Prior to retirement, my education and much of my work was focused on demographics, economics, and economic forecasting. Even now, I continue to follow U.S. economic trends. Consequently, I am perplexed by polls showing that many Americans think our economy is bad, and some prefer the previous Trump economy.
Looking at statistics from reliable sources rather than social media, or misinformation and disinformation espoused by politicians and Russian bots, the picture seen is much different.
The record of the Biden-Harris administration is the most productive since LBJ. We have produced the world’s best post-COVID recovery, achieved record low unemployment, and created more than 15 million new jobs — more than any administration in history — in less than four years. We are witnessing record new small businesses opened, a record high stock market, and record domestic energy production. Record investments in infrastructure and clean energy have spurred economic growth.
Legislation pushed through Congress by Biden-Harris, such as the bipartisan infrastructure Law, the CHIPS and Science Act, and the Inflation Reduction Act, led to these achievements.
Not only is the Biden-Harris economy good, but it has also significantly outpaced the Trump-Pence economy:
Under Trump-Pence, real gross national product (GNP) increased 1.5% annually, compared to Biden-Harris’ 3.4% annually.
Job growth in Trump-Pence’s first three years averaged 1.4%, compared to the Biden-Harris average growth rate of 2.9%. However, if you count Trump-Pence’s last year, 2020, their administration lost 3.1 million jobs at the end of four years.
Trump claims that his tax cuts (mostly for the wealthy) stimulated an investment boom, but business investment grew at a modest 2.6% annually compared to the Biden-Harris growth rate of 5.1%.
According to the U.S. Census Bureau, 304,000 new businesses were formed per month during the Trump-Pence administration, considerably fewer than the 442,000 per month during the Biden-Harris administration.
Complaints about the Biden-Harris economy center on inflation. Inflation averaged 2.1% under Trump-Pence, until the 2020 recession brought deflation. The economy began to grow again in 2021 under Biden-Harris, but demand for goods exceeded the supply, due to shortages caused by the pandemic, the Russian invasion of Ukraine, and cuts in oil production by OPEC. Inflation affecting the world, not just the U.S., resulted. In the U.S., inflation peaked at 9.1% in 2022.
The Biden-Harris response to inflation can be judged relative to the response by other countries, especially those in the Western industrialized world. U.S. inflation fell earlier and more rapidly than in most industrialized countries. Inflation has now held at or near the Federal Reserve target of 2% for six months. The economy may achieve a rare “soft landing,” hitting target rates while avoiding a recession. However, high interest rates are now slowing economic growth, and this will continue until the Fed lowers rates, likely in September.
According to the Wall Street Journal, our economy is “the envy of the world.” We have increased the size of our economy by 5.4% above its pre-pandemic level, while bringing inflation down to an appropriate level. It would be difficult to do much better.
Roy Morey is chair of the Jeff Davis County Democratic Party
Sources:
The U.S. Economic Recovery in International Context — Assistant Secretary for Economic Policy Benjamin Harris and Deputy Assistant Secretary for Macroeconomic Policy Tara Sinclair, U.S. Department of the Treasury
The U.S. Economy Is Pulling Off Something Historic — Bryan Mena, CNN
Data Don’t Lie: Harris Has the Facts to Refute Trump’s Lies About the Economy — Robert J. Shapiro, Washington MonthlyThe President’s Speech, We Choose Freedom, My Interview W/Will Robbins, The Economy Is Strong — Simon Rosenberg, Hopium Chronicles