Heading into the midterms—and with 2024 on the horizon—one thing we're hearing from a lot of voters is "the economy was much better under Trump." This is coming not only from the hardcore white conservative base of Trump supporters, but from some Black and Latino voters as well—and Democratic candidates can’t win elections without winning large majorities among those groups. (Unfortunately, recent polling is showing some trouble on that front.) The thing is these recollections don't exactly jibe with the actual economic record.
Audrey Gonzalez is a 20-year-old who hails from Glendale, Arizona. Her parents emigrated here from Mexico and El Salvador. Gonzalez cast her first presidential ballot two years ago for Joe Biden, helping him become the first Democratic presidential nominee to carry Arizona since Bill Clinton in 1996, and only the second one since 1948. She voted for Biden because she considered The Man Who Lost An Election And Tried To Steal It to be a despicable racist.
Obviously, this is not the profile of a committed Trump supporter. However, Gonzalez told The New York Times she’s likely to vote Republican in the midterms. Why? “When we see a better economy in the hands of a Republican, that’s why we tend to lean towards voting for somebody in the Republican Party.” It wasn’t her only issue, but the comment is telling.
Emerson College researchers conducted a survey and interviewed people in focus groups consisting of Hispanic voters in Florida. A good number of the respondents cited the performance of the economy under Trump as a reason they supported him. Overall, according to Spencer Kimball, executive director of the Emerson College Polling Research Team, the results indicated that “Hispanics are willing to push away some of those social issues with Trump and the things they don’t like, all based on the economy." Additionally, there’s “Latino Voters in Limbo—A Midterm Update,” issued last month by Equis Research, which found: “what keeps many Latinos on the fence is again concerns about the economy and fears that Democrats don’t consistently prioritize the economy, handle it as decisively as business-obsessed Republicans, or value hard work.”
Regarding Black voters who back Trump, Biden supporter and co-founder of the activist group Revolutionaries Demanding Justice Ationza Smith explained to Vox that, based on what she’s seen, they “like how he’s improved employment ... they’re kind of basically looking at things on a business level and not necessarily an ethics level.”
The reality of the Trump economic record is far more mixed despite the absurd, easily debunked lies he told about it being—wait for it—“the greatest economy in the history of the world.” First of all, Fuck a l’Orange inherited a strong economy from the man he was fortunate enough to follow, President Barack Obama. He’s the guy who got our country out of the worst crisis since the Great Depression—which occurred on the watch of Republican George W. Bush.
The signature Trump economic policy was The Rich Man’s Tax Cut. In fact, it was the only major legislative accomplishment of his presidency. What impact did it have on the economy other than sending enough money to the wealthiest among us to stuff up 1 million gold toilets while also adding as much as $2 trillion to the national debt? Not much.
On the unemployment rate, the chart below demonstrates that Trump entering the White House had little effect on the sharply downward trend that began under Obama. When it came to job creation, during President Dumpster Fire’s first three years in office, i.e., prior to the outbreak of COVID-19, the U.S. economy added 6.4 million jobs. Not bad. However, during the final three years under President Obama, we added 7 million. Suck on that, Trump.
The best you can say is that Trump didn’t get in the way of the positive developments that were already underway. Dean Baker, senior economist and co-founder of the Center for Economic Policy and Research, offered that on jobs: “While Trump can take some credit, I see it like the relief pitcher who comes in during the 9th inning with a seven-run lead, then boasts about winning the game,” and added: “this is much more an Obama story than a Trump story.”
Then, when the pandemic struck, unemployment shot up—and had the Labor Department not been prevented from doing its normal surveys of workers because of COVID-19, the measured rate would likely have approached 20% in April of 2020. (Some workers who were supposed to be categorized as “temporarily unemployed” due to the shutdown were incorrectly identified as “absent” from their jobs for “other reasons”—which normally means they were on jury duty, out taking care of a family member, etc.) Is this the great economy Trump supporters are longing for?
How about overall economic growth as determined by change to the (admittedly flawed but widely accepted measure known as) Gross Domestic Product (GDP)? The rate of growth under Trump essentially matched the rate of Obama’s final six years, i.e., once the post-2008 recovery was underway. Additionally, as the fact-checker Politifact pointed out: “If you adjust GDP to take account of population, the picture remains weak for the economy under Trump.” Also, for any Trump supporters who forgot, the American economy completely crashed when the pandemic hit, with the second quarter seeing the largest drop in GDP in our country’s history at -33%.
This analysis continued:
Another factor undermining the claim about Trump’s economy is that the Federal Reserve was feeding the economy with historically low interest rates — rates on par with what the Fed usually enacts during poor economic times to revive the economy. In fact, the Fed went so far as to interrupt its plan to "normalize" interest rates by stopping interest-rate increases in early 2019, and it began cutting rates in August 2019, well before the pandemic. (The Trump administration made it clear that it wanted to keep rates low.)
In sum, Heather Long of The Washington Post stated: “Even before the pandemic hit, the picture was mixed. Manufacturing, business investment and growth were slowing noticeably heading into 2020.”
So Trump did meh at best on the economy in his first couple of years—nowhere near as great as the twice-impeached former guy claimed, and the good things that happened had little to do with any policy he actually implemented. But then, as we should remember, it tanked because of COVID, as did economies all over the world. Either way, economic trends since March 2020 have been driven largely by the pandemic.
What’s vital to keep in mind is that the exact same thing is true about the economy under President Joe Biden. In March and April of 2020, while the Tangerine Palpatine still occupied the White House, COVID threw 22 million people out of work—we’ll come back to that figure a bit later. Those losses combined with the pandemic-related shutdowns wreaked havoc on our economy.
First it led to the aforementioned sharp contraction in economic activity in the second quarter of 2020, followed by an equally sharp rebound when pent-up demand was unleashed. COVID also directly fueled the most severe supply chain problems the developed world has seen in some time. And then earlier this year, Russia’s fascist dictator unleashed the bloodiest war Europe has witnessed since the days of Adolf Hitler, which also sent gas and food prices even higher (although thankfully gas prices have dropped significantly since peaking in early June above $5 per gallon, despite the recent small uptick, which in fact has reversed at least for the three days prior to this writing). On grain in particular, Putin is trying to “blackmail the world.”
Russian President Vladimir Putin is seen on a screen set at Red Square as he addresses a rally and a concert marking the annexation of four regions of Ukraine Russian troops occupy in central Moscow on Sept. 30, 2022.
These factors have fueled the worst inflation of the past four decades in the U.S.—inflation that is also happening all over the globe. In Europe, the region where the economy most resembles our own, inflation is both higher and rising at a noticeably faster pace in the Eurozone than it is here, and has also been noticeably worse in the U.K. than our country. Yet inflation is somehow Biden’s fault? In fact, the U.S. economy under Biden has by some measures outperformed that of the rest of the developed world.
Furthermore, as I’ve argued previously, even if it exacerbated inflation to some small degree, the president was right to prioritize economic recovery coming out of COVID in early 2021. The pandemic delivered a shock of epic proportions to the economy. Would we rather have had slightly lower inflation rates than we now do, but at the cost of millions of Americans struggling to pay their bills without the COVID relief Biden and Democrats (without any Republican votes) provided?
Biden has taken a number of steps to fight inflation, including releasing oil from our country’s Strategic Petroleum Reserve (SPR). As for the impact, “The S.P.R. drawdown was probably the single most important factor in lowering crude oil prices and thus gasoline prices over the last three months.” That’s not an administration official talking, it’s Sarah A. Emerson, who serves as a director of a company that, well, drills for oil and gas. Additionally, the White House has enacted measures to ease supply chain problems, strengthen our infrastructure, “[crack] down on the exorbitant fees that foreign ocean freight companies charge to move products,” and more.
The July inflation numbers, with prices flat on a month-to-month basis for the first time since we came out of the 2020 COVID recession, show real progress, even if the August and September month-to-month inflation numbers weren’t exactly what we were hoping to see. On the other hand, the year-over-year inflation rate did continue to slow in August according to multiple measures, and again in September, providing some hope that we are at an inflection point. It’s clear that the president’s inflation-fighting policies are having an impact. Furthermore, the Inflation Reduction Act—passed through Congress without a single Republican vote—according to economists will also bring down prices while making major progress on climate change.
One other factor stoking inflation is, to put it bluntly, corporate greed. Although greed didn’t create this round of inflation, it is making it worse.
On antitrust enforcement, recent polling shows Democrats absolutely should be hammering away on this issue. According to a GBAO survey, 74% of respondents said they’d be more inclined to back a candidate who called for making price gouging illegal as part of an effort to “crack down on companies using inflation and the pandemic to raise prices.” A GBAO memo also emphasized: “There is hardly any difference across party lines in engagement on these policies, suggesting an opportunity for either party to define itself as a champion on corporate accountability.” Democrats had better make sure they are the ones who seize that opportunity.
The proof when it comes to corporate greed and inflation is in the numbers. In 2021, consumers felt harsh pain thanks to rising prices and reduced purchasing power. Corporations? Not so much:
A New York Times analysis of over 2,000 publicly traded companies outside the financial sector found that most of them increased sales faster than expenses, a remarkable feat when the cost of wages, raw materials and components was rising and supply chains were out of whack.
As a result, profit margins, which measure how much money a business makes on each dollar of sales, rose well above the prepandemic average. On the whole, companies made an estimated $200 billion in additional operating profits last year because of that increase in margins.
Inflation is a problem that must be confronted. The Federal Reserve has hiked interest rates five times by a total of three full percentage points over the past few months to do exactly that. However, raising rates also significantly slows economic growth by making it more expensive for consumers to borrow money they might need in order to maintain spending (in particular in the housing market and for other big-ticket items), and more expensive for businesses to borrow money they might need to expand operations.
How is the American economy doing right now? To a large degree it depends on which statistics one chooses to emphasize. By some measures, such as gross domestic income, our economy grew in the most recent quarter. The fact that we’ve seen job growth in recent months in sectors—including temp jobs, retail, and construction—that are particularly vulnerable to the economic cycle further indicates we are not in recession.
One thing we do know is that the media isn’t helping, with lots of hype about a recession since Biden took office. By comparison, the media accurately covered the Trump economy’s moderate degree of success pre-COVID—his main complaint was that they didn’t talk about the economy enough. Maybe if the asshole-in-chief hadn’t provided them with so much, er, other material ...
As for coverage under the current president, economic researcher Kyla Scanlon highlighted in The New York Times the influence of expectations and what she called “vibes” on the actual state of the economy. She pointed to a study that examined “media narratives on inflation,” which determined that “a shift to a viral narrative of inflation damaging the real economy in 2021 accounts for 42% of the fall in consumer sentiment in the second half of the year.” In other words, almost half of the drop in consumer confidence resulted from media reports hyping economic problems. Please note that in early August of this year consumer confidence improved nicely at a clip that exceeded expectations. Confidence was up in particular among middle- and lower-income respondents, indicating that the drop in inflation had a powerful effect on their outlook. This measure rose again in September thanks to improvements on gas prices, jobs, and wages.
As if the media as a whole weren’t bad enough, there’s the right-wing variety. Fox constantly pushes the story that the economy under Biden is awful, even twisting good news into bad, and, worse, getting the story flat-out wrong in some cases. You wonder why so many voters think things were better under Trump.
On those July job numbers, the Biden economy totally knocked it out of the park with 537,000 jobs created (as per revisions released in early October). August also came in at a more than respectable 315,000 jobs created, with labor force participation rising to 62.4%—the highest we’ve seen thus far in 2022.
Another 263,000 jobs were created in September and the unemployment rate dropped to 3.5%, the lowest rate America has had in half a century, while labor force participation held mostly steady at 62.3%. Even though Republicans have been bitching about how supposedly no one wants to work anymore, 80.2% of Americans of prime working age are gainfully employed right now. That’s more than right before COVID hit, back when Trump was presiding over the world’s greatest whatever.
Oh, and remember those 22 million jobs lost since the start of COVID? Well, as of the July report we’ve recovered them all, and with the subsequent two reports there are now about 600,000 more jobs in the U.S. than there were in early 2020.
Despite all the inflation we’ve experienced, the American job market has maintained incredibly impressive strength. Ten million jobs created in only 20 months during the Biden presidency so far—not too shabby. In fact, by some key measures, job growth is stronger than it’s been for a very long time.
Please note that these jobs being created are not solely lower-wage service jobs that, as important as they are, often do not provide a clear path to middle-class stability. Take a look at manufacturing jobs under President Biden:
Ever since American manufacturing entered a long stretch of automation and outsourcing in the late 1970s, every recession has led to the loss of factory jobs that never returned. But the recovery from the pandemic recession has been different: American manufacturers have now added enough jobs to regain all that they shed — and then some.
To be specific, 67,000 more Americans have jobs in manufacturing as of August 2022 than they did in February 2020, i.e., during the supposedly great pre-COVID Trump economy. Just another example of Biden doing more for the middle class than his disgraced predecessor.
Overall, in fact, most of us are doing better economically since the Biden-Harris team was inaugurated. Robert J. Shapiro reviewed the numbers in depth and found the following:
For all of the “pain at the pump” stories … wages and salaries have kept pace with inflation since Biden took office—and by this measure, most Americans are much better off than before the pandemic hit in 2020, and before he took office in 2021…. Even with 9.5 million more people working, the average working person earned as much in June [2022], after inflation, as when Biden took office. ...
Americans are also significantly wealthier than before Biden took office. The pandemic and the jobs boom were primarily responsible…. And it’s not the typical case of the rich getting richer. The fastest growth in net assets occurred among low- and moderate-income households. From the first quarter of 2021 to the first quarter of 2022, the inflation-adjusted wealth of households in the lowest income quintile jumped 15.2 percent and just 0.8 percent for those in the top income quintile (again, excluding the top 1 percent).
Under Biden, Americans are better off in other ways, too. The Center on Poverty & Social Policy at Columbia University reports that the poverty rate, which reached 16.1 percent in December 2020, fell sharply under Biden to 14.1 percent by May 2022. It’s the same story on health care coverage: The Department of Health and Human Services reported that from late 2020 to early 2022, the percentage of uninsured Americans fell from 14.5 percent to 11.8 percent among adults (ages 18 to 64) and from 6.4 percent to 3.7 percent among children, both record lows.
Nobel Prize-winning economist Paul Krugman also reviewed the data and summarized our current situation as follows: “Yes, the Biden boom has been good for workers. More Americans—a lot more Americans—got jobs, and while those who were already employed suffered a decline in real wages, that decline reflected events in global food and energy markets, not U.S. policy. Beyond that, a strong labor market seems to have helped reduce inequality.”
This information is more than just numbers. It reflects people’s lives. But it also matters because information about the economy—or, more accurately, what people believe to be true about the economy—will directly affect the upcoming midterm elections.
If you’re communicating on social media, knocking on doors, or even just talking to people who think the economy was so much more wonderful under the previous prick of a president, please share some of what you’ve learned here, and don’t leave out the part about the economy crashing in 2020. When they reply “oh, well that was COVID,” then you’ve got your opening to explain how COVID—along with greed on the part of Trump’s corporate allies—is what drove inflation so high. That might turn on the lightbulb for anyone willing to listen.
Ian Reifowitz is the author of The Tribalization of Politics: How Rush Limbaugh's Race-Baiting Rhetoric on the Obama Presidency Paved the Way for Trump (Foreword by Markos Moulitsas)
