The economic narratives of the Biden and Trump administrations are rife with comparisons and contrasts, particularly when it comes to real wage growth. As the nation inches toward another election with the potential for a rematch, it’s crucial to dissect the claims surrounding the economic performance under both presidents.
The Biden administration has presided over an economic recovery that, according to a study by David Autor, Arindrajit Dube, and Annie McGrew, showcases real wage growth outpacing the rise in the cost of living since the pandemic. This is a significant marker, considering that for decades wage growth has typically been stronger at the top. But, as Dube emphasized, “the real wages of the middle quintile are not only higher today than they were before the pandemic, but slightly higher than we would expect based on 2015-19 trends.”
This analysis contrasts sharply with the sentiment on the ground, where voters continue to view the Trump economy more favorably, with 65% considering it good compared to only 38% for the current economy under Biden. Despite the rosy picture painted by economic data, Americans’ perceptions are colored by their day-to-day experiences, particularly with inflation and the cost of living.
During Trump’s tenure, the economy experienced low inflation, around 2% annually, which often goes unnoticed by consumers. This stability was upended by the pandemic, as inflation soared to a 40-year high of 9.1% in June 2022 under Biden. Although inflation has since receded, prices remain above pre-pandemic levels, eroding the gains made in wage growth and impacting the public’s economic assessment.
Biden’s economic challenge was to manage recovery from a pandemic slump and address inflation, which his policies arguably did accelerate at one point. However, the U.S. succeeded in curbing inflation faster than other developed nations while maintaining lower unemployment and higher wage growth.
Currently, the U.S. is witnessing the most robust monthly job growth in history under Biden, with wages, particularly for the middle class and the poor, experiencing significant increases. This is a testament to the Biden administration’s focus on “middle-out economics.”
While the Biden administration can boast of legislative successes, including the bipartisan infrastructure law and the CHIPS Act, and interventions to ease supply chain pressures, the narrative battle continues as Americans still feel the pinch of inflation and remember the pre-pandemic economy fondly.
The question remains whether the Biden campaign can effectively communicate these economic gains to the American public, especially those who still feel the economic strain. While the Biden economy has certainly seen real wage growth, perceptions of the economy remain a challenge, and the narrative war between the two economic eras is as heated as ever.
Relevant articles:
– It’s the Biden vs. Trump Economy—and Hell No, It’s Not Even Close | The facts are clear: Biden has overseen a stronger economy than Trump did. That reality should dominate his reelection campaign.
– Voters remember Trump’s economy as being better than Biden’s. Here’s what the data shows., CBS News, Wed, 06 Mar 2024 08:00:00 GMT
– Trump vs. Biden Economy in 6 Charts, Barron’s, Wed, 06 Mar 2024 08:00:00 GMT
– Biden’s vs. Trump’s economy, in 8 charts, Vox.com, Tue, 12 Mar 2024 07:00:00 GMT