US Economy Struggles and Voter Trust Declines: Challenges for Bidenomics

US Economy and Voter Trust Show Weaknesses in Bidenomics

November 16, 2023 | International & Society | Source: FOX NEWS

Despite the overall positive macro-level performance of the US economy, there are indications of challenges at the micro-level, affecting the working Americans and eroding voter trust. Inflation figures for October exceeded Wall Street’s expectations, raising concerns about the persistent inflationary pressures. Interest rates have reached historic highs, and the housing market is in turmoil, with credit card debt reaching record levels.

Although the Biden administration has touted the economic strengths and the merits of Bidenomics, it has struggled to gain the empathy and support of voters. Recent polls indicate that only 2% of voters in six battleground states believe the economy is performing exceptionally well. More than half of voters under the age of 30, Hispanics, women, and all income brackets have expressed more confidence in former President Trump’s ability to handle the economy.

Inflation remains elevated, surpassing the Federal Reserve’s target of 2.0%. The Consumer Price Index (CPI), a common measure of inflation, rose by 3.2% in October 2023 compared to September 2022. The Core CPI, excluding volatile variables, was even higher, at 4%. Notably, current inflation levels are nearly 11% higher than the previous year, impacting hardworking Americans who struggle to meet their basic needs.

Real wages are declining, and revised economic estimates indicate lower household disposable income and higher personal consumption. American households have lost $7,000 in purchasing power during President Biden’s tenure. Considering the average annual income of $71,000 for US households, this loss is significant and may explain the anticipated sluggishness in the upcoming holiday season.

A significant portion of the American population faces financial difficulties, with approximately 33% of Americans having less than $100 in their savings accounts. Only 40% of Americans can afford emergency expenses of $1,000. Emergency withdrawals from 401K accounts have increased by 27% this year. Credit card debt has surpassed $1 trillion, with 61% of Americans carrying debt primarily for essential expenses such as groceries, rent, and utilities.

The housing market is facing significant challenges, with sentiment among homebuilders reaching its lowest point in ten months. Mortgage rates have soared to 8.0%. While housing prices have maintained stability due to inventory shortages, cancellation rates for home purchases reached 16.3% in September, totaling 53,000 cancellations. Foreclosures have increased by 34% compared to the previous year, with over 150,000 homes currently in the foreclosure process. Car repossessions have also surged by over 20%.

Despite the potential for President Biden to run for re-election based on the strengths of Bidenomics, many Americans are experiencing hardship and falling behind despite their hard work. Despite positive macroeconomic indicators, working Americans are facing financial difficulties, leading to a lack of confidence in the current administration’s economic policies.

Kim Nels, a supply chain consultant based in Chicago, Illinois, has held top positions as a Chief Purchasing Officer, Chief Supply Chain Officer, and Chief Operating Officer in various companies. Jim served in the Navy as an officer after attending college on an NROTC scholarship. He holds a bachelor’s degree in Economics and French from Northwestern University and a Master’s in Business Administration from the Kellogg School of Management.