President Joe Biden’s campaign to be the commander-in-chief for another four years hit yet another massive bump in the road as some rather unsettling economic news was sent across his desk. Recent gross domestic product figures did not meet expectations, which is making politicians and economists alike chew their fingernails down to the quick over worries that a stagflation situation similar to that of the 1970s is creeping our way.
The professionals were expecting the GDP to hit growth of 2.4 percent, but the actual number was an abysmal 1.6 percent. As that number comes in far, far below what was expected, the United States is also experiencing a continual uptick in inflation, which is making it very difficult for the current administration to stabilize our economy.
Trending News Politics is reporting:
Experts on Fox News Business pointed to the dual threat of sluggish growth coupled with persistent inflation, noting the Federal Reserve’s admission that inflation is not only “sticky” but also trending adversely. Economic analysts are raising the alarm over the potential for stagflation, a condition characterized by slow economic growth, high unemployment, and rising prices. Such an environment could pose significant challenges to Biden’s campaign for 2024, as voters often base their ballots on economic performance.
“I was preparing myself for using the word ‘stagflation’ because that’s something we haven’t seen since the 1970s,” Fox News Business commentator David Asman stated during a segment on the program concerning the economic data. This historical parallel draws comparisons to the economic strife that haunted the Carter administration decades ago.
The U.S. economy grew at a slower pace in the first quarter of 2024, with real gross domestic product (GDP) expanding at an annual rate of 1.6%, according to preliminary data from the Bureau of Economic Analysis. This marked a significant deceleration from the 3.4% growth recorded in the fourth quarter of 2023.
Key components contributing to GDP growth included increased consumer spending, higher residential and nonresidential fixed investment, and more state and local government spending. However, these gains were somewhat tempered by a decrease in private inventory investment and an uptick in imports, which subtracted from total GDP calculations.
Consumers have spent increasing amounts of cash on services like healthcare and others related to financial matters, while the spending for vehicles and energy products took a tumble. The actual GDP increase in dollars was $28.28 trillion, which is up by $327.5 billion from the last quarter.
“The GDP price index and personal consumption expenditures (PCE) price index both rose, indicating heightened inflationary pressures with the PCE price index, excluding food and energy, climbing to 3.7%,” the report revealed.
Trending News Politics also said, “Personal income also saw a substantial rise, driven largely by higher compensation and government transfer receipts, leading to an increase in disposable income despite higher personal taxes. However, the personal saving rate dipped slightly compared to the previous quarter.”
In other words, the economy’s growth is slowing way down while inflation is persistent and that is bad news for all Americans, but especially the middle-class. Officials from the Federal Reserve recently stated that in order to control interest rates, they might have to keep interest rates where they are right now. And that just happens to be the highest levels we’ve seen in almost 20 years.
All of this is increasing the anxiety of voters who are finding it more difficult with each passing day to make their ends meets. More folks are living paycheck-to-paycheck as economic conditions continue a downward spiral. This, of course, does not bode well for Biden’s re-election efforts, which no doubt has his campaign and the ilk he packed his Cabinet with sweating through the sheets at night.