President Joe Biden’s polling numbers continue to deteriorate. According to a recent ABC News poll, just 36% of voters approve of the president's performance.

The people are angry about inflation. Lower-income households are disturbed that they cannot afford a new vehicle. That is particularly true for electric vehicles, where the price of the battery alone costs about $10,000. Biden, of course, isn't a fan of non-electric cars .

More broadly, the public fears that Biden is driving the economy over the cliff. Yes, the employment market remains resilient. But employment growth has clearly slowed. Wage inflation remains elevated , too high to be consistent with 2% inflation which remains the Federal Reserve’s inflation target. Indeed, wage inflation is running at over 5%. Productivity growth over the pandemic period is expanding at just over 1%. To achieve the Federal Reserve’s 2% target, wage inflation must fall toward 3%. Wages and prices will converge.

Another complicating factor is that the labor market is at full employment . Wages are unlikely to fall when the labor market is operating at capacity. Unemployment must increase. That will affect consumer confidence, which is already fragile. Consumption is 70% of economic activity. If consumer spending slows, then the economy could roll off the cliff. After all, GDP growth in the first quarter of this year was just 1.1% .

It would not take much to precipitate a recession. To compound the problems facing the economy, the regional banking system is under pressure. The share values of some regional banks have dropped by 50% or more. Households are worried about the safety of their deposits. Runs on banks could occur. Both Signature Valley Bank and First Republic Bank failed because of bank runs. Further interest rate increases could start new bank runs. As interest rates rise, long-duration assets held by banks fall in value.

In addition, some regional banks are overly exposed to the commercial real estate market, where some landlords are walking away from mortgages. More interest rate increases will push those real estate values even lower.

Biden could stem the run on confidence for the U.S. banking system by stating the obvious: all bank deposits are guaranteed by the federal government. But Biden will not do that because such action would be characterized as bailing out the banks and their fat cat owners. Biden risks a national bank run which would cause a 1930s-type Great Depression. Biden pushed inflationary policies, and inflation followed. His policies are driving the economy into recession.

James Rogan is a former U.S. foreign service officer who later worked in finance and law for 30 years. He writes  a daily note  on finance and the economy, politics, sociology, and criminal justice.