The ruling President Joe Biden and his associates have begun advertising “Bidenomics” as an important element of their manifesto for the re-election campaign.
Bidenomics, short for economic policy of the Joe Biden administration, is a new term for the dictionary and common citizens.
The US Presidential election due in November of this year is near our doorsteps now. The ruling President Joe Biden and his associates have begun advertising “Bidenomics” as an important element of their manifesto for the re-election campaign. It is not sure if the citizens have appropriately understood the message, but it will be a wait-and-watch situation as to how it unfolds.
Bidenomics, short for economic policy of the Joe Biden administration, is a new term for the dictionary and common citizens. Generally, it is the sum of economic benefits provided by Mr Biden, which can be showcased during election campaigns. It is not unusual as every ruling political party tries to take all the credit for whatever growth happens in the economy during their tenure and sidelines all the negatives of the economy.
The Democrats are campaigning to build the economy on the basis of a ‘middle out and bottom up’ approach. This has become the kiln to forge bricks to be used in the construction of the concept of Bidenomics. This approach has been specifically developed to differentiate and attack directly on the quintessential ‘trickle down economic’ idea of the Republicans.
The former President Donald Trump, a candidate of the Republican party, moved forward with the party’s economic policy of turning lenient towards stringent restrictions. He advocated reducing regulations and taxes on business organisations and decreasing the taxes levied on high-net-worth individuals. According to such a policy, the economic investment would boost, in turn, benefiting the middle and lower classes. The Trump administration made the largest reform in the tax system, providing the largest permanent tax cuts to business houses and ultra-rich individuals, also called the major legislative change during his tenure.
Democrats have been quite loud in bashing the Trump administration’s economic approach, while Bidenomics follows a totally different path. It is more focused on utilising government funds for public infrastructure, research & development and other social spending activities to strengthen the economy. Biden has opted to increase taxes on corporations and wealthy individuals to fund his policies of public expenditure.
Bidenomics approaches only those for public investment, which the president believes is important for driving economic growth and will provide the utmost benefits to the citizens. The key sectors highlighted by the president are semiconductors, renewable, manufacturing and infrastructure. They are also giving attention to enhancing the quality of labour through various training programmes and union policies to empower workers and build trust.
In recent times, the White House has drafted several policies that focus on securing funds inside the borders of the country. This is done to ensure that employment is generated for US citizens and to decrease dependency on imports.
Covid pandemic
Joe Biden has prior experience as a vice president of the US during the Great Recession in economic recovery policies. In the mayhem of Covid-19, he flooded the markets with tremendous amounts of fiscal stimulus. He ignored all the warnings from his teammates and experts regarding the repercussions of quantitative easing. He is now ordering the Fed to control the skyrocketed inflation by its monetary policies.
Since the pandemic, the US has registered better economic growth than its fellow developed economies. The rate of inflation has decreased, and the core inflation is relatively lower as compared to other rich nations. The rate of unemployment has also come down to a record low of 3.5%. The government gives credit for major economic and job growth to the American Rescue Plan Act of 2021, the Infrastructure Investment and Jobs Act of 2021 and the latest Inflation Reduction Act of 2022.
Upcoming elections
Biden’s claim holds a certain degree of truth regarding their claims of economic growth, but in a bigger picture, they have been very keen on taking specific data that aligns with their agenda and amplifying them. This garners criticism from Republicans that Biden’s policies have only increased the government’s impact on the economy and inflation.
The election is due in November this year and will ultimately decide how satisfied Americans are with Bidenomics. Voters’ perspectives are not built on statistics and numbers but on the basis of their wallets. Recently, inflation has been the most pressing problem for both the government and voters. It skyrocketed to a decadal high of 9.1% last year, though it has cooled down but is still higher than normal.
Inflationary problems have decreased Biden’s approval ratings for economic management. A recent media poll uncovered that 51% of US citizens think that the economy is worsening. This has also affected Biden’s approval rating, tanking it to 37%. Although some economic indicators show that the economy is on a path to recovery, the on-ground problems still stay intact. Americans also have a belief that Republicans are better at handling economic turmoil, which is also a perception that Democrats are struggling to fight.
Bidenomics is a big bet, and if things turn in favour, then it can be a huge win. The only thing in the way is the American voters’ perspective, who will decide whether his economic policies have made their lives better or it is just another hoax. If the mindset of voters doesn’t move towards believing that the economy is improving, then Bidenomics will instead benefit Trump.