President Joe Biden is finally getting his own eponyms, for better or for worse. What sticks is not just consequential for the 2024 elections, but for markets and investors as well.
With the biggest legislative fight – the debt ceiling – completed, there are few areas of opportunity for action in a divided Congress. At the presidential level, Biden views little to be gained by commenting on the legal drama of former President Donald Trump. This leaves the White House going on the offensive in selling and implementing a new economic vision.
“Industrial policy” is out, “Bidenomics” is in.
Biden and White House officials are in the midst of an “Investing In America” tour, a 60-stop, 30-state romp through America to highlight Bidenomics.
“Under my plan, under Bidenomics, we’re creating jobs at home and exporting products abroad. Union jobs!,” Biden said at a rally in Philadelphia last weekend. He noted how Bidenomics is replacing the theory of “trickle down” economics.
There are multiple audiences to whom Biden is looking to sell Bidenomics. The most apparent is American voters. On the surface, there are some positive economic stories to tell. A White House deck on Bidenomics emphasizes how inflation has more than halved since last year, the labor market is historically strong, especially for African Americans and Latinos, and the American economy is recovering since the pandemic better than most other countries.
However, there’s a “vibes recession.” Americans continue to have a negative outlook on the economy. According to the latest Gallup poll, only 17% of Americans view the economy as good or excellent. Just 23% think the economy will stay the same or get better. The latest Pew Research poll shows Americans continuing to peg inflation as the biggest problem facing the country today. Republicans hold a 12-point advantage on economic issues.
Unsurprisingly, Republicans are using a different Biden eponym. Republicans on the House Ways and Means Committee have their own “Bidenflation” page. They passed legislation out of the committee this month that would repeal parts of the Inflation Reduction Act agenda that Biden enacted into law last year.
The voters have held a dim and steady view of Biden as of late. Views can change on the economy, but that may be from forces outside the power of a Bidenomics sales job, like interest rate policy from the Federal Reserve or the latest geopolitical developments in Europe or Asia. Perhaps more important for Biden, voters may be unhappy with his job handling the economy, but they will still vote for him anyways. Non-economic issues took precedence in many of the 2022 midterm races and could do so again in 2024.
Yet the Bidenomics sales job isn’t just for voters. Biden also needs industries, labor, investors, and global allies to believe Bidenomics is the real deal and is here to stay. Good implementation is critical. But so is expedient implementation with an election nearing.
A Politico report this month noted that the White House, led by Deputy Chief of Staff Natalie Quillian, is attempting to accelerate “thousands more investments in … bridge repairs, railroad upgrades, and clean energy initiatives.” They are also pushing the Cabinet to accelerate implementation of last Congress’ legislative achievements.
Just this week, the Energy Department’s Loan Programs Office announced a record commitment of up to $9.2 billion for a joint electric vehicle venture between Ford Motor
Beyond that, the administration is at a natural point in the regulatory and election cycle for an onslaught of major regulatory actions, as previewed in the latest semi-annual Unified Agenda of Regulatory and Deregulatory Actions. From stricter emissions standards to reworking equity market structure, enacting new credit card late fee limitations, and overhauling employee labor standards, the Biden administration is looking to propose and finalize regulations that could materially change large swaths of the economy.
The challenge of selling and implementing Bidenomics is that it’s full of competing priorities. It’s not just a domestic economic policy, but also a foreign policy framework – cultivating alliances with like-minded countries as a bulwark against China and authoritarianism. But several allies have grimaced at the protectionist positions America has taken in the name of Bidenomics. The concessions the administration has made towards allies, like on electric vehicles, has angered Democrats at home. Trying to tackle climate change, be pro-labor, lower inflation, and lead a global democratic alliance is a Rubik’s Cube. Trying to appease everyone can often end up satisfying no one.
Will Bidenomics persevere or will Bidenflation be the more cited eponym? Only time will tell. Other recent eponyms have had staying power. The Affordable Care Act, aka “Obamacare,” remains largely intact after years of legislative and court challenges. “Trumpism” is still a dominant force in Republican politics.
Just as these eponyms are bigger than the person they are named after, Bidenomics is bigger than just Joe Biden. There is a real sentiment shift in Washington, D.C. away from free markets and free trade and towards a more protectionist and proactive industrial policy. Bidenomics as a name may not stick; however, a Republican presidency or Congress could remarket it for today’s GOP rather than trash it outright. In that sense, Bidenomics may be here to stay.