If President Joe Biden is hoping to mitigate the midterm election shellacking that the party in the White House usually sees, the last thing he’d want to see is this headline: “57% See Depression Ahead.”
Yet that’s the headline coming from a Sept. 28 Rasmussen poll. And economic expectations have only deteriorated since then.
According to the report: “The latest Rasmussen Reports national telephone and online survey finds that 57% of American Adults believe it’s likely that, over the next few years, the United States will enter a 1930s-like Depression, including 21% who think a depression is Very Likely.”
What exactly is an economic depression? Investopedia defines it as “an extreme recession that lasts three or more years or which leads to a decline in real gross domestic product (GDP) of at least 10% in a given year.”
With two quarters of negative economic growth so far, some economists think the United States is already in a recession. And those who don’t think we will likely be in one soon.
That pessimism is justified.
Corporate profits have been high, helping to weather the economic storm, but that may be changing. Biden and his fellow Democrats think government spending and heavy-handed regulation make companies and the economy run more smoothly, and so they’re doing their best to expand both. In fact, massive government spending and regulation stifle investment and innovation and slow economic growth.
In addition, Democrats and the Federal Reserve Bank have flooded the economy with money, essentially pouring gasoline on what was a simmering inflation fire. All of those factors have played a role in the sorry state of the economy.
And it’s not just the United States. Economic dark clouds are everywhere, with economists continually reducing their predictions for global economic growth in 2023 and beyond.
But while an economic depression is unlikely, the fact that the public has turned so sour on the economy, and on Biden’s ability to manage it, should be very concerning to Democrats hoping to minimize midterm losses. It’s not so much whether the economy is in a recession or even a depression. It’s the public’s perception of how the economy is doing that voters will take to the polls.
If a majority think we are heading for a depression, they’re likely to vote for a change.