The president has had an off-and-on relationship with "Bidenomics" during the past year, however.Biden initially was reluctant to use the term, but last June he decided to embrace it. His advisers calculated that voters were going to blame — or credit — him for the country's economy regardless of what anyone called it.
The goal was to co-opt Biden's Republican critics and do for "Bidenomics" what former President Obama did with "Obamacare" — take a word that seemed a political liability and turn it into an asset.
In recent months, though, "Bidenomics" mentions by Biden, Democrats in Congress and others in the party have fallen off a table.It's a shift that amounted to an acknowledgement that the White House's messaging effort was falling flat with many voters.
By the numbers: Congressional Democrats initially followed Biden's plunge into touting "Bidenomics." They used the word 483 times last July in tweets, Facebook posts, press releases and floor statements, according to data from Quorum.But it wasn't long before those Democrats were grumbling to Biden's team that the White House was tone deaf in its branding as voters were struggling with inflation.
Rep. James Clyburn (D-S.C.), a close ally of the White House, was publicly critical.
Marijn A. Bolhuis, Judd N. L. Cramer, Karl Oskar Schulz & Lawrence H. Summers
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WORKING PAPER 32163
DOI 10.3386/w32163
ISSUE DATE February 2024
Unemployment is low and inflation is falling, but consumer sentiment remains depressed. This has confounded economists, who historically rely on these two variables to gauge how consumers feel about the economy. We propose that borrowing costs, which have grown at rates they had not reached in decades, do much to explain this gap. The cost of money is not currently included in traditional price indexes, indicating a disconnect between the measures favored by economists and the effective costs borne by consumers. We show that the lows in US consumer sentiment that cannot be explained by unemployment and official inflation are strongly correlated with borrowing costs and consumer credit supply. Concerns over borrowing costs, which have historically tracked the cost of money, are at their highest levels since the Volcker-era. We then develop alternative measures of inflation that include borrowing costs and can account for almost three quarters of the gap in US consumer sentiment in 2023. Global evidence shows that consumer sentiment gaps across countries are also strongly correlated with changes in interest rates. Proposed U.S.-specific factors do not find much supportive evidence abroad.
