Hurray For the Biden Economy! But Is Anybody Going to Notice?

Nobody was driving when Biden took office. Our country was in a raging pandemic killing thousands on a daily basis and the economy was in collapse, while Trump kept telling us it was no big deal.

That's why gas was cheap. 1/2

— Ghastreblyansky (@Yastreblyansky) October 26, 2022

It's more your fault than Biden's, Senator Young. Take some responsibility.

— Ghastreblyansky (@Yastreblyansky) October 26, 2022

Honestly, this Indiana senator is on the committee (Commerce, Science, and Transportation) where the Gas Price Gouging Prevention Act died last spring, and maybe he didn't like that one, but he hasn't offered any alternative proposals either, or accomplished a single thing on the issue, or any other issue as far as I know.

Meanwhile, the actual pump price has gone back to declining, after that brief blip around the Saudi-engineered OPEC production cut (with which I imagine a lot of countries such as Russia aren't complying, because the price of crude oil is trending down as well—it's getting clear that the real purpose of the Saudi move was to help Republicans at the polls, their own October surprise, as Ken Klippenstein claimed at The Intercept a couple of weeks ago), and media aren't exactly hastening to tell us, but the national average as of today is $3.758 per gallon of regular, or just about exactly 25% down from the peak of $5.016 in mid-June (much higher in the West, including $4.29 in Arizona and $4.97 in Nevada; much lower in the South, including $3.39 in North Carolina, $3.29 in Florida, and $3.15 in Georgia; not so bad in the Midwest, including $3.60 in Wisconsin and $3.72 in Ohio; or $4.01 in Pennsylvania and $3.72 in New Hampshire—yeah, I'm thinking about Senate races).

And I think we can assume overall inflation is easing too, though it'll be a while before anybody really feels it, and the next Consumer Price Index numbers sadly won't be out until November 10, a couple of days after the election, but the Bureau of Economic Analysis reported on Thursday that

The price index for gross domestic purchases increased 4.6 percent in the third quarter, compared with an increase of 8.5 percent in the second quarter (table 4). The PCE price index increased 4.2 percent, compared with an increase of 7.3 percent. Excluding food and energy prices, the PCE price index increased 4.5 percent, compared with an increase of 4.7 percent.

PCE is Personal Consumption Expenditures; these numbers represent the increase over a year ago. The differences between Q2 and Q3 depending on whether you include food and energy or not show that the extraordinarily dominant part food and energy prices played in the inflation as a whole—the part that was shaking us all—is really just over.

Not only has inflation substantially slowed (around 4% annualized inflation was the point Krugman thought the Fed should really be aiming for, as opposed to the usual target of 2%), but growth is back, after two quarters of shrinkage, at an annual rate of 2.6%

While Friday's jobs report for October is expected to show continuing strong, but not too strong, demand for workers.

We've genuinely reached the point, I think, where things are looking sweet, and the greatest fear is now that the Federal Reserve will go and spoil it all by kicking off a recession (as they may well do this afternoon at today's Open Market Committee meeting, raising the interest rates another three quarters of a percentage point, though there are also lots of rumors that they'll be slowing the pace, at least, in the December meeting, as other central banks, like Canada's and Europe's, are doing, which is also good news. Even the stock market seemed remarkably cheerful last week, though it's a little nervous as I type.

Only will voters notice? If it was two weeks ago, I'd think maybe yes, but this close, with early voting already starting (I did mine on Sunday, first time as an early voter, on the way to our farmers' market, what a crunchy way to spend the midday hour), I am besieged with doubt. Who's even going to find out, unless they read The American Prospect? It's like the moment in the opera where everybody is reconciled but the consumptive heroine is already half dead—a glimpse of how happy we all could have been heightening the despair we'll be likely to feel!

I'll be over here if you need me, trying to find a way of getting back to upbeat.