Biden struggles to improve Americans’ views of the economy
The flurry of activity in recent days reflects an urgent, stepped-up campaign to convince Americans that Biden is steering the country back to prosperity, an effort that’s likely to last until the November election. But so far, Biden has had strikingly little luck persuading voters, rocked by high inflation, that the economy is headed in the right direction, despite numerous signs of strength.
The White House is well aware of the problem. “That’s a really complicated question,” said Cecilia Rouse, chair of Biden’s Council of Economic Advisers, when asked Friday why Biden isn’t getting credit for the good economic news.
Rouse said the White House is seeing data showing that people feel their own finances are “fairly healthy,” but “they see the kind of uncertainty in the economy that is there.” She added, “We are a pandemic-scarred society. That’s not just the economy. There’s uncertainty as we navigate our way out of this pandemic.”
The administration’s sensitivity to price increases is spilling into its policy toward the Russian invasion of Ukraine. Biden officials on Friday cited the danger of higher prices at the gas pump as they weighed whether to ban U.S. purchases of Russian oil, even as lawmakers on both sides of the aisle pressed Biden to do more to punish Moscow.
Economists generally back up the White House claim that the current recovery is unusually strong. “He’s got an overwhelmingly positive story to tell, and somehow he’s getting beaten up like we’re in the Great Depression,” said Dean Baker, senior economist at the Center for Economic and Policy Research, which focuses on the plight of low- and middle-income Americans.
The Labor Department reported Friday that the U.S. economy created a blockbuster 678,000 jobs in February, while unemployment fell to a 3.8 percent, the lowest since the pandemic began. That capped off 10 straight months of strong growth, with the economy picking up 7 million jobs and apparently headed for pre-pandemic strength.
But in a Washington Post-ABC News poll from last month, only 37 percent of registered voters — and 28 percent of independents — approve of Biden’s handling of the economy.
White House aides say privately that Biden needs to ratchet up the frequency with which he talks about positive economic news, and they point to Democratic polling that suggests American families feel good about their individual situations while pessimistic about the country at large.
Biden’s allies anticipate a steady drumbeat of announcements and trips through the spring and summer designed to blunt what Democrats increasingly worry could be a damaging political dynamic in the midterms. The White House is already planning at least one event on the economy next week that has not yet been announced, according to a White House aide who spoke on the condition of anonymity because they were not authorized to discuss the president’s schedule. “We think the repetition is really important,” the aide said.
But any message of good economic news is now competing with the explosive crisis in Ukraine for the public’s attention. Vice President Harris is traveling to Poland and Romania next week, for example, to showcase America’s commitment to its NATO allies.
Biden’s allies contend that the economy is not the only area where he has accomplished far more than he often gets credit for.
Beyond enormous job growth, they say, the president in just the past few days has assembled a global alliance to counter Russia; introduced Supreme Court nominee Ketanji Brown Jackson to favorable reviews; delivered a generally well-received State of the Union address; and touted the end of mask mandates in many parts of the country, signaling a closer return to pre-pandemic normal.
Republicans disagree, and they see the economy, especially inflation, as a winning issue in November. The morning after the State of the Union address, Senate Minority Leader Mitch McConnell (R-Ky.) said on the Senate floor that Biden had “tried to skate by the serious kitchen-table concerns that are keeping American families up at night” and that his spending plans “would make inflation even worse.”
But the White House says it can benefit from contrasting Biden’s approach to the one offered by Sen. Rick Scott (R-Fla.), the head of the National Republican Senate Committee, who proposed late last month that most Americans who do not pay income tax be required to do so.
In a Wall Street Journal editorial Friday that raised eyebrows in the White House, Scott doubled down on his idea, which would affect those who do not make enough to pay taxes. “Even if it is just a few bucks, everyone needs to know what it is like to pay some taxes,” Scott wrote. Other top Republicans, including McConnell, have disavowed this idea, spotting the political peril.
The White House sees an opportunity to reprise one of the president’s favorite sayings — “Don’t compare me to the almighty. Compare me to the alternative.” The administration is eager to compare Scott’s proposal with Biden’s pledge not to raise taxes on Americans making less than $400,000 a year.
The White House also plans to highlight Senate Republicans’ blockade of Biden’s appointments to the Federal Reserve. The senators are opposed to nominee Sarah Bloom Raskin, who they say is too liberal on issues like climate change, but Democrats say the move is hurting an agency that deals directly with inflation.
Biden did receive some good news this week. A poll from NPR, PBS NewsHour and Marist released Friday suggests that Americans may be starting to shift their views, with 47 of respondents saying they approve of Biden’s handling of the economy — a bump of nine percentage points over a similar survey conducted before the State of the Union address. In general, the poll signaled a broad improvement in Biden’s standing, but it is too early to know if that shift will be confirmed by other surveys.
Part of the problem Biden faces is psychological, said Felicia Wong, president of the left-leaning Roosevelt Institute.
Americans tend to blame inflation on outside forces over which they have no control, including the government, Wong said. But when it comes to good economic news — like lower unemployment or higher wages — people often see that as a reflection of their own hard work and don’t credit the government, she said.
Still, some experts say Biden could do more to fight inflation. Several economists have recommended, for example, that Biden try ideas such as a gas tax holiday, which has been discussed on Capitol Hill, or another round of stimulus checks for people at the lower income ranges, perhaps funded by leaning on companies that have profited handsomely during the pandemic.
White House aides, however, downplayed the notions that any new shifts in policy are coming.
Biden’s latest event aimed at highlighting strong economic news came Friday, when he declared, “Americans are back to work.” He added, “Folks, America is coming back. It really is.”
He noted that the unemployment drop from 6.4 percent when he took office to 3.8 percent in February was “the fastest decline in the unemployment rate in recorded history,” and that the creation of 7.4 million jobs during his presidency was also a record
But the president tempered his optimism a bit with a nod to Americans hit by inflation. “Yes, family budgets are still tight,” he said. “But a lot of Americans are getting paychecks this year more than they got last year.” He added, “Many families are still struggling, though, to make ends meet because of inflation. I understand. Our top priority must be getting prices under control.”
Biden’s event focused on his decision to change the rule that determines whether a product can be considered “made in America” so that it gets a preference when the federal government is buying a product.
Under the 1930s-era Buy American Act, goods can be purchased by the federal government with tax dollars if they are “substantially all” made in America. In practical terms, that has meant that just 55 percent of their parts need to be made domestically to qualify. On Friday, Biden announced he’s upping that standard to 75 percent by the end of the decade.
“To me, 55 percent isn’t ‘substantially all.’ It’s slightly over half,” Biden said. “ ‘Substantially all’ is going to start meaning substantially all.”
Biden called the update the biggest change to the rule in 70 years. He had touted it in his State of the Union address Tuesday, saying the federal government spends about $600 billion on goods.
“There’s been a law on the books for almost a century to make sure taxpayers’ dollars support American jobs and businesses,” Biden said Tuesday evening. “Every administration — Democrat and Republican — says they’ll do it, but we’re actually doing it.”
White House officials said Thursday evening that they do not know what percentage of goods purchased by the federal government will meet the new threshold. One aide said the administration is considering a subsequent rule that would allow the government to identify which parts in an item are made in the United States.
The change would be phased in over coming years. Goods will need to have 60 percent of the value of their component parts made domestically next year, ramping up to the full 75 percent by 2029, according to a fact sheet issued by the White House.
Biden was joined at Friday’s event by Barbara Humpton, CEO of the technology firm Siemens USA. The federal government is Siemens’s largest customer, Biden said, and the company announced that the rule change would prompt them to invest about $50 million in making components for electric vehicles and data centers in the United States. The expansion will be in California and Texas.
Similarly, Schneider Electric in November announced the construction of a new 160,000-square-foot manufacturing plant in El Paso as part of a $100 million regional investment. In a statement, Schneider Electric North America CEO Annette Clayton said the rule change “affirms” the company’s decision to make the investment, adding that it “delivers a lot of industry optimism to take further steps.”
