President Joe Biden stumbled Thursday into the reason falling inflation hasn’t translated into higher economic approval ratings.
To paraphrase New York activist Jimmy McMillan, prices are too damn high.
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The recognition came in a social media post from the president as he celebrated another drop in inflation according to a key metric watched by the Federal Reserve.
“Let me be clear to any corporation that hasn’t brought their prices back down even as inflation has come down: It’s time to stop the price gouging,” Biden wrote. “Give American consumers a break.”
X, the platform formerly known as Twitter, appended community notes to Biden’s post that mostly pointed out that a lower rate of inflation doesn’t mean falling prices for consumers.
Biden is also fingering the wrong culprit for inflation, in keeping with his erstwhile rival Sen. Elizabeth Warren’s (D-MA) fixation with Big Sandwich amid this fiscal and monetary policy phenomenon.
Nevertheless, the Biden social media team’s post shows a basic awareness of the problem: the cost of living remains high compared to just a few years ago, well within the lifetimes of most voters.
That inflation is no longer running at a 41-year high and appears to be returning to a more normal rate does not change this basic dynamic.
Worse for Biden is that most of the things that are good about the economy now, such as robust GDP growth and low unemployment, were good for most of former President Donald Trump’s term before the pandemic.
Inflation is the new innovation that occurred under Biden, even if Trump-era federal spending had an inflationary effect too. But most of that spending took place when the economy was locked down to mitigate spread of the virus. Things were reopening as Biden and congressional Democrats poured gasoline on the inflationary fire and reaped the economic consequences.
Perhaps perceptions will improve as we get closer to next year’s presidential election. It’s worth noting, however, that the recession that helped Bill Clinton defeat incumbent President George H.W. Bush in 1992 had been over for more than a year by the time the election rolled around.
Moreover, the end of the recession came with a reduction in unemployment and people returning to work. The end of white-hot inflation does not begin to return things to their pre-inflation status quo.
If Biden is going to neutralize inflation as a 2024 campaign issue, he is going to need to do more than tell voters to believe the aggregate economic data rather than their own eyes at the cash register. He is going to have to explain why prices remain high even as he keeps touting progressively lower rates of inflation.
That explanation need not be as technical, precise or accurate as the rosy economic statistics he is citing. Biden can try to blame companies for price gouging. Or congressional Republicans for attempting to repeal a law called the Inflation Reduction Act. Russian President Vladimir Putin’s price hike has considerable alliterative merit.
The 16.6% increase in prices since Biden took office is likely baked into the economic cake barring a recession, which would not be any better for securing a second term.
Taking credit for improvements in the inflation rate has so far done little to improve Biden’s standing with the voters, especially on the economy. His approval rating on this issue is just 38.4%, according to the RealClearPolitics polling average.
Some Democrats worry that the “Bidenomics” fixation might make the party look insensitive to voters’ economic concerns.
Perhaps Biden is better off shifting the blame for high prices to his political opponents or unpopular entities instead of taking credit for fixing something most voters still believe is broken.
In fact, Biden is old enough to remember when Clinton was elected over 30 years ago by running against “the worst economy since the Great Depression.” Biden was serving his fourth term in the Senate at the time.
The recession that was the basis for Clinton’s claim about the worst economy had technically ended before he even declared his candidacy for president.
Invoking the National Bureau of Economic Research to this effect did not work out very well for the Republicans that year.
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The early polls are warning Biden that he may face a similar problem in 2024.
Biden’s message may need to be adjusted before the electorate’s economic attitudes.