Voter attitudes about the economy have improved in recent polls, but that hasn't translated into more support for Joe Biden. Perhaps we can see the reason for that in a poll that shows that voters felt a lot better about the economy while Trump was president than they feel about the economy under Biden.
A recent CBS News poll found that 65% of voters recall the economy being better under former President Donald Trump compared with 38% seeing the current economy under Joe Biden the same way.
That same CBS poll found that six in 10 voters see the economy as "bad" despite what economists, the mainstream media, Democrats, the White House, and that loud-mouthed guy at the bar say about how great things are.
Is it a difference between pre and post-pandemic economies?
"These are two very different periods from an economic standpoint," noted Gregory Daco, chief economist at EY. "The 2017-2019 period was the end of the longest business cycle on record — the economy was doing well, [and] the labor market was quite strong. We had the lowest unemployment rate in 50 years, we had an economy growing at a sub-2% rate but still moving forward."
In other words, the economy prior to the pandemic was chugging along, providing a strong if not stellar environment. But the post-pandemic economy introduced a number of upheavals, including a labor shortage and the highest inflation in 40 years — which has since receded but remains above its pre-pandemic levels.
"There is that sentiment that you are still coming out of a shock," he added.
To be sure, presidents often get credit when the economy is performing well and are blamed when it tanks, even though there's a limit to how much influence the commander in chief has over such a complex system. Indeed, the economy's performance is often tied to boom-and-bust cycles that don't have much to do with who's occupying the White House
Presidents wouldn't get credit or blame for the performance of a $23 trillion economy if the political opposition wouldn't try to portray the president as being in control. Historian Theodore H. White describes the president's policies as they affect the economy as something like a piano tuner using boxing gloves. He can bang the higher keys to stimulate growth in the economy or bang the lower keys to stimulate savings. Other than that, there's not much a president can realistically do to affect the economy.
Biden rightly gets the blame for making inflation much worse than it should have been. And that inflation is baked into the economy. Prices will never come down to where they were in 2020.
As people realize that, they become angry and resentful. Joe Biden is the perfect target to take out voter resentment.
"We're coming out of an environment where inflation has become a key topic, a key issue, a key point of conversation, whereas it wasn't for most of the three decades that preceded the pandemic," Daco noted. "It's gone from a non-issue to an essential issue, and that for me is the key reason people are feeling more downbeat than economic conditions would dictate."
Consumers value predictability when it comes to prices, something that Federal Reserve Chairman Jerome Powell highlighted when he spoke with CBS News last month.
"I can't overstate how important it is to restore price stability, by which I mean inflation is low and predictable and people don't have to think about it in their daily lives," Powell said. "That's where we were for 20 years. We want to get back to that."
This is not a question of comparing the two economies' numbers. That's a futile effort that would make voter's eyes glaze over. It's about the perception of the two economies side-by-side in people's minds.
It would appear that Trump wins the perception game hands down.
