One of the bitter fruits of President Joe Biden’s single term in office is this: An administration obsessed with policies designed to reduce income inequality actually widened the gap between rich and poor.

That’s the conclusion from Unleash Prosperity’s advance analysis of Census Bureau data on household incomes through the end of 2024.  

These Census Bureau income numbers include business income, investment income, dividends, wages, salaries and most cash government welfare benefits, including Social Security.   

Our chart (below) shows what happened with middle-class incomes over the 48 months of President Donald Trump’s first term (2017-21), as compared to the subsequent Biden term (2021-25). All the numbers in our analysis are adjusted for inflation.

We found that median real household income rose by more than $6,400 under Trump, roughly 11 times the small $550 gain under Biden.

In other words, the middle class mostly treaded water in the Biden years, but enjoyed an income surge through most of Trump’s term. 

The Census Bureau also collects data on the income cut-off for households in the bottom 25% of the income spectrum — that is, the income level a household would have to reach to move out of the bottom 25%.

Under Trump, that cut-off point rose by nearly $3,950; under Biden, it fell slightly, by about $170, suggesting that many lower-income families on average lost purchasing power during the Biden years.

These findings resoundingly contradict Democrats’ frequent claims that Trump’s tax and budget policies primarily favored the rich. In truth, the purchasing power of Americans in the bottom quarter of household income rose by 10% during his first White House term.

And those income gains likely would have been much higher if COVID lockdowns hadn’t choked off large sectors of the economy. 

Median income was up by almost $8,000 in Trump’s three first years — then slipped down in 2020, and stayed low through 2021, Biden’s first year in office.

Also, the income gains reported here are pre-tax.

Trump’s 2017 Tax Cuts and Jobs Act delivered an average tax cut of roughly $1,600 for 80% of American families, meaning the middle-class bump in after-tax take-home pay was actually almost $8,000. 

These findings offer some valuable policy lessons. 

First, inflation is a devastating and regressive tax.

Not even Biden’s large cash welfare benefits could reverse the silent-killer effect of inflation’s 22% cumulative price hikes in gas, groceries and rents from 2021 to 2024.

Second, Trump’s 2017 tax policies — which were and still are ridiculed as “tax cuts for the rich” — actually benefited all income groups by increasing jobs and boosting the overall economy.

The share of the income-tax burden paid by the richest Americans actually rose after the president’s tax cuts kicked in. 

Now that Congress has extended those lower tax rates, we may see a similar across-the-board rise in everyone’s income over the next three years.

Stephen Moore, co-founder of Unleash Prosperity, served as an economic advisor to Donald Trump.