A major divide exists between the positive economic outlook pushed by “ivory tower” economists and the dour picture confronting everyday Americans at the grocery checkout and gas pump, posing a challenge for Vice President Kamala Harris as she contends with the pros and cons of “Bidenomics,” a leading trade group CEO told The Washington Times.
“I’ve never seen the gulf this wide,” Michael Bright, head of the Structured Finance Association, told The Times’ Tim Constantine.
As the presidential race heats up, Mr. Bright said government economists see a declining rate of inflation, a relatively stable job market and robust corporate earnings, so it’s not surprising to hear them praising the “miracle” economy.
Yet even as the official rate of inflation falls, consumers are stuck at a higher cost plateau after years of price increases for eggs, milk and other items under the Biden-Harris administration.
“All those price increases are still baked into the basket of goods and services that you buy, so you go out and talk to somebody in Pennsylvania or Ohio and they’re going to say, ’I don’t understand how the economy is good when everything that I buy is everything that I buy is more expensive than it was four years ago,’” Mr. Bright said. “So that’s a difficult task for the Harris campaign — how they are going to manage [it].”
Mr. Bright served as interim president of Ginnie Mae — a government housing loan corporation — from mid-2017 to early 2019 before taking over as CEO of the Structured Finance Association. The SFA says its mission is to expand economic growth by enabling credit access to industry members, consumers and investors.
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Mr. Bright said it is fine for the Biden-Harris administration to highlight its jobs record, given the current low unemployment rate and recovery from the COVID-19 pandemic, especially compared to the performance of other nations.
But on the flip side, the Federal Reserve misjudged the nature of inflation. Biden officials thought inflationary pressures from the pandemic would be transitory, yet prices kept increasing.
“That was a big miss, and that really impacted people’s pocketbooks and their quality of life and their ability to afford everything in their daily life,” Mr. Bright said.
Those price increases are displayed for people in neon lights whenever they pass a gas station.
“Net-net, I don’t see [Bidenomics] as a political winner. I would probably look at other issues,” Mr. Bright said.
Mr. Bright described the current political and economic climate as a dynamic and exciting one.
“I would not call it ’stable,’ that would not be the word I would use. But ’interesting’ — and maybe not the worst thing for us at this moment — is kind of how I feel,” he told Mr. Constantine.
The political world was turned on its head in July, when former President Donald Trump, the GOP presidential nominee, survived an assassination attempt at a campaign rally and Mr. Biden dropped out of the race, clearing the way for Ms. Harris to become the Democratic nominee.
Mr. Bright said it’s easy to feel “confused” about the path forward under either candidate.
He said Ms. Harris was a “very progressive” senator, so he is looking for “any signs of a tack to the center as it relates to financial regulations, as it relates to economic stuff.”
“I think she’s trying to do that, but we really don’t have a lot of record of her in a governing model,” Mr. Bright said.
Mr. Bright said Mr. Trump surrounded himself with experienced business figures during his first term, providing “calming influences” against radical instincts that pushed for big tariffs and trade barriers.
He said it is hard to say whether “Trump 2.0” will operate with the same advisers to Mr. Trump at the White House.
Mr. Bright also said a recent Supreme Court decision on the Chevron regulatory doctrine is “kind of a big deal” and will impact the role of government no matter who wins in November. The justices in June said courts do not have to defer to agency heads when a law is unclear, as precedent had instructed judges to do for roughly three decades.
The 6-3 decision effectively stripped authority from executive agencies looking to implement their rules and regulations by filling in blanks when Congress is unclear.
“We’re just beginning to think through the consequences of that, but that could be a multidecade turning point in terms of the role of regulators in making decisions that shape the economy, which I think could be a very good thing,” Mr. Bright said.
On the election, Mr. Bright said voters should evaluate how each candidate would affect the economy, society and their lives instead of getting caught up in the theatrics of the campaign.
“I think we get obsessed with personalities sometimes and don’t really pay attention to policy stuff,” he said. “Look through the noise.”
• Tom Howell Jr. can be reached at thowell@washingtontimes.com.
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