I find the ritual post-election blame games and score settling rather distasteful.
But pinpointing what went wrong is important, especially if you can identify mistakes in the past which, if corrected, will lead to better governing in the future.
And I think two mistakes were made by President Joe Biden very early in his presidency which led to the widespread perception of a mismanaged inflationary economy that ultimately felled Kamala Harris’s campaign.
First, here’s the latest post-election commentary from the Washington Monthly:
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Blue Wall Turns to Rubble; Democrats Despondent: Executive Editor Digital Matthew Cooper sums up Tuesday’s night political carnage. Click here for the full story.
I Asked Trump if Women Should Be Punished for Having an Abortion. He Said, “Yes.”: Contributing Writer Chris Matthews reflects on his 2016 interview with Donald Trump, and its role in the 2024 campaign. Click here for the full story.
Democrats Will Win Again Once the Economy Tanks: My analysis of how lingering frustration with inflation doomed Harris, but also reminds how quickly the political pendulum can swing. Click here for the full story.
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As I acknowledged in my column today, all the Election Day evidence suggests that, despite my prior belief that a growing Gross Domestic Product, low unemployment and healthy two-year increase in real disposable income (a metric which accounts for inflation), the perception of a rotten economy still wracked by high prices prompted a major nationwide shift towards Trump.
This is an historic anomaly. Never in modern times has an economy this good, without an unpopular war involving American ground troops souring the electorate, led to the defeat of the incumbent party’s presidential candidate.
Clearly the public wasn’t “feeling” the economic improvement, with the rising inflation of 2021 and 2022 leaving behind elevated prices today. But why? Early economic troubles that get addressed in advance of the Election Day have not thwarted incumbents before.
For example, Ronald Reagan in 1984 presided over an economy that was on the upswing—with a growing GDP and reduced inflation–after the recession of 1981 and 1982. Yet, as I wrote in February, the unemployment rate, the poverty rate, and the 30-year average mortgage rate weren’t any better than four years prior. Reagan nevertheless won in a landslide on a “Morning in America” message that favorably compared the improving numbers to the so-called stagflation under his predecessor Jimmy Carter.
Democrats should have be able to run a similar campaign this year, but two decisions made in 2021 by Biden complicated matters.
The first was to snub the offer from a Senate Republican group led by Susan Collins for a $600 billion bipartisan pandemic relief bill, in favor of the $1.9 trillion American Rescue Plan Act, which was passed on a party-line vote in March 2021 through the filibuster-proof budget reconciliation process.
Biden could have tried to split the difference. One Republican senator said in February 2021 that the Collins offer “wasn’t our end point,” and Biden said after the bill passed that he would have been open to a bipartisan deal as low as $1.2 trillion.
The logic at the time was “go big” to avoid tipping into recession. But by going big and going alone, Democrats would own not just potential benefits, but also potential consequences.
Democrats were oblivious to the risks; they saw ARPA as all political upside. If the bill was bipartisan, the political risks would have been shared.
Recession was avoided. But by July, inflation had begun to rise. Whether or not ARPA deserves any direct blame is highly debatable, since pandemic-driven inflation was a global problem. But Republicans had an easy case to make: Democrats voted for big spending, inflation followed. Biden needed to blunt such attack lines early and consistently.
Yet in July, Biden delivered a speech, meant to tout the nation’s economic progress, that downplayed recent inflation as likely “temporary” and “transitory.” This was his second mistake.
Granted, he offered the caveat that the White House would “remain vigilant” to prevent “unchecked inflation,” and they were already working on fixing “supply chain challenges” that were fueling inflation, efforts which were ultimately successful.
But sharply higher inflation lasted for the next two years, peaking at 9.1 percent in June 2022, far longer than “transitory” suggested, and leaving the impression the White House was asleep at the switch.
Biden could have raised a louder alarm in July or sooner, immediately blamed Trump and his mishandling of the pandemic for the underlying supply chain problems, and pledged to move heaven and earth to contain price increases as fast as possible. But Trump’s name was not mentioned in the July speech, nor was any urgency conveyed.
The Republicans of the Reagan era relentlessly trashed the Carter economy for years, eviscerating the Democratic brand until the recession of 1991 gave Bill Clinton a new opening. But Biden and other Democrats failed to hang the pandemic and its consequences around Trump’s neck when memories of his defeat were still fresh. As the Monthly’s Paul Glastris put it last January, “Trump was handed a booming economy by the Barack Obama/Joe Biden administration, managed for three years not to screw it up, then encountered a crisis, COVID-19, and choked.”
Moreover, Biden could have gone beyond criticism of Trump’s pandemic management and, as Glastris and the Monthly’s Phillip Longman urged two years ago, fingered the rise of corporate monopolization as the root cause of higher prices, and touted his aggressive antitrust agenda as the long-term solution.
Instead, Democrats left themselves vulnerable to Trump’s audacious revisionist economic history.
As a result, too many people believe Trump ran a perfect economy before 2020, give Trump all the credit for pandemic relief in 2020, and blame Biden for everything bad that happened after 2020.
Harris, coming in off the bench in July 2024, couldn’t reverse these perceptions in time for the election. She could only acknowledge frustrations with high prices and offer her own solution: a ban on price-gouging. But it’s hard to have the credibility for your economic plans for the future if you’ve already lost the perception battle regarding the recent past.
I don’t say this to demean Biden’s legacy. As we at the Monthly have exhaustively chronicled, the Biden policy record is broadly substantial and consequential.
But the moral of this story for future presidents is: never take inflation lightly.
Best,
Bill Scher, Washington Monthly politics editor
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