The turning point in Americans’ perception of the economy — that
despite months of doom-colored predictions of a looming recession — may
have occurred on Jan. 25.
That was the day that Fox Business
economic commentator Larry Kudlow, a former official in the Trump White
House and consistent dispenser of grim economic predictions during
President Biden’s term, went on Fox’s “America Reports” telecast and acknowledged that the Biden economy was, you know, good.
Instead
of contracting, the economy has continued to grow....Inflation has come
down significantly. ...The labor market is healthy.
— Treasury Secretary Janet Yellen
Candidly,
if a bit glumly, Kudlow stated, “It was a good quarter, don’t get me
wrong, and the last quarter was a good quarter, 4.9.” Biden, he said,
“gets his due. If I were he, I’d be out slinging that hash too, no
problem.” Asked by the host if this meant that the economy was not as
bad as he had been saying, he answered, “I would say, probably, I would
agree.”
Fox being Fox, Kudlow couldn’t resist sticking the shiv
in: “Wages are rising more slowly than prices,” he said, which doesn’t
happen to be true: Wages and benefits for rank-and-file workers have grown faster than prices throughout the post-pandemic period.
The bottom line, however, is that if the bad-economy camp has lost even Larry Kudlow, they’re on the wrong side of the argument.
[...] Administration officials have been trying to spread the word. “Instead of contracting, the economy has continued to grow,” Treasury Secretary Janet Yellen told the Economic Club of Chicago
on Jan. 25. “It now produces far more goods and services than it did
before the pandemic. ... Inflation has come down significantly. ... The
labor market is healthy.” The unemployment rate, she noted, “has been
below 4% for 23 months now, a stretch that has not been seen during the
last 50 years.”
Moreover, Yellen said, the current recovery has
been “the fairest recovery on record,” with wage and employment gains
for the middle class and demographic groups such as Black and Hispanic
workers. And the U.S. recovery from the pandemic has outstripped those
of other developed countries: “The increase in real wages is unique to
our country’s recovery: in other economies, real wages have declined
since 2019.”
Hourly
earnings growth for rank-and-file workers (blue line) has exceeded
inflation (red line) since the onset of the pandemic in March 2020. Gray
stripe signifies a recession.
(Bureau of Labor Statistics)
Unionized
workers have been among the leading beneficiaries of economic growth,
achieving strong improvements in wages and working conditions at unionized auto plants and United Parcel Service.
The Fed holds sway over interest rates, and could move in a way reversing this trend. That reality stands against boasting too much. But can't we let Joe boast a little?
Hourly earnings growth for rank-and-file workers (blue line) has exceeded inflation (red line) since the onset of the pandemic in March 2020. Gray stripe signifies a recession.(Bureau of Labor Statistics)