Bill Clinton advisor James Carville famously coined the term, “It’s the economy, stupid.” And with a recession dragging down incumbent George H. W. Bush, it was a smart move since it contributed to his ouster.
When it comes to the economy, a new poll shows bad news for Joe Biden and a possible boon for Donald Trump. Even if the facts don’t align with the current reality.
Majorities of people think the U.S. economy is shrinking (55%) and that we’re in the middle of a recession (56%), according to a Harris poll conducted exclusively for the Guardian. Also, nearly of the country (49%) believe the S&P 500 stock market index is down for the year and 49%believe that unemployment is at a 50-year high.
The problems?
The country’s gross domestic product — the economy’s total output of goods and services — has been growing, so the U.S. is not in a recession. (Though the GDP decelerated in the January-March quarter from its brisk 3.4% growth rate in the final three months of 2023.)
As far as the stock market? The Dow Jones Industrial Average just closed above 40,000 for the first time last week. The S&P 500 market index went up 24% in 2023 and is up more than 12% this year.
And on unemployment? It’s at a 50-year low at less than 4%.
The economy, though, is still creating price pressures, a continuing source of concern for the Federal Reserve. A measure of inflation in Friday’s report accelerated to a 3.4% annual rate from January through March, up from 1.8% in the last three months of 2023 and the biggest increase in a year. Excluding volatile food and energy prices, so-called core inflation rose at a 3.7% rate, up from 2% in fourth-quarter 2023.
The state of the U.S. economy has seized Americans’ attention as the election season has intensified. Although inflation has slowed sharply from a peak of 9.1% in 2022, prices remain well above their pre-pandemic levels.
And polls show that despite the healthy job market, a near-record-high stock market and the sharp pullback in inflation, many Americans still hold dim views of Biden’s handling of the economy.
But in the words of Carville, it’s all about the economy. Oh, and perception versus reality matters.
“I don’t think, if people don’t feel like they’re in a good economy, you can’t convince ‘em,” Carville told NewsNation host Chris Cuomo earlier this month. “And I think there’s a bunch of Ivy League economist academic types that go in and saying, ‘sir, this is the best economy we’ve had since 1969, you have to go out and promote it.’ That’s not the world people are living in. And at some point, Chris, you know, baseball, you’ve got to let the ball come to you. You can’t charge the ball. And I agree with the critics that this is not the proper messaging.”
The Associated Press contributed to this report.
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Matt Arco may be reached at marco@njadvancemedia.com. Follow him on Twitter at @MatthewArco.
