Did Bidenomics really work? President Biden believes so. At least, he must convince himself that it worked if he wants to get reelected in November 2024. In a speech delivered in Chicago, President Biden embraced the term “Bidenomics,” arguing that Americans’ livelihoods have improved under his watch and will get even better if he is elected for another four years, according to The Guardian.
Biden Approval Ratings, 2021-2023
Source: AP News NORC
Polls show Biden receiving low marks from voters for his economic record amid a two-year inflation spike that eased but remains historically high. According to the Associate Press NORC, the economy is a weak point for Biden within his own party, especially among young Democrats. Just 47% of Democrats under age 45 approve of his handling of the economy, while 33% of total adults approve of his handling of the economy. The overall approval ratings show that only 41% of Americans approved his work as president in June 2023. To really determine if Bidenomics worked, let’s first understand what it is.
Bidenomics is simply the name given to the economic policies of President Biden. In the 1980s, the economic policies of the Reagan administration were called Reaganomics, named after President Ronald Reagan.
ABC 12 News defines Bidenomics as the economic theory that rejects the idea of “trickle-down” policies in favor of focusing on the middle-class. The concept of “trickle-down” economics is a concept associated with the economic policies of President Reagan.
The economic policies of President Reagan rested on four major objectives: (1) reducing government spending on domestic programs, (2) reducing taxes for individuals, businesses, and investments, (3) reducing the burden of regulations on business, and (4) promoting slow money growth in the economy. The trickle-down theory argues that a decrease in taxes for corporations and wealthy individuals will stimulate economic growth. If the expenses of corporations are reduced, the savings then “trickle down” to the rest of the economy, spurring overall growth. And Bidenomics presents itself as the pure antithesis of Reaganomics.
Bidenomics argues that the supply-side policies of trickle-down economics have cost jobs and hollowed out the middle-class. Bidenomics argues that the stimulation of consumer demand is what stimulates economic growth. According to Bidenomics, the economy grows when the government applies expansionary fiscal policy to encourage consumer demand, by increasing government spending on domestic programs such as public infrastructures and welfare programs. In other words, Bidenomics is nothing else but Keynesian economics.
Under Bidenomics, government spending and the national debt catapulted. The U.S. government spent more than $4.1 trillion alone in the fiscal year 2023, compared to $3.80 trillion for the same period last year, while federal revenue declined from $3.37 trillion last year to $2.9 trillion this year, according to fiscal data of the Department of the Treasury. Thus, budget deficit increased from $426 billion last year to $1.1 trillion this year, which is a 173% increase. The U.S. government spends more than it generates revenue.
Moreover, the Biden Administration increased taxes on wealthy individuals and corporations to fund his public infrastructure programs. President Biden planned to increase corporate income tax to 28%. According to the Tax Foundation, raising the corporate tax rate to 28% would reduce long-run GDP by 0.7% and eliminate 138,000 jobs.
Did Bidenomics make Americans better-off as President Biden gloated about? If yes, then his approval ratings on the economy would be much higher than what they currently are. But the evidence suggests otherwise. Americans are not content with Biden’s policies.