It’s Biden’s booming economy, stupid!

Winning a second term should be a cakewalk. [Bloomberg]( This is Bloomberg Opinion Today, an economic mantra of Bloomberg Opinion’s opinions. On Sundays, we look at the major themes of the week past and how they will define the week ahead. Sign up for the daily newsletter [here](. [This Stupid World]( “It’s the economy, stupid!” It was one of the great catchphrases of American politics. It was also a total con job. For those of you too young to know James Carville from Mary Matalin[1](#footnote-1), that mantra of Bill Clinton’s 1992 presidential campaign, and the supposedly weak economic outlook under George H. W. Bush, powered the challenger to victory. There is only one problem: the message was largely false. Yes, there had been a brief recession from roughly mid-1990 to the spring of 1991, [caused by]( factors including the Savings and Loan Crisis of the late 1980s, the oil-price shock of Saddam Hussein’s invasion of Kuwait and ensuing Gulf War, job loss in manufacturing due to drops in defense spending as the Soviet Union collapsed, and the inevitable return to stasis after the longest-ever peacetime expansion under President Ronald Reagan. But by Election Day 1992, pretty much everything had turned around: Employment was [rising at a 2%]( quarterly rate; current-dollar GDP was reaching [nearly 6% annually](; personal income had increased by a total of $51 billion in October alone; inflation was at 3% (a point above the Fed’s current ideal but hardly a crisis). The [headline]( of the St. Louis Fed’s National Economic Trends report issued days before the election was “The Expansion Has (Finally) Arrived.” Yet three-quarters of Americans disapproved of Bush’s handling of the economy, and almost none of his behavior in [supermarket checkout lines](. (I have sympathy for Bush’s befuddlement over barcode scanners, as I’m that guy who’s always holding up the self-checkout line at the Whole Foods in Hudson Yards.) Yet not only did Clinton’s [“I feel your pain”]( narrative get traction, it kept voters from thinking of the other things Clinton had been feeling lately, such as [Gennifer Flowers](. The St. Louis Fed was right about the boom, and the guy not yet in office got the credit for it. Which brings us, of course, to President Joe Biden and former President Donald Trump. Coming off Friday’s jobs report, Bloomberg News [trumpeted]( “US Jobs Roar Again as Payrolls Jump 303,000, Unemployment Drops.” Inflation is again [around 3%](, down from 9% in 2022. We have so far [avoided the recession]( that 100% of economists — I am not making that up!! — in a Bloomberg probability model considered inevitable in late 2022. The S&P 500 is at all-time highs, as is average household net worth. Real-wage inequality is shrinking. If you need more convincing, look at Bloomberg Opinion’s [massive data dive]( into a whole bunch of metrics, which concluded, “If presidential elections hinge on ‘[the economy, stupid](,’ then winning a second term should be a cakewalk for Biden.” Unfortunately for the president, that cake seems to be [made of chocolate](. Some [60% of Americans]( disapprove of Biden’s handling of the economy, according to the number crunchers at Real Clear Politics. He has an overall approval-disapproval gap of [minus-16%](, according to the number crunchers at 538.com. Nearly three in four Americans list [“strengthening the economy”]( as their top policy priority, according to the number crunchers Pew Research Center. (Anyone else wondering how many of those 303,00 new jobs went to number crunchers?) The University of Michigan consumer sentiment index has been [flat all year](. The Conference Board’s latest [consumer expectations index]( was 73.8, and “a reading below 80 often signals a forthcoming recession.”[2](#footnote-2) Time magazine recently told us “[The Economy No Longer Matters for Presidential Approval](.” The newsmag is a few decades late on the scoop. And Matt Winkler thinks that narrative may not hold in one of the seven states that will decide November’s election. “Georgia, whose population of more than 11 million makes it the eighth-largest state, is booming like it never did before Joe Biden became the 46th president,” Matt [writes](. “The truism among historians that presidents can't take credit for the economy is [belied by growing evidence]( from independent analysts showing the Biden administration’s policies are an unrivaled jobs juggernaut dating back to World War II.” Just as it took American economic power to rescue Europe in that conflict, Mohamed A. El-Erian sees “American exceptionalism” at work now. “US economic data overall has been stronger than consensus forecasts. The other is [lower-than-expected]( euro zone inflation data,” Mohamed [writes](. “The US economy is on a healthier endogenous growth path compared with Europe. In addition to being supported by a more favorable set of initial conditions — from greater flexibility in factors of production to more agile entrepreneurship – US growth has also been boosted by a bigger fiscal impetus and stronger policy focus on the drivers of future economic growth.” In other words: OK, we’re crushing Europe and all’s well in the Peach State, but what about workers in the other 49? “Employment figures are deceptively difficult to get right, and have always been subject to big revisions,” [writes]( John Authers. “Post-pandemic, there is reason to trust the official numbers even less because the number of companies responding to surveys has fallen acutely. The closest approach we have to a reliable real-indicator, weekly claims for unemployment insurance, counsels against getting too excited. Combining the number of initial claims with the twice-monthly data on continuing claims shows that the total has been remarkably stable at about 2 million since last summer. It looks like the employment market has found a level.” “In monetary policy, there’s a school of thought that you can have too much of a good thing. Too many jobs, too much wage growth, too much economic output — it’s all potentially inflationary, as the thinking goes,” [counters]( Jonathan Levin. “Or, at least it is in normal times. In today’s context, that line of thinking is probably wrong … it’s hard to view any of what we learned from Friday’s report in a negative light.” No matter how many times Biden hits the switch, that light won’t shut off. Also, he’s running against Trump, not Europe. And it doesn’t look good, does it? A CBS poll last month [found]( that 55% of respondents think the former White House resident would do a better job of dealing with the economy, compared to 33% for the current occupant. Yet Karl W. Smith [thinks]( Trump’s successes are overrated: Back in 2017, the debate around President Donald Trump’s tax cuts was a case study in how quickly a discussion around legitimate policy can descend into partisan nonsense. On one side, Republicans spouted unfounded claims that the tax cuts [would pay for themselves.]( On the other, Democrats spouted equally unfounded claims that only big business and the wealthy would benefit. As usual, the truth landed somewhere in the middle ... while the cuts yielded benefits to Americans up and down the income scale, the benefits could best be described as modest. Now, everybody has to applaud Karl for the unprecedented feat of getting the words “Trump” and “modest” in such close proximity. Bonus [Super Stupid]( Reading: - Sorry, But Joe Biden [Can’t Build]( Your EV Charger — Mark Gongloff - Markets Are [Seeing a Cyclical Recovery](. Forget Landing — John Authers [What’s the World Got in Store](? - Boeing Q1 orders/deliveries, April 9: Boeing’s Board [Must Look]( in the Mirror for Its Next Shake-Up — Beth Kowitt - Fed Open Market Committee minutes, April 10: The [Fed Is Wrong]( About How Low Interest Rates Will Go — Bill Dudley - Japan-Philippines-US Summit, April 11: [Biden Counters China]( by Partnering Japan and the Philippines — Hal Brands [Welcome to the Working Week]( How many jobs do you have? Just a decade ago, that might have seemed like a dumb question — certainly among those of you paying thousands of dollars a year to enjoy my dad jokes on the Bloomberg Terminal. You either had a job or you didn’t. But then came the “gig economy,” and “side hustles” became a fulfilling and creative way for young (and mostly [well-educated]() Americans to get by. This was a real thing, even if it spawned a bunch of questionable [trend pieces]( about the “Great Resignation” and “lying flat” and “quiet quitting” and other things Sarah Green Carmichael describes as being “based largely on anecdata and a catchy phrase.” But I hadn’t really thought of whether these gigs had a significant macroeconomic effect, and if so, whether it would be good or bad. Claudia Sahm [did my thinking for me](: Some pundits have expressed concern that part-time work (less than 35 hours per week) and not full-time accounts for most of the recent gains in employment. The implication is that part-time jobs are of lower quality, so the labor market is not as strong as the top-line numbers suggest. Such views miss key features of part-time work — ones that reinforce the strength of the labor market and policies that would improve the quality of part-time work even more … While part-time jobs have a reputation for being bad jobs — and it’s true these jobs typically pay less and rarely offer benefits such as health insurance — they provide necessary flexibility for many workers. For example, such work allows some mothers with young children to balance caregiving responsibilities while keeping a foot in the labor market, which is important when it comes to future job opportunities. But is what’s good for those with toddlers also good for those with grand-toddlers? “America needs to start thinking [more]( [creatively]( about work,” [writes]( Allison Schrager, who has her own side hustle as a retirement economist.[3](#footnote-3)“One reason the conversation around increasing the retirement age has become so politically toxic is that too many people see working as a binary: You’re either working full time or not at all. This makes no sense. The US can find ways to subsidize people who physically can’t work in their 60s and still strongly encourage everyone else to work longer. It may be part-time work, which many people can do into their 70s. Staying partially engaged in the labor force is incredibly valuable both financially and mentally.” It also may be necessary. Consider these two charts from Allison: So, thank goodness for the gig economy, because my kids are going to need all the side hustles they can get to provide me a dotage in the lifestyle to which I have grown accustomed.[4](#footnote-4) Notes: Please send Georgia peaches and feedback to Tobin Harshaw at tharshaw@bloomberg.net. [1] If you are, I'd recommend subscribing to [this]( and watching [this](. But maybe not [this](. Or you'll end up feeling like [this](. [2] Anyone who can explain the Conference Board's mystifying metric to me in words of three syllables or less wins a free bag of Whole Foods organic arugula. [3] Allison, a senior fellow at the Manhattan Institute, might consider that her day job and her Bloomberg column the side hustle. You say potato ... [4] In truth, one of my children is an indy filmmaker and the other an art dealer, so I fall into that category Allison S. may think of as "work till you drop or develop a taste for cat food." Follow Us Like getting this newsletter? [Subscribe to Bloomberg.com]( for unlimited access to trusted, data-driven journalism and subscriber-only insights. Before it’s here, it’s on the Bloomberg Terminal. Find out more about how the Terminal delivers information and analysis that financial professionals can’t find anywhere else. [Learn more](. Want to sponsor this newsletter? [Get in touch here](. You received this message because you are subscribed to Bloomberg's Opinion Today newsletter. If a friend forwarded you this message, [sign up here]( to get it in your inbox. [Unsubscribe]( [Bloomberg.com]( [Contact Us]( Bloomberg L.P. 731 Lexington Avenue, New York, NY 10022 [Ads Powered By Liveintent]( [Ad Choices](