In the final phase of the election campaign, the economy is a hot topic for both the hopeful Joe Biden and the incumbent President Donald Trump.
The coronavirus has brought economies around the world to a standstill, and governments are being confronted head-on with the short and long-term problems of isolation and widespread unemployment.
From support for companies to individuals, high-level action was needed, whether it was rescuing the airline industry, saving jobs, intervention by central banks or the provision of unemployment benefits.
The economic collapse of the coronavirus is comparable to the devastation wreaked by the global financial crisis in 2007 and 2008, and will be the focus of attention of voters in November when they go to the polls.
During this election cycle, Trump’s economic track record will also be scrutinized. Economists will evaluate his term in office and the impact that some of his policies, from fiscal to stimulus, have had on the American people.
“The trump card was an economic catastrophe,” Nobel Prize winner Joseph Stiglitz told the Spanish newspaper El País.
“Remember that in December 2017 Trump cut taxes for billionaires and corporations and in the same law increased them for most of the people in the middle who have struggled over the last 40 years,” he continued. “What Biden has promised is to undo this and make companies and large fortunes pay fair taxes, which I believe is good economic policy. The 2017 tax cut has given the economy a sugar boost, but any economic model will tell you that this is not sustainable, that it will lead to record deficits”.
Why it matters
According to recent polls, the economy is one of the most important issues for voters and could be a decisive factor in the November 3rd election.
A Gallup poll conducted in October showed that almost nine out of ten registered voters considered the presidential candidates’ positions on the economy to be “extreme” (44 percent) or “very” (45 percent) important for their election.
In addition, polls in the Financial Times, published this week, showed that more Americans believe that the president’s economic policies will harm rather than help the recovery. This was a significant decline since the beginning of the pandemic.
Trump claims to have a solid economic track record, citing the markets as a vote of confidence in his leadership and as a barometer of economic success. Shares have continued to rise during his tenure.
Both the S&P 500 and the Nasdaq have reached record levels in recent weeks and are sensitive to comments from both Trump and Federal Reserve Chairman Jerome Powell.
In addition, Trump has done comparatively well on a number of indicators, including the fact that the unemployment rate has improved from the horrific levels of April under his presidency. Employment is now comparable to the level reached at the same time of the Obama administration in his first term before his re-election.
“We had such a strong foundation that we are recovering much faster than anyone expected,” President Trump said at a recent press conference on the economy.
On taxes, the difference in the two candidates’ economic proposals split along party lines, with Trump promising more tax cuts and easier regulation, while Biden promises higher taxes and increased government spending on social welfare.
It is difficult to compare the candidates’ policies because Biden presented detailed plans, while Trump issued a series of bullet points with few details.
Some experts say that Biden’s promises do not match, while it is difficult to say whether Trump does or does not, as there is no detailed information.