Bidenomics

Welcome to Thunderdome. One of the Biden White House’s biggest problems at the moment is that while they can point to all manner of aspects of the economy that are doing just fine — above all, the stock market — the lived experience of many key segments of the electorate is totally at odds with this analysis. Hammered by higher food, energy, healthcare and education costs, American households feel constrained by rates that keep them trapped in homes they no longer want to live in, with cars they no longer want to drive. Are people in gas lines and starving? No, of course not. But a line in a recent Wall Street Journal piece encapsulates the situation: “We used to take three vacations a year. Now we take one.

Former South Carolina governor Nikki Haley finally notched her first win in the GOP presidential primary, winning the Washington, DC contest by about thirty points, or 598 votes. Haley picked up nineteen delegates in the contest and now trails Donald Trump by 201 delegates.  The nation’s capital is arguably the worst place Haley could have achieved her first victory. The Trump campaign immediately used it as proof that she is in bed with the political establishment and fundamentally a candidate that can only win with the support of the consultant and donor class.

President Joe Biden presided over an event at the White House on Monday in which he announced the creation of a Council on Supply Chain Resilience and promised actions to “strengthen supply chains, lower costs for families and help Americans get the goods they need.” This news might bring a sigh of relief to many — finally, the Biden administration is taking inflation seriously! But the White House first led with a “Bidenomics” victory lap that felt more like a slap in the face than a swelling pocketbook. Transportation secretary Pete Buttigieg gave opening remarks in which he chastised the media for “saying that Christmas was going to be canceled” due to supply chain disruptions in the winter of 2021.

It feels a bit like Groundhog Day in Washington at the moment. Returning after a week’s vacation, I plugged back in this morning to discover that Donald Trump is bracing for another indictment, this time for his post-election antics in Georgia; that none of his Republican rivals show any sign of making a dent in his primary lead; that Hunter Biden’s misdeeds continue to dog the president; and that Team Biden is gearing up for yet another week trying to win America over on “Bidenomics.”The excuse for Biden’s latest bit of economic salesmanship is the one-year anniversary of the Inflation Reduction Act. This means we will be treated to tired catchphrases that refuse to catch on, such as “grow the economy from the middle out and the bottom up, not the top down.

Things are looking up. Today began with some very good economic news in Washington: Labor Department data shows inflation falling to a two-year low. The consumer price index rose 3 percent in the twelve months to June. That is a steep fall from the 9.1 percent price rise in the twelve months to June 2022, and perhaps the clearest sign yet that the US is on course to tame inflation while avoiding a recession — the soft landing that Joe Biden, Jay Powell and every other policymaker in Washington has been praying for.   Core consumer prices increased by 0.2 percent in June, the smallest single-month increase since August 2021 and an indicator that the pressure on prices is easing.

The president is hitting the road this week to kickstart a big push to sell his economic track record. The nation, barely recovered from the excitement of the first “Investing in America” tour earlier this year, will be treated to another few weeks of cabinet members in hardhats talking about green jobs. A memo from White House advisors Anita Dunn and Mike Donilon warns that Biden, cabinet members and other administrators “will continue fanning out across the country to take the case for Bidenomics and the president’s Investing in America agenda directly to the American people.” (Take shelter!) On Wednesday Biden will give what the White House is billing as a “major speech” touting his economic policies.