“In 2021, we had the fastest economic growth since 1984. The Biden economic plan is working, folks,” blared the official Twitter account of President Joe Biden. Since much of the media will play along with this nonsense, let’s fill in the dots.
Yes, US Gross Domestic Product grew 6.9% last quarter (on an annualized basis) and 5.7% for the full year, which is indeed the best since President Ronald Reagan’s landslide re-election. But this was simply a rebound from the pandemic shutdowns that saw a deep contraction; indeed, the biggest single contributor to growth was a buildup in inventories.
And the economy was going gangbusters both pre-pandemic and in the final quarter under President Donald Trump. Once Biden took office, the expansion actually slowed: Last quarter was the first all year that growth met expectations — and only because they’d been lowered because of the earlier disappointing performance.
And crucially, the nation is still 3 million jobs short of restoring the 22 million lost to COVID and the lockdowns in 2020.
Meanwhile, the International Monetary Fund this week downgraded its expectations for 2022 US growth, from 5.2% to 4% — a stiffer downgrade than for other developed nations. Among the reasons: The Federal Reserve will be hiking interest rates to start getting inflation (now at a 40-year high) under control.
That inflation, by the way, means that workers in 2021 actually lost ground when it comes to the value of their paychecks.
So how, exactly, is Biden’s economic plan “working”? His main impact on the economy has been the near-$2 billion spending bill passed last spring, now widely seen as fueling the record inflation. (The cash has barely started going out the door from the infrastructure bill passed in the fall.) And his anti-energy policies (killing pipelines, denying drilling permits, threatening new “carbon” taxes, etc.) have helped spur soaring energy costs, another inflation-driver.
Like virtually everything else he tells the nation, “The Biden economic plan is working” was just empty malarkey.