If you ask an American follower of the Democratic Party about the presidential poll data, they will complain about the irrationality of those who want to vote for Donald Trump. Thanks to Joe Biden's policies, they will say, inflation has gone down and the economy has avoided recession. The labor market is strong and, as a bonus, the stock market is up.
If, as James Carville, Bill Clinton's strategist, said, the US presidential elections revolve around “the economy, stupid,” Biden's second victory should be a piece of cake. Voters disagree. In the most recent Reuters/Ipsos poll, Biden and Trump would be tied if the election were held today rather than Nov. 5. But a poll taken in December in undecided (or swing) states showed Biden with only a slight lead in the seven states where the elections were closest in 2020: Nevada, Arizona, Wisconsin, Michigan, Pennsylvania, North Carolina and Georgia. If Robert F. Kennedy, an independent candidate, were added to the ballot, Trump would win handily.
US elections are decided by each state's electoral votes, meaning the winner of the popular vote gets that state's full allotment. These allocations are added to form a national count. The system confers an outsized influence on the undecided states, in which voters lean towards one option or another, or in which there is a balanced mix of Democrats and Republicans. In several previous elections, the winner did not win the popular vote, but reached the White House thanks to the swing states. On Monday, Trump handily won the first caucus (primary elections) Republican, in Iowa, a state that used to swing, but is now firmly in the Conservative party's camp. And unless legal cases being reviewed by the Supreme Court keep him off the national ballot, he is likely the Republicans' pick to challenge Biden in a very close race.
Part of Biden's problem is that he took over the most powerful office in the world just as the US was being ravaged by Covid-19. He pumped $1.9 trillion in stimulus into the economy, including direct payments of $1,400 to some households. He also launched the Infrastructure Investment and Jobs Act, the Chips Act, and the Inflation Reduction Act (IRA), a series of emergency laws intended to create jobs and revive parts of the economy that desperately needed a jolt. . Some of the effects of these policies have not yet been felt. For example, workers in some conservative-leaning states, such as Arizona, should benefit from subsidies for the construction of microchip factories.
Thanks in part to these measures, the economy has avoided a recession, the labor market is strong and inflation, which had skyrocketed due to the aftershocks of the pandemic and Biden's fiscal waste, has been reduced.
In this context, it is easy to see how voters inclined to support Biden view his victory as inevitable.
The problem with this narrative is that the first two years have taken their toll on the general perception of Biden's tenure. Because inflation had risen so much, in 2022, real household income across the US was down 5% compared to 2019, according to the St. Louis Fed. In Nevada, Michigan, Arizona, North Carolina and Pennsylvania, Americans fared even worse. In Nevada and Pennsylvania, real incomes fell more than 10% in that period.
Although the pace of rise in consumer prices has slowed and incomes are growing, many Americans find it difficult to shake the feeling that they have become poorer in recent years.
Two states are bucking this trend. Georgia, a southern state that has historically gone to Republican candidates but is now considered swing, where real incomes are up 5% since 2019. And Wisconsin, where incomes followed the national average.
living place
Housing is another sore point for Biden, especially at the local level. The nerds of political analysis have focused on a handful of counties that will decide the elections in each of the swing states because they punch above their weight. In 2020, residents of Maricopa County, Arizona, for example, influenced the statewide vote. Biden won that county by just two percentage points.
The Atlanta Fed offers granular data on housing by county, and the affordability metrics don't look good to the president. See Kent County, Michigan, which includes the city of Grand Rapids and is a key election area. In January 2020, 22% of the average person's annual income went toward paying for housing, within the 30% threshold that the Fed considers “affordable” for the average American. That calculation takes into account income, house prices and interest rates. By September 2023, it had risen to more than 35%.
In Phoenix, which is in Maricopa County, that figure went from 28% to 45%. In Reno (Nevada), the largest city in the key Washoe County, it is more than 54%, compared to 34% at the beginning of 2020. In Wilmington (North Carolina), where Biden turned around the results in 2020 by for the first time in decades, it went from 30% to 48%.
And even if inflation is falling now, thanks to aggressive rate hikes by the Fed, many voters have yet to see the benefits. With such a significant portion of Americans' paychecks going toward keeping a roof over their heads, even if egg prices go down or incomes go up, it's difficult to move the needle on their overall financial well-being.
The economy may be pushing undecided voters to elect Trump. That said, not everyone lets their wallet dictate their voting preferences. And many things can change between now and November. With Fed Chair Jay Powell warning of rate cuts in the coming months, growth could pick up and people could start to feel better.
The problem for Biden – and his supporters – is that while they can logically argue that he succeeded in the Herculean task of leading the country through a devastating pandemic, and that the people of Pennsylvania or Arizona, for example, could have state even worse without the Chips Law, there is no easy way for voters to know. For now, all they know is that they feel poorer than they did four years ago. Unless their mood improves before November, they will inevitably blame the man in charge.
The authors are columnists for Reuters Breakingviews. The opinions are yours. The translation, of Carlos Gomez Belowit is the responsibility of Five days
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