As the 2024 presidential election approaches, the U.S. economy is exhibiting a mix of resilience and concern. The economy expanded robustly in the third quarter of 2024, with a growth rate projected at 2.8% according to the International Monetary Fund [e9932ba6]. Consumer spending remains strong, reflecting a recovery in consumer confidence, yet fears of delinquency are rising among households [e9932ba6].
Despite these positive indicators, job growth has slowed significantly, with nonfarm payrolls increasing by only 12,000 in October, marking the weakest growth since 2020 [daeab420][e9932ba6]. Unemployment remains low at 4.1%, but the slowing job market raises concerns about the sustainability of economic growth [8b13254a]. Additionally, inflation, which peaked above 7% in mid-2022, has decreased to 2.1% as of September 2024, yet the lingering effects of high prices post-COVID-19 continue to weigh heavily on public sentiment [e9932ba6].
Donald Trump has been vocal in his campaign, drawing comparisons between the current economic landscape and the challenges faced during the COVID-19 pandemic. He emphasizes that the economy is now 11.5% larger than it was at the end of 2019, and inflation-adjusted output has risen by 2.66% from Q3 2023 to Q3 2024 [0ff32baf]. However, he has made contradictory statements, labeling the economy as both 'good' and 'a disaster' while blaming Vice President Kamala Harris for ongoing issues [26be2589].
Harris faces significant challenges as she campaigns on the economic front. Recent polls indicate that voters view Trump as more trustworthy on economic issues, with 54% of Americans mistakenly trusting Trump more with the economy despite the positive economic growth reported [64efe233][b497e7f0]. Allen warns that while inflation is currently low, the U.S. purchasing power remains second globally, and negative inflation could lead to disastrous outcomes reminiscent of the Great Depression [f6508f6].
The Federal Reserve's recent decision to cut interest rates by 0.5% aims to stimulate further economic activity amidst these fluctuations [715109ac]. However, job growth data for October is expected to be skewed due to external factors such as hurricanes and a strike at Boeing, which may complicate the narrative around job creation [b497e7f0].
As early voting begins on October 28, 2024, the economic sentiment will play a crucial role in shaping voter decisions. A recent New York Times/Siena College poll shows that 52% of voters prefer Trump over Harris for economic management, despite the positive economic indicators [d31cab0d]. Allen also highlights concerns over federal debt, which is expected to reach 99% of GDP this year, projecting potential Social Security defaults by 2031 under Trump’s policies [f6508f6][e9932ba6].
In summary, while the U.S. economy has shown signs of recovery and growth compared to the dire conditions of 2020, the upcoming election will test whether these improvements resonate with voters who remain concerned about inflation and economic stability. Since 1989, 51 million net new jobs have been created, with 50 million under Democratic leadership, contrasting with Trump's net loss of 2.7 million jobs [64efe233][357810f5]. The worsening income inequality, with the top 1% earning 21% of personal income, adds another layer of complexity to the economic narrative as voters head to the polls [8b13254a].