlin, Sharon Lam, and Aditya Sriwatsav

Our Standards: The Thomson Reuters Trust Principles.

Navigating the Economic Tapestry of Biden's Legacy

As President Joe Biden stands at the crossroads of reelection, the economic tapestry woven by "Bidenomics" reflects a complex interplay of achievements and criticisms. The pride in a historically low unemployment rate of 3.4% resonates as a significant triumph, emblematic of the administration's commitment to job creation and economic stability.

However, the narrative is not immune to the critiques voiced by conservative opponents, notably spearheaded by former President Donald Trump. The peak inflation of 9% in June 2022 serves as a focal point of contention, with opponents attributing it to the consequences of Biden's ambitious spending packages.

The clash of messaging intensifies as Biden gears up for the reelection campaign, where the merits of "Bidenomics" become a battleground of ideas. The delicate balance between economic successes and acknowledged challenges defines the narrative, shaping public perception and influencing the political trajectory.

In this intricate dance of policy and critique, the conclusion remains elusive, leaving the final chapter of Biden's economic legacy unwritten. As the nation awaits the unfolding chapters, the economic tapestry continues to evolve, reflecting the resilience, adaptability, and challenges that characterize the journey of "Bidenomics" in the landscape of American politics.