'A middle-class problem': Why Biden’s 2024 challenge is overcoming feelings of 'economic angst'

05 July 2023

Many liberal pundits, from MSNBC's Lawrence O'Donnell to economist/New York Times columnist Paul Krugman, have been praising Joe Biden's presidency as an economic success story — hailing the Biden era as one of low unemployment and major job creation. And, to be sure, the United States' unemployment rate, according to the Bureau of Labor Statistics (BLS), was only 3.7 percent in May.

Krugman, however, has also expressed frustration over the fact that many Americans, even with low unemployment, have a negative view of the U.S. economy. Biden has been hailing "Bidenomics" as great for the middle class, describing it as a reason to reelect him in 2024. But how effective that messaging will be next year remains to be seen.

In a report published by Bloomberg News on July 5, journalists Shawn Donnan, Claire Ballentine, Alexandre Tanzi and Christopher Cannon examine feelings of economic "angst" among middle class Americans — and how those feelings may affect the 2024 election.

The reporters explain, "The core premise of Bidenomics is that the middle shall come first…. Yet as he gears up his 2024 reelection campaign for a vote that's now less than 18 months away, the president has a middle-class problem. Among the 100 million Americans with annual incomes between $45,000 and $180,000 and wealth between $100,000 and $1 million, polling commissioned by Bloomberg News shows persistent angst about the future. The post-pandemic surge in inflation and the Federal Reserve's reaction — the fastest increase in interest rates since the 1980s — have combined to put the middle class in a financial vice grip."

Donnan, Ballentine, Tanzi and Cannon add that middle class Americans "pay more for everything — food, homes, cars, energy — while the end of the easy-money era means loans, too, are more costly." The reporters go on to describe the economic concerns of Americans interviewed by Bloomberg News — for example, Mel Mills, a Detroit-based digital strategist and homeowner who "says he spends more on groceries and utilities than he ever has."

"In response to higher costs," they note, "homeowners are tapping into their housing wealth more often. Balances on home equity lines of credit rose by $3 billion in the first quarter of 2023, the fourth straight quarter of increases after almost 13 years of declines. To be a member of the U.S. middle class is also to be a member of an increasingly leveraged class facing higher costs to service debt as interest rates rise."

The Bloomberg News reporters continue, "The middle class held $7.8 trillion of the $18.3 trillion in debt owed by U.S. households at the end of 2022. That was $1 trillion more than at the end of 2019…. The good news for Biden and his reelection bid may be that the middle class is proving resilient."

Read Bloomberg News' full report at this link.

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