Record High US Share Market, Cooling Inflation, But Biden Faces Tough Polls in Key Battleground States
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By The Smartencyclopedia Newsroom

The US stock market has reached a record high, inflation has cooled, unemployment remains just below 4 percent, and GDP is steady. However, these positive economic indicators seem to have little impact on voters in two crucial battleground states, Nevada and Georgia, where former president Donald Trump is significantly ahead of President Joe Biden in recent polls.

Economic Metrics vs. Voter Sentiment

Polling in Nevada and Georgia, states with the narrowest margins in the 2020 election, shows Trump leading Biden by 13 points in Nevada and 10 points in Georgia. This stark contrast to the seemingly robust economic data underscores Biden’s struggle to convince voters of his administration’s economic success.

A recent Gallup survey revealed that confidence in Biden’s economic management has plummeted to its lowest point since the survey began over two decades ago. Only 38 percent of US adults expressed faith in Biden’s economic stewardship, compared to 46 percent for Trump. Furthermore, only 2 percent of voters rate the economy as excellent, while 56 percent say it’s poor.

The Disconnect: Inflation and Household Budgets

Although the annual inflation rate has cooled from over 9 percent in mid-2022 to 3.4 percent in April, household budgets have not fully recovered since Biden took office. For every $100 of goods and services an American bought in January 2021, they now need $120 to purchase the same items. The typical American household’s annual spending budget of $66,936 in 2021 would now need $80,233 to maintain the same standard of living.

While wages have increased, they haven’t kept pace with rising costs. Average weekly earnings have risen only 14 percent since January 2021, to $1,191 from $1,044.56. This discrepancy is likely a significant factor in voters’ dissatisfaction with Biden’s economic management.

Voices from Nevada and Georgia

In Nevada, voters like Hondo Khadi, a 40-year-old Uber driver in Las Vegas, express their disillusionment. Despite voting for Biden in 2020, Khadi plans to withhold his support this time. He cites rising unemployment among black men, from 4.6 percent last year to 5.2 percent, and concerns about immigration as key issues.

“I’m not a Trump supporter, nor am I a Biden supporter. It all depends on what they claim to be bringing,” Khadi says. “I want things like lowering taxes so that we don’t have to pay as many. I’m all for closing the borders and border restrictions, and those types of things.”

Similarly, Jacob Sprague, a 32-year-old systems engineer in Reno, Nevada, shared his frustrations with the New York Times. He highlights increased costs of living, saying, “I’m paying more on taxes and more on groceries and more on housing and more on fuel. So, that doesn’t feel good.”

In Georgia, Greg and Jamie Luttrull, who refrained from voting in the 2022 mid-term elections, now intend to vote. They feel Biden has not addressed their concerns about childcare, gas, and grocery costs. Greg Luttrull remarks, “Since Biden took office, our bills took off too. I don’t think Biden has any good ideas, and I don’t think Biden is even in any sort of coherent control.”

Biden’s Economic Policies and Inflation

Some economists and strategists argue that Biden’s fiscal policies, such as student loan relief, have contributed to inflation. Bill Sterling, Global Strategist for GW&K, notes that the fiscal impulse – the rate of change in the deficit – has affected economic growth and inflation. The deficit doubled from about $1 trillion in fiscal 2022 to $2 trillion in 2023, partly due to student debt relief.

While Biden’s initiatives like the Inflation Reduction Act, Bipartisan Infrastructure Law, and Chips and Science Act have supported company earnings and pushed up share prices, these benefits may not resonate with the broader population. The Dow Jones hit 40,000 points for the first time, a milestone that might cheer the 58 percent of American households who own shares, but it remains irrelevant to the 42 percent who do not.

The Political Challenge Ahead

Despite a strong stock market and improving economic indicators, Biden faces significant challenges in convincing voters of his economic policies’ effectiveness. US consumer sentiment has sagged to a six-month low, with the University of Michigan reporting a larger-than-expected drop across all demographics and political affiliations.

Voters like Greg Luttrull express a desire for change: “At this point, I don’t care if Trump [posts] mean things. We had an economic boom and world peace the four years he was in office, and now our economy is garbage and there’s ongoing wars all over the place.”

Democratic strategists must address this disconnect between economic metrics and voter sentiment. Lowering the inflation rate further may help restore a sense of prosperity, particularly in key battleground states like Nevada and Georgia, where the outcome of the upcoming presidential election could be decided.

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