Most Americans (56 percent) think the U.S. is in recession. It is not.
Almost half (49 percent) think the stock market is down for the year. It is not.
The same percentage (49 percent) thinks that unemployment is at a 50-year high. Wrong again.
And nearly three-quarters of the country (72 percent) thinks inflation is increasing. You guessed it— still wrong.
These are the surprising results of a recent Harris poll conducted on behalf of The Guardian, and it is not good news for President Biden.
That so many Americans think that things are worse than they are is driving Democrats crazy. They know that the economy is the No.1 issue for most voters, and that Biden is given extremely low marks on his handling of our country’s finances. They are frantic to set the record straight; so far, their messaging has come up short.
Why are people so mixed up about the economy?
First, because so many are struggling to pay their bills, which they probably associate with a recession. Second, because real incomes are stagnant, people’s living standards have deteriorated, which doesn’t lead to rose-colored glasses.
Third, and maybe most important, Joe Biden and his surrogates have lied so frequently to Americans about the state of the economy (and the country) that people are no longer paying much attention to spin from the White House. Being told repeatedly that everything is great, when you can’t make ends meet, is deeply unsettling. And it’s also insulting — the corollary implication is that you just don’t understand your own situation.
Anyone paying attention to Joe Biden when he tells the public over and over again that inflation was 9 percent when he took office and the economy was in freefall knows he’s not telling the truth. Even the uber-friendly Washington Post scolded the president for this canard, awarding him four Pinocchios for having repeated the bogus claim on several separate occasions.
For the record — again — when Joe entered the Oval Office in the first quarter of 2021, the economy was growing at over 6 percent and inflation was 1.4 percent. After pushing an unprecedented amount of stimulus funding (including the $1.9 trillion American Rescue Act) out into a constrained economy, inflation zoomed to 9.1 percent, the highest in 43 years.
This was not an Act of God; this was an Act of Biden.
Those are the facts, repeated so often by commentators on the right that Biden cannot rewrite history. Biden not only lies about the level of inflation, he lies about the reasons for it. He and his progressive pals like Elizabeth Warren are pushing the narrative that food inflation, with prices up 21 percent since Biden took office, is really the fault of greedy big grocery and food companies. They accuse them of gouging consumers, a charge that is simply false.
In February, Biden said there are “still too many corporations in America ripping people off. Price gouging, junk fees, greedflation, shrinkflation.”
Just in the past few days, Senator Warren opened a hearing of the Senate Banking, Housing, and Urban Affairs Subcommittee by calling out food companies for price gouging and using monopoly power to raise prices. She knows better. Democrats hope that voters will blame corporate greed for high prices, not their own out-of-control spending.
As I wrote in this space in March, an analysis of gross margins (the difference between sales and cost of goods) showed that big companies like Pepsi and Heinz had, like all American consumers and businesses, been clobbered by inflation in 2021 and 2022. The big grocery providers raised prices to combat higher costs, but were still behind when I wrote the piece. In other words, if those companies, as well as meat producers and grocers, had raised prices in line with costs to maintain their profitability, food inflation would have been even worse.
Recent data from the Federal Reserve also debunks Biden’s claims. CNN reports: “Economists at the SF Fed found that corporate price gouging was not a primary catalyst for the inflation surge of 2021 to 2022.” They quote those researchers: “Aggregate markups – the more relevant measure for overall inflation – have stayed essentially flat since the start of the recovery.”
It isn’t just inflation that Joe Biden lies about. He also claims to have “created” 15 million new jobs. As the Washington Post points out, the number of employed people has grown by about 6 million between February 2020 — before the economy shut down because of COVID — and last month. Those might be considered “new” jobs. Under Donald Trump’s administration, 6.5 million more workers went on the payroll during his first three years. Also, the labor participation rate is still below where it was when Trump was president.
Bloomberg reacted recently to swing-state polls in which voters declared they had been better off under Trump than they are today under Biden. Looking at several variables, the business platform concluded that, by most measures, voters were right.
- Real disposable income: up 7.7 percent cumulatively under Trump, ahead 2 percent under Biden;
- Inflation: up 5.6 percent under Trump, up 19.5 percent higher under Biden;
- Mortgage rates: 3.4 percent under Trump as of May, 7.1 percent under Biden.
- Unemployment: in January 2020, before COVID hit, joblessness was 3.6 percent under Trump compared to 3.7 percent under Biden. The pandemic destroyed the economy, and unemployment rose, but that once-in-a-lifetime event cannot be viewed as Trump’s fault, though Bloomberg gives Biden the edge here.
- Stock prices: in nominal terms Biden is winning this race, but as others have pointed out, adjusted for inflation Trump is ahead.
Joe Biden has squandered the trust of the American people by dishing out three years of falsehoods. Voters are looking at facts today, not the White House spin machine. That doesn’t bode well for his reelection hopes.
Liz Peek is a former partner of major bracket Wall Street firm Wertheim & Company.
