Americans observe the end of the curve of a presidential campaign that, barring surprises, will culminate in November with the Closest elections in a long timein a climate of extreme polarization in which pollsters rack their brains to find details that tip the balance.
The public agenda is dominated by central issues that express the “two souls” into which North American society has been divided: the right to abortion, the role of religion, the value of immigration, the role of minorities and even the right to vote. Still, the economy remains very decisive, for Democratic and Republican voters alike, and brings them closer over that bitter divide.
After the Covid-19 pandemic, the world’s leading economic power (a GDP of 30 trillion dollars) experienced a strong rebound under the presidency of Democrat Joe Biden and grew again, with records in terms of job creation and the deployment of public policies that opted for a change in its productive matrix. The objective was to ensure double leadership, technological and environmental. This strategy was called the “Bidenomics”.
Despite a scenario where living conditions experienced a sustained improvement, there is a relevant segment of voters who are dissatisfied with the economic situation. That perception poses a great challenge to pollsters, and especially to Biden’s advisers.
In the last two years, the economy grew at an average rate of 2 percent and now it does so at a rate of 3.4 percent (although in the last quarter it fell to 1.6 percent). For its part, the unemployment level is at 3.8 percent; a brand that is below the historical average. And, in financial matters, a relevant indicator such as the S&P 500 index accumulated a gain of 10 percent in the first quarter, the maximum in two years.
Inflation
Despite the good macroeconomic results, American consumers’ mood worsened in the last two years. When the evolution of the indicator is observed since 1980, a drop is recorded even to levels below those recorded during the Great Recession of 2008-1010.
The data is relevant because previous North American presidents were re-elected when the consumer mood was positive (Ronald Reagan, Bill Clinton and George W. Bush). And they lost when it was negative or falling (George Bush -father- and Donald J. Trump).
People don’t eat indexes, but what they get in the store, respond the pollsters. And today, What alters your mood the most is INFLATION, in capital letters. By the way, the cost of living remains at 3.5 percent annually, relatively low since the peaks of the pandemic.
But the average price remains at a brutal 18 percent — brutal by American standards. It is a level that exceeds the records from the time Biden arrived at the White House, and wage increases cannot compensate for that loss.
Americans spend 11 percent of their income on food, the highest level in three decades, and their historical memory of consumers has been damaged: it is difficult for them why they spent 30 years paying the same deodorant for 4 dollars and now it costs them 8 dollars. And so with many basic and everyday products.
President Biden is confident that consumer mood has experienced a slight rise since the beginning of the campaign, to the highest level in three years. The same thing happened to Obama in 2012 (he was short, but rising).
This is probably why Biden put the economy at the heart of his latest “State of the Union Address” before Congress, to defend a model of generation of wealth “from the social center outward” and “from the bottom up”in contrast to another of reducing taxes for the rich so that they can “spend it down.”
Perhaps if the economy stops worrying voters so much, particularly his own, Biden will be able to lead Trump to settle the election in other fields of debate, where he can gain a minimal advantage in the competition, even at the cost of going back over the rift that divides the “two souls” of the United States today.
*Former Ambassador of Argentina to the United States. Author of The two souls of the United States. Journey to the heart of a fractured society.
