It’s not unusual to see a president inherit a difficult economic challenge not of his own making. Ronald Reagan was handed an economy in free fall. Barack Obama came to office in the middle of a financial crisis.
But to hear President Joe Biden and his team tell it, he was dealt an unusually bad hand back in January 2021 when he took the oath of office — one far worse than his predecessors. Although the COVID-19 economy had already begun to turn around in the last months of the Trump administration, to listen to Biden, the challenges he faced dwarfed those of other administrations.
He couldn’t be more wrong.
Reagan and Obama came into the White House in the midst of major economic problems. When Reagan took office, the country was reeling from 11.8 percent inflation and 7.5 percent unemployment. When Obama took the reins in January 2009, he faced unemployment at 7.8 percent, a wobbly financial sector and a country on edge.
When Biden became president, the inflation rate was 1.4 percent. Much of the work to bring down the COVID pandemic’s historic unemployment was already underway as unemployment had dropped from a high of 14.7 percent in April 2020 to 6.3 percent by January 2021, lower than both Reagan and Obama in their first month in office.
But there is a significant difference between Biden and the approach of the previous presidents. While the unemployment numbers continued to decrease under Biden, returning to 2019 pre-COVID levels, his solution to the COVID economy was a package of trillion-dollar spending bills that generated a whole new problem: a sharp increase in the rate of inflation.
Unlike Reagan, who was handed a double-digit inflation rate that had been ongoing for almost two years, Biden got an inflation rate that was remarkably low, which he promptly squandered with his decision to trade the successful supply side economics of Reagan for the long-discredited economic policies of central planning.
But despite sluggish growth, continuing inflation and wage increases that have failed to keep up with rising prices, Biden and his Democratic colleagues on the Hill are still peddling the idea that what they call “Bidenomics” is working. There’s just one problem with that narrative. The data simply doesn’t back up the claim.
Yes, unemployment has returned to 2019 levels, although with a slightly lower percentage of Americans in the workforce. But after 29 months of “Bidenomics” in action, the Winston Group’s latest Presidential Inflation Rate (PIR) has hit a new high of 16.6 percent.
Biden and his economic team would have us believe inflation has been tamed, using year-over-year CPI numbers rather than the PIR which, simply put, measures how much prices have changed from the president’s inaugural month to the present day. It reflects the cumulative effect on prices for goods and services since the beginning of a presidential term rather than 12 months ago.
Because “Bidenflation” reached near historic levels after the passage of his trillion-dollar legislative packages in 2021 and 2022, the PIR provides a more accurate reflection of the inflation people are feeling.
Last month, the Biden administration applauded the year-over-year inflation rate of 3 percent. What they don’t seem to understand is that when people walk into a grocery store, after suffering from two years of high inflation, technically a 3 percent inflation rate may reflect a less dire result, but people’s grocery bills are going to continue to increase. And that is the number that really matters.
Biden and his team have, at times, misrepresented their progress on inflation with the price of gasoline being the most egregious example. The White House claims that the cost per gallon of gas has come down significantly under his leadership, leaving the impression that Biden faced high gas prices walking into the Oval Office. Last October, Biden told a crowd in Syracuse, “Today, the most common price of gas in America is $3.39, down from over $5 when I took office.” Even Politfact called this claim false.
Data from the U.S. Energy Information Administration shows that in mid-January 2021, the price of a gallon of gas was $2.46. Under Biden, by June 2022, the nationwide monthly average for a gallon of gas hit $5.03.
But using the year-over-year CPI for gasoline, the White House tries to claim Bidenomics has made tremendous progress in reducing gas prices. That statement flies only if you ignore the fact that Biden’s economic policies pushed the average price of gas to over $5 a gallon for the first time in history a little over a year ago.
The Presidential Inflation Rate, on the other hand, reflects reality — that the price of gasoline, according to the CPI, has increased 52.5 percent since Biden was inaugurated.
Now we’re seeing gas prices on the rise again. From Christmas week 2022 to July 24 of this year, the price of a gallon of gas has gone from $3.20 to $3.71 – a 16 percent increase.
People who fill their grocery carts and cars every week simply aren’t buying the Bidenomics’ narrative. In a poll done last week by CBS News, it is clear that Biden’s credibility is in trouble. His job approval on the economy was 34 percent/66 percent approve/disapprove. Job approval on inflation was a remarkable 30 percent/70 percent approve/disapprove. Not surprising when 69 percent of voters said the costs of goods and services were going up not down.
When asked how much Biden’s policies are responsible for the current state of the economy, 80 percent said either a great deal or somewhat, while 70 percent said their incomes were not keeping up with inflation. This response makes perfect sense when you look at the Presidential Inflation Rate of 16.6 versus the Presidential Rate of Hourly Earnings at 12.2 percent — leaving Bidenomics with a 4.4 percent negative wage gap.
Bidenomics isn’t working and neither is the White House campaign to recast the Biden economic policies. Trying to dress up central planning as America First isn’t going to change his poll numbers.
The Bidenomics messaging campaign, so far, has not convinced an increasingly unhappy electorate. Who are you going to believe, Biden’s narrative or the prices you are actually paying?
Editor’s note: The author is an elections analyst for CBS News.
David Winston is the president of The Winston Group and a longtime adviser to congressional Republicans. He previously served as the director of planning for Speaker Newt Gingrich. He advises Fortune 100 companies, foundations, and nonprofit organizations on strategic planning and public policy issues, as well as serving as an election analyst for CBS News.