The economic record Republicans want you to remember
Alabama Sen. Katie Britt used an odd turn of phrase when she delivered the Republican rebuttal to President Biden's State of the Union speech on March 7.
"Are you better off now than you were three years ago?" she asked voters.
This phrase sounds like a common piece of campaign rhetoric — except it's missing a year.
Ronald Reagan famously asked voters, "Are you better off today than you were four years ago?" at the end of the 1980 presidential campaign, when incumbent Jimmy Carter was running for reelection amid double-digit inflation and rising unemployment. Voters decided they weren't better off, and Reagan won.
Many presidential challengers have since used Reagan's rhetorical formulation to challenge the incumbent's economic record. A four-year time reference calls into question an opponent's full four-year term as president. So, why did Britt shorten it to three years?
Four years ago, during Donald Trump's last year in office, the COVID pandemic was erupting, the stock market was crashing, and a recession was just getting started.
In March 2020, 1.4 million Americans lost their jobs; in April of that year, this number ballooned to north of 20 million.
And this is much more than a technicality: Trump has his own record to run on as he faces Biden in the 2024 presidential race, and he needs voters to remember the first three years of his presidency while forgetting about the fourth.
"Four years ago, before I came into office, the country was hit by the worst pandemic and the worst economic crisis in a century," Biden said during the State of the Union speech last week.
He helpfully reminded viewers that crime and murder rates soared as lockdowns became the norm, and COVID killed more than 1 million Americans.
Trump, for his part, would also prefer that voters think even more about 2022 when considering Biden's economic record against his own. That's when inflation peaked at 9% and gas prices crested $5 per gallon.
The annualized inflation rate has since fallen to 3.1%, and gas prices are back around $3.40 as Biden's fourth year in office gets underway.
But voters aren't over it and Trump wants to keep it that way.
Biden's approval rating sank to around 40% as inflation rose, and it's still in the basement. The lasting sting of inflation is probably Biden's biggest vulnerability.
The year that went away
So far, the GOP's strategy seems to be working.
A majority of voters recall the Trump economy as good, while a minority rate the Biden economy the same way. In polls, Trump leads Biden on his handling of the economy by about 10 percentage points.
Biden, meanwhile, explicitly wants Americans to compare 2024 with 2020, when COVID was gripping the nation and many businesses were shutting down.
Should COVID and the chaotic effort to deal with it four years ago count against Trump? It's a political Rorschach test that could determine who wins in November.
Comparing each president's economic performance during the first three years in office ends in something like a draw.
Economic growth was slightly better during Biden's first three years, and job growth was far stronger under Biden. But inflation was lower under Trump. Real income, adjusted for inflation, also rose during Trump's first three years and has been flat under Biden, because inflation has offset income gains.
Further into the fourth year, however, the comparison is likely to tilt heavily in Biden's favor, as the following charts show.
The COVID recession was short but severe, and damage wasn't repaired until after Trump left office. Repair that Biden's economic record is getting credit for.
During Trump's first three years in office, for instance, the economy added 6.7 million new jobs. But mass layoffs during COVID left the US economy with 2.7 million fewer workers when Trump left office than when he entered the White House four years earlier.
GDP growth per capita was 6.3% after Trump's third year but just 4.9% after his fourth year, according to data from Moody's Analytics. That's because output shrank during the COVID recession.
Now, some measures of Trump's last year in office look good on paper, but largely for the wrong reasons.
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After the stock market tanked in March of 2020, it went on a tear as the S&P 500 closed the year up 16%. However, unprecedented stimulus measures taken by Congress and the Federal Reserve helped goose these financial market returns.
Average incomes also soared in 2020, but only because lower-paid workers in retail, travel, and other service sectors were disproportionately laid off, making higher-paid workers a larger chunk of the labor force.
Biden clearly wants voters to keep Trump's entire four-year record in mind. He frequently says Trump had the "worst jobs record since the Great Depression" and regularly compares Trump to Herbert Hoover, who presided haplessly over the first years of the Great Depression.
And though the COVID pandemic is over, lasting side effects will still influence how Americans vote in 2024.
Most Americans, in reality, are better off now than they were four years ago. But it was a much simpler question when Reagan asked it. And harder to answer if you only ask about three of them.
Rick Newman is a senior columnist for Yahoo Finance. Follow him on Twitter at @rickjnewman.
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