Amid conflicting signals regarding the economy, the Biden administration and Republicans are trying to paint a picture of the country’s overall economic health for the electorate.
With President Joe Biden and many congressional leaders out of Washington and on vacation, attention is shifting toward selling their vision to voters, who will decide control of the House and Senate in November.
BOLD BILL OR TERRIBLE TAX HIKE? BIDEN AND GOP FIGHT TO DEFINE NEW SPENDING LAW
“Americans all across the country are back at work in record numbers,” Biden said in a statement released Friday. “[Twenty-two] states — a record high — have unemployment rates at or below 3 percent, and 14 states now have their lowest unemployment rate on record. This is the latest sign that my Administration’s economic plan is working.”
The president then touted the 528,000 jobs created in July and unemployment hovering near 50-year lows before saying the 2021 infrastructure law, the CHIPS and Science Act, and the Inflation Reduction Act would be future economic boosters.
But the underlying economic signals are wobbly at best. Gross domestic product has contracted for two consecutive quarters, which is the commonly understood definition of a recession. But the National Bureau of Economic Research hasn’t declared one yet, and the Biden administration insists such an occurrence doesn’t fit the “technical definition.”
The housing market is also slackening, largely as a result of federal interest rate hikes. A housing market index released Monday by the National Association of Homebuilders and Wells Fargo found that builder confidence sank 6%, falling into negative territory for the first time since early 2020, which was also the last recession.
Those higher interest rates result from very high inflation, another significant source of worry about the economy. While Biden has promised not to interfere with the Federal Reserve, more liberal voices, like that of Sen. Elizabeth Warren (D-MA), are calling on the agency to stop hiking interest rates in order to avoid a recession.
At the same time, the economy added 528,000 jobs in July, while the unemployment rate also unexpectedly fell to 3.5%, matching the ultralow level it was at prior to the pandemic.
It’s a lot to explain, especially in the space of a 30-second ad or a billboard.
A group called the Democratic Messaging Project is rolling out billboards in several swing states and focusing instead on specific deliverables within the Inflation Reduction Act, such as prescription drug cost savings and extended Obamacare subsidies.
“We’re basically saying, ‘Democrats have brought down drug, healthcare and energy prices. Republicans have allowed Big Oil to gouge you,'” said JoAnn Loulan, the group’s co-founder. “‘Democrats have voted to lower your drug prices. Republicans have voted against that.’ We say very simple messages even with the Inflation Reduction Act, which is very complex.”
Even the bill’s name is “genius,” Loulan adds, a sort of built-in advertisement.
The GOP is pointing at other factors, such as gas prices that are up nearly $1.50 a gallon on average since Biden took office and inflation levels not seen since the early 1980s, and are fully embracing the R-word.
“Republicans stand for lowering prices, relief at the gas pump, digging Americans out of the Biden recession, and making life better for American families,” said Republican National Committee spokesman Will O’Grady. “Americans don’t trust the Democrats who rubber-stamped Biden’s disastrous economic agenda.”
Conservatives have rallied around the $80 billion and tens of thousands of new employees for the IRS included in the bill to message that the bill helps big government while hurting middle-class families.
They’ve also countered several dubious claims about the economy made by Biden and White House officials in recent weeks. That pattern continued this week as Biden’s press team promoted a story claiming that voters should interpret falling gas prices as a $100 monthly raise.
But while gas prices are indeed down from their June highs, they’re still much higher than they were when Biden took office.
“The White House ‘claiming victory for making things worse’ approach to touting gas prices is as pathetic as it is out of touch,” O’Grady said. “If Biden and Democrats actually cared, they would end their war on American energy producers and be honest with the American people.”
Versions of that statement are likely to circulate in GOP messaging campaigns this fall.
CLICK HERE TO READ MORE FROM THE WASHINGTON EXAMINER
What neither political party will be able to control is what actually happens with the economy itself. Biden can now promote legislation and hope for a sweet spot of lower inflation and no recession, but if the stock market nosedives and unemployment rises, it may make little difference.
Stocks crashed in September 2008 as part of what later became known as the Great Recession. That development helped cement a historic cycle for Democrats, as the party won the presidency, picked up eight Senate seats, and gained 21 in the House. This time around, the party will hope for a much more stable economy to help match its messaging and avoid a midterm election wipeout.
