The U.S. unemployment rate ticked up once again to 4.1 percent in June, according to the latest data compiled by the U.S. Bureau of Labor Statistics, in what is surely bad new for President Joe Biden and whomever might be considered to replace him on the ballot as the Democratic nominee should he step aside.
No matter what, whether it’s Vice President Kamala Harris or someone else, that person would inherit the Biden economy, which has seen unemployment increase by 1.1 million since Dec. 2022 to its present 6.8 million level. Another 162,000 became unemployed in June alone.
Meanwhile, when inflation was peaking in 2022, the growth of consumer credit peaked at 9.9 percent annually in April 2022, but in April 2024 (the most recent reading) that growth rate has slowed down significantly to just 1.9 percent growth of consumer credit.
This is what typically happens after peak employment as the economy overheats, the American people max out their credit and curb purchases, and inflation cools. Eventually this leads to layoffs and upheaval, and has been seen the unemployment rate rise from its April 2023 low of 3.4 percent now up to 0.7 percent to the current 4.1 percent.
Meaning, whether it’s President Biden in the White House and on the ballot, or Harris, a slowing economy will definitely be weighing on voters’ minds, who are still reeling from the inflation seen the past few years.
That might make Harris or whoever else Democrats come up with as not much more than a sacrificial lamb. Besides the obvious economic concerns that might make holding onto the Presidency more difficult for the incumbent party, the sheer chaos of replacing a sitting president potentially against his will — there is talk of invoking the 25th Amendment to remove the enfeebled Biden — will almost certainly not be seen by the American people as a vote of confidence in the current administration.
Even a voluntary resignation by Biden, yielding the White House to Harris, might not quiet concerns, especially if Biden’s health problems have been widely known for some time now, as questions will shift to the new president about what she knew and when she knew it.
Even on policy, when questions about the economy come up, assurances by Harris that the economy remains strong and unemployment relatively low may ring hollow and unauthentic. If Harris could not properly evaluate the President’s mental fitness when under the 25th Amendment that’s her job, how can she be trusted to properly evaluate the lingering impacts of inflation and their aftereffects on the economy including labor markets?
Harris would be forced to say that she supported Biden’s policies 100 percent, including all the spending that has fueled the inflation as the M2 money supply grew by almost $7 trillion during and after Covid amid a spending, borrowing and printing binge by Congress and the Federal Reserve.
In other words, Democrats including Biden and whoever might replace him, own the economy, own the inflation and own any future unemployment that ensues. There’s already 1.1 million more jobless since peak employment, and the situation might not improve much before November for the incumbents. As usual, stay tuned.
Robert Romano is the Vice President of Public Policy at Americans for Limited Government Foundation.
