As the U.S. braces for the upcoming presidential election, former President Donald Trump has voiced his concerns about inheriting a fragile economy reminiscent of Herbert Hoover’s era.
In a recent interview with Lou Dobbs on January 8, Trump expressed his apprehension about the current state of the economy, emphasizing, “We have an economy that’s so fragile, and the only reason it’s running now is it’s running off the fumes of what we did … It’s just running off the fumes.”
Trump hopes to avert economic crash, CBO predicts slowed growth
He added, “And when there’s a crash, I hope it’s going to be during this next 12 months because I don’t want to be Herbert Hoover. The one president I just don’t want to be [is] Herbert Hoover.”
This statement came after President Joe Biden likened Trump to Hoover at a Boston campaign reception.
Recent predictions by the Congressional Budget Office (CBO) indicate a slowdown in the U.S. GDP growth in 2024, followed by a recovery in 2025.
The CBO report states, “GDP falls from 2.5 percent in 2023 to 1.5 percent in 2024 as consumer spending weakens and investment in private nonresidential structures contracts.”
Projected economic growth amid rising unemployment
“In 2025, real GDP growth rises to 2.2 percent, supported by lower interest rates and improved financial conditions.”
Additionally, the unemployment rate is expected to increase from 3.9 percent in Q4 2023 to 4.4 percent in Q4 2024, hovering near that level through 2025.
Experts, including Desmond Lachman of the American Enterprise Institute, are cautious about the economic outlook, warning of a potential recession before the 2024 election.
The Biden administration faces public discontent over its economic management.
Polls show Americans worry over inflation and Biden’s low approval
A CNN poll last month revealed significant concerns among Americans about rising costs, with Biden’s job approval rating dropping to 37 percent in December.
Despite the U.S. GDP showing positive growth rates in the first three quarters of 2023, Michael Wilkerson of Stormwall Advisors points out the disconnect between official figures and public sentiment.
He notes, “Americans’ rapidly shrinking wallets—i.e., their diminished purchasing power—result from inflation,” adding that since 2020, Americans have lost nearly 20 percent of their purchasing power.
A Bankrate survey corroborates this sentiment, with 59 percent of Americans feeling the U.S. economy is in a recession.
Inflation’s impact on American household’s finances
The effects of inflation on American households are stark. A November 2020 to November 2023 comparison by Bankrate shows 50 percent of Americans feeling worse off financially, with 81 percent unable to increase their emergency savings in 2023.
Forbes magazine Editor-in-Chief Steve Forbes, in a Newsmax interview, predicts more consumer challenges in 2024.
He asserts, “The consumers are not going to forget that prices are higher today than when Joe Biden took office.”
Forbes is critical of the U.S. Federal Reserve’s efforts, stating, “The U.S. Fed is trying to help Joe Biden” with its monetary policy, but he doubts its effectiveness for the economy.
Economic uncertainty and political implications
The U.S. economy’s uncertain trajectory and the Federal Reserve’s monetary policies are focal points in the pre-election landscape.
Trump’s concerns about a potential economic downturn mirror public anxieties about inflation and financial stability.
As political leaders and experts weigh in, the nation’s economic health remains a crucial factor influencing the upcoming presidential race.