We got more good economic news this week when the growth rate for the third quarter was adjusted upward to a sizzling 5.2 percent, even as inflation continued to subside. The stock market rose to a high for the year, and there seems little doubt that the economy is headed for a soft landing of low inflation and low unemployment. Even the economists most resistant to this turn of events, like Jason Furman, are starting to acknowledge it.

Commentators are obsessed with the question of why Joe Biden is not getting more political credit among ordinary voters for the obviously improving economy. They keep looking for polling errors, or technical misunderstandings, or partisan selective memories of the pre-pandemic, pre-inflation good times under Trump.

The estimable Paul Krugman recently ran a column pointing out that while inflation did outpace wages from March 2021 to April 2023 (most of the Biden administration, in fact) wages have been rising faster than inflation for the past several months. What’s wrong with people for not appreciating this and crediting Biden for the turnaround?

He concludes: "While the public’s negative view of the economy is a major puzzle, acknowledging that puzzle is no reason to soft-pedal the evidence that the U.S. economy is currently doing very well—indeed, much better than even optimists expected a year ago."

Except the public’s negative view of the economy should not be a major puzzle at all. Ordinary people have been taking it on the chin for about four decades, during which time virtually all GDP gains were captured by the very rich. People suffered more during the COVID inflation despite Biden’s heroic efforts to mitigate that suffering, and those relief programs are now expiring.

The economy’s deep structural changes include more gig jobs and fewer real payroll jobs, a far less reliable retirement system, impossible costs of both rental housing and homeownership, and a crushing debt-for-diploma system. (Borrowers just started paying on those student loans again after a three-year hiatus.) A few months of modest statistical improvement in real wage growth outstripping inflation doesn’t change those fundamentals, and thus doesn’t change attitudes.

Even though inflation has indeed moderated, that experience is offset by high interest rates on everything from mortgages to credit cards to car purchases. The Fed is expected to desist from further rate hikes when it meets again on December 12–14, but not to cut rates as it needs to do.

Bloomberg just ran a devastating piece, item by item, on just how much highly visible costs to consumers (rent, insurance, electricity, groceries, meals out) have risen since the pandemic began in 2020. Some of these price hikes reflect pure gouging by ever more concentrated sellers; and it helps when Biden goes after them, as he did in this recent speech.

But too few consumers make that connection. And this disconnect between Biden’s genuine accomplishments and the lived economic experience of most voters gives a free ride on the key issue of the economy to Donald Trump.

The old rule of politics still holds that elections are mostly referenda on incumbents. It is profoundly unfair that Biden did about as well as any president could have done with a very challenging economy and a disappearing working majority in Congress. But who ever said life is fair, much less politics?

You owe it to yourself to read several recent chilling pieces on Trump’s increasingly open embrace of fascism and the very genuine risk that he could defeat a struggling Biden—especially this one by Robert Kagan, this earlier piece by Tom Edsall, and this one from our own Harold Meyerson.

Should an aging Biden continue to stumble, and especially should he perform badly in the New Hampshire primary, where new rules imposed by Biden himself force him to run as a write-in candidate, the debate among Democrats will grow more explicit: Is the takeaway that every sane political leader needs to be all in for Biden? Or that Biden should step aside in favor of a nominee with a better chance of sparing America full-blown fascism under Trump?