Democrats, and the opinion-makers who support them, just can’t seem to figure out why voters are still sour on the Biden economy. Writing for New York Magazine, Jonathan Chait made the case that “Paul Krugman Is Right About the Economy, and the Polls Are Wrong.”
“One of the most uncomfortable arguments to make in America is that the people are wrong,” Chait wrote. “It’s especially uncomfortable when the subject is something you experience in a more comfortable, privileged way than most people. And so when liberal economic elites insist the economy, which opinion polls consistently find the public considers terrible, is actually very good, it makes liberal economic elites come off badly.”
Undeterred by the task in front of him, Chait then quoted Robert Kuttner, who made his own case for why Biden is still receiving poor marks on the economy. “None of the recent improvements have altered the basic situation of most Americans, in which reliable careers are scarce, college requires the burden of debt, health coverage is more expensive and less reliable, and housing is unaffordable,” Kuttner wrote.
To which Chait then responded, “Kuttner’s hypothesis fails to explain why Americans were thrilled by economic conditions as recently as 2019, when the same basic features of the economy remained in place.”
Chait then quoted the Atlantic’s Michael Powell, who wrote, “The modern Democratic Party, and liberalism itself, is to a substantial extent a bastion of college-educated, upper-middle-class professionals, people for whom Biden-era inflation is unpleasant but rarely calamitous. Poor, working-class, and lower-middle-class people experience a different reality.”
“A large number of these Americans worked in person during the dolorous early days of the pandemic, and saw its toll up close. And since 2019, they’ve weathered 20 percent inflation and now rising interest rates — which means they’ve lost more than a fifth of their purchasing power,” Powell continued. “Tell these Americans that the economy is humming, that median wage growth has nudged ahead of the core inflation rate, and that everything’s grand, and you’re likely to see a roll of the eyes.”
To which Chait again responded, “Yet, like Kuttner, he fails to explain why these same voters considered Trump’s economy to be so splendid.”
This is really Chait’s only argument in the piece. What is so different about the Biden economy than the Trump economy that is making voters so unhappy?
Chait is clueless. Has he never heard of interest rates?
The highest that interest rates on the average 30-year mortgage ever got under Trump was 4.94%. When Biden was sworn in, they were down 2.67%. Housing was expensive, but many people felt it was within reach.
Thanks to Biden’s massive spending, inflation has pushed average mortgage interest rates to a height of 7.63%, and they are at 6.88% today. These are not small differences. The average monthly mortgage payment is now double today what it was in 2020. Today, a family needs to earn $106,000 a year to afford the median home. In 2020, it needed just $59,000.
How many people does Chait know who got 80% pay raises in the last four years?
And then there are car payments. In 2020, the average monthly payment for a new car was $554, and for used, it was $391. Thanks to high interest rates, monthly payments are $644 for new cars and $488 for used. Again, these numbers are only partly caused by inflation. They are mostly driven by interest rates, which are not considered when measuring inflation.
The American dream is to own a home and buy a car. These two goals have become completely unaffordable under Biden. And Chait has the audacity to wonder why people feel the economy is bad.
And then there is credit card debt, which, again thanks to higher interest rates, is also at an all-time high.
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People can’t afford a home, they can’t afford a car, and they can’t pay their credit card bills. All thanks to high interest rates caused by Bidenomics.
And Democrats can’t even begin to admit they have a problem.