Nobody on planet Earth has more chutzpah than former president Donald Trump. After claiming over and over again that the stock market would crash if Joe Biden became president, in light of the market reaching yet another high this week, he had the audacity to claim — in all caps no less —“THIS IS THE TRUMP STOCK MARKET BECAUSE MY POLLS AGAINST BIDEN ARE SO GOOD THAT INVESTORS ARE PROJECTING THAT I WILL WIN, AND THAT WILL DRIVE THE MARKET UP." He always finds a way to blame others for his failures and take credit for others' successes. And his followers never seem to notice how obviously dishonest he is about it.
Joe Biden, on the other hand, is brushing off the stock market's stellar performance even though he could take credit since every president is largely held responsible for economic conditions during their term, whether it's fair or not. But unlike Trump, he is required to act like a normal human being and the stock market isn't really relevant to most people. Yes, plenty of people have retirement savings in their 401ks but for the most part, this particular economic indicator doesn't tell the average American much about their everyday economic lives.
That doesn't mean Biden doesn't have a good story to tell about this economy and his administration's accomplishments, however. While many in the media have been flogging the doom and gloom of the post-pandemic recovery, both reflecting and creating a narrative of economic angst, the facts on the ground have been looking positive for a while. Now they are starting to look downright stellar and it's not just the stock market.
Friday's job report was chock-full of objectively fantastic economic news. The U.S. economy added 353,000 jobs in January, far exceeding economists' expectations of 180,000 jobs. With last month's jobs gains revised upwards to 333,000, the unemployment rate now stands at 3.7%. There is even good news on the stubbornly high inflation front. The Washington Post published a piece this week with the headline, "Falling inflation, rising growth give U.S. the world’s best recovery." Friday's report confirms that wage growth has outpaced inflation by over a full percentage point over the past year.
Even Larry Kudlow, Trump's former economic adviser and current Fox Business host, had to tip his hat to reality this week.
Kudlow on the economy: From bust to slump to “I was wrong” pic.twitter.com/HjygBNLfe9
— Acyn (@Acyn) February 2, 2024
Here's just a short list of all the good economic indicators that have been there for quite some time now and are only now being acknowledged by the likes of Kudlow and, finally, the mainstream press as well, gathered by Democratic strategist Simon Rosenberg, for his newsletter:
-Best job market since the 1960s, stock market setting records (401Ks are happy), best recovery in the G7, GDP growth 3.3% last quarter, consumer sentiment rising
-The inflation fueled by COVID/supply chain disruptions, the Russian invasion of Ukraine and OPEC price hikes has ended, and we are now in a place much closer to historic norms. Prices for many items are falling including groceries, rents and mortgage rates [and people are starting to notice.]
-Historically elevated wage growth, new business formation and prime-age worker participation rates. In the last few months we’ve seen some of the most robust real wage growth we’ve seen in decades, and Americans at all income levels have seen sizeable increases in their overall net worth
-Lowest uninsured rate in history, record ACA signups this year
-Renewable and domestic oil production set records in 2023, US more energy independent than its been in decades. In 2023 the US produced more oil than any country has in any year in history
There is a view among political mavens that it's a bad idea to talk about the good economic news. "People aren't feeling it" they say, and they get mad when you tell them that they should be feeling good when they aren't. "Talk about what you plan to do to help them out of their troubles if you get another term" they say, "make them understand that you feel their pain." That might make sense if those statistics didn't belie that reality and if the sour responses weren't so colored by partisanship.
The New York Times' Paul Krugman has been tracking this phenomenon:
I’ve been writing about the recent improvement in reported consumer sentiment, which is really startling; here’s a chart from the Michigan consumer survey. In the release containing that chart, the survey notes that “Sentiment is now just 7 percent shy of the historical average since 1978.”
Reading that, I couldn’t help thinking about recent work by Ryan Cummings and Neale Mahoney in which they estimate the extent to which partisanship moves these numbers. Both sides of the aisle are more negative about the economy when the other party holds the White House, but the effect is much stronger for Republicans. Adjusting for this effect, they find, raises consumer sentiment by seven points, or around 10 percent — more than enough to bring current consumer sentiment above the historical average.
The good news is that people are starting to feel it, even if they aren't yet ready to accept that it might actually be real. The pandemic was a terrible jolt to the entire world economy and when you combine that horrible experience with the trauma of four years of Trump culminating in a coup attempt and insurrection it's not surprising that the American public has been suffering from mass PTSD. And this has been exacerbated by a coordinated right-wing propaganda effort and a mainstream media that has been relentlessly perpetuating the narrative that the country is in dire economic straits.
You can see the results in polling that has shown for months that a majority of people feel good about their own financial circumstances but believe that the rest of the country is in economic crisis. Why? Because that's what they are being told. When the media narrative changes, their views on the broader economy change too, and that's starting to happen.
The Wall Street Journal reported, "consumer sentiment leapt 13% in the first half of January from December, the Michigan survey said, after a sharp rise the prior month. The pickup in sentiment was broad-based, spanning consumers of different age, income, education and geography." They also point out that some of this rise in confidence comes from the shift in the press in recent weeks:
Media coverage might be rubbing off on consumers, too. The mood of economy-related articles has rebounded since November to the highest level since 2018, according to the San Francisco Fed’s Daily News Sentiment Index. Coverage had skewed much more negatively in the past three years relative to economic fundamentals, a Brookings Institution analysis found.
It is unknown if the strong economic news will be enough to boost the Democrats next November and prevent Donald Trump's restoration to the presidency. It's still a long road to bringing Joe Biden's approval rating up after having been ruthlessly battered by the bad press on this issue over the past three years and there is no time to waste. But the economy is always a primary concern in any presidential election and having a good one is certainly an asset.
Just in case, it might be wise for the Democrats to revisit this famous ad and think about updating it with an accurate picture of America in 2024. (Even in 1984, the whole country wasn't white...) Voters may just be getting ready to hear this message:
