(Bloomberg Businessweek) -- White House officials started to panic about a month ago that Americans were not giving President Joe Biden credit for his economic achievements, say two sources familiar with their discussions.
Heading into the 2024 election, a majority of Americans feel sour about the state of the economy. Only 34% approve of Biden's handling of it, according to a June poll from the Associated Press-NORC Center for Public Affairs Research. That's lower than Biden's overall approval rating of 41%. Americans are still smarting from two years of historically high prices for everything—food, rent, travel, housing, cars.
Those worries were overshadowing Biden's accomplishments: He defused the debt-ceiling crisis. He passed through Congress sweeping bills to boost the green energy economy, subsidize the construction of new semiconductor factories, expand broadband access and repair hundreds of roads and bridges.
And recent data has shown inflation cooling, leading some economists to lower the odds of recession. “We are cutting our probability that a US recession will start in the next 12 months further, from 25% to 20%,” Goldman Sachs Group Inc. Chief Economist Jan Hatzius wrote in a report published on July 17. That same day, in an appearance on Bloomberg Television, Secretary of the Treasury Janet Yellen said, “I don't expect a recession.”
Even before the latest good news, top Biden officials decided they needed a rebrand, so they adopted the term “Bidenomics” as a way to repackage their existing policies for a public that feels lukewarm about the president. “Bidenomics takes the progress we're seeing today, the favorable trends we've seen in recent reports, and builds on them in the future. It seemed like an optimal time to be talking about it,” says Jared Bernstein, chair of the White House Council of Economic Advisers.
To be clear, Bidenomics involves no new policies. Instead, it's an effort to turn Biden's greatest political liability—the economy—into an asset. Talking up the state of the economy and Biden's long-term vision is a gamble for a president who's known more for his gaffes than his soaring oratory skills. When recently asked about the term—which aides brought to the president for his blessing—Biden simply told reporters it was “fine.”
“The challenge, which the administration is aggressively meeting, is to define what it is,” says Celinda Lake, one of the pollsters for Biden's 2020 campaign. “Too many people can't name anything that Biden has done.”
If the election ends up revolving mainly around voters' pocketbooks (in addition to abortion, democracy, foreign policy and immigration), then the Biden team knows it needs to address the economy head-on, even if a disconnect remains between voters' perceptions and the monthly data points, the majority of which are positive. “It is a risky strategy to tell people their feelings about how the economy is performing are wrong,” says Michael Strain, the director of economic policy studies at the conservative American Enterprise Institute. “It can make you look out of touch.”
Democratic presidents have turned political liabilities into selling points before, as Barack Obama did with the Affordable Care Act. The Tea Party movement gained popularity thanks in part to Republicans' anger over the passage of the sweeping health-care law, which they viewed as a form of government overreach. But as more Americans tapped into the expanded Medicaid program and received preventive care, and as health companies had to stop denying patients insurance because of preexisting conditions, the law became not only more popular but also embedded in society.
The Biden White House is now trying to do the same. Already, infrastructure money has gone to repair a collapsed bridge in Pennsylvania; Intel Corp. has broken ground on a new high-end manufacturing plant in Ohio; and there's a growing market for electric vehicles, boosted by funding from the Inflation Reduction Act. The White House wants Americans to see all these accomplishments as Bidenomics in action.
Yet most of the benefits may not become evident for another few years. Mark Zandi, chief economist of Moody's Analytics, estimates that the US economy will get its biggest boost from the infrastructure law, the Inflation Reduction Act and the CHIPS bill in 2026, years after the election. Biden may have won his second term by then, or a Republican could be back in the Oval Office, trying to undo every one of his policies.
Running on Bidenomics is a bit of a political juggling act. The White House—and eventually Biden's campaign—needs to sell Americans on his economic triumphs, while treating frustrated people with empathy. He also needs to talk about the long-term changes to the economy under this plan, including creating more green and high-end manufacturing jobs and breaking ground on a greater number of high-tech plants.
“For average Americans to remember something, they have to hear it seven times,” says White House communications director Ben LaBolt. “Given the fracturing of the media and how hard it is to reach people, we really need to hit people with it on a repeat basis.” LaBolt says the president, first lady, vice president and cabinet members will all be involved in the sales job.
In the meantime, the White House needs to pray nothing else upsets the plan. “The economy is very vulnerable to anything that could go wrong,” Zandi says. “The president has a lot to run on and very substantial policy, but he needs a little bit of luck, too.”
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