https://www.foxnews.com/opinion/us-consumers-crush-bidens-reelection-hopes
Summer is over. Kids are heading back to school, workers are heading back to their jobs, and the 2024 campaign is heating up. Joe Biden is touting “Bidenomics” to voters, boasting of job gains and, finally, some rise in real income.
But Americans, who have been spending like crazy on vacations, eating out and travel, may be about to rain on Joe’s parade. Consumers are stretched financially, having financed their summer holidays and post-pandemic spending by saving less and borrowing more – not a sustainable trend. People have been willing to pile up debt because jobs have been plentiful and they’ve not worried about a sudden loss of income. That appears to be changing.
Plunging consumer confidence, rising debt delinquencies and a weakening jobs market suggest that the party could soon come to an end, with the economy hitting an unexpected rough patch as we approach election season.
Given that the Real Clear Average of polls on the president’s handling of the economy today shows only 38% approving and 58% disapproving, a downturn could clobber his reelection hopes.
A recession is not the consensus forecast. Despite aggressive interest rate hikes from the Federal Reserve, the economy has remained resilient, mainly thanks to unexpectedly robust hiring.
But now the jobs market is clearly sputtering, albeit from a frantic pace. In August employers added 187,000 jobs, far below the monthly average of 271,000 over the past year. While job gains have plummeted, reported additions for recent months have been revised sharply downward. Also, wage gains slowed last month. That is what the Federal Reserve has been hoping to achieve through its aggressive interest rate hikes. The question is, will hiring slow or turn into layoffs?
Employers across the country have defied prognosticators for months by continuing to add or keep workers even as corporate profits turned down. Companies had struggled to increase staff after the pandemic shutdowns, and were taking no chances of again facing a shortage of labor.