Let’s face it. When you ask Americans their view on the state of the U.S. economy today and their outlook on the future, no matter who you ask, be it your neighbor who owns a small business, a coworker at the factory, or your spouse who teaches at the local elementary school, the feelings most people share are pessimistic or cautious at best. Those feelings are captured in some of the most recent data on consumer and business confidence that shows a clear decline under the Biden administration.
With Congress approving over $6 trillion dollars in spending in the last two years, a national debt now over $30 trillion dollars, a global pandemic that has only recently begun to wane, and fumbling leadership from the White House, American consumer confidence and CEO outlook for the future has hit new lows.
According to the Conference Board’s Consumer Confidence Survey in July, the Consumer Confidence Index decreased, following a bigger decline in June, down to 95.7 (1985=100), down 2.7 points from 98.4 in June. The Conference Board provides a Present Situation Index, “based on consumers’ assessment of current business and labor market conditions” which fell to 141.3 from 147.2 last month. The Board also provides an Expectations Index, “based on consumers’ short-term outlook for income, business, and labor market conditions” which also fell to 65.3 from 65.8.
“Consumer confidence fell for a third consecutive month in July,” said Lynn Franco, Senior Director of Economic Indicators at The Conference Board. “The decrease was driven primarily by a decline in the Present Situation Index—a sign growth has slowed at the start of Q3. The Expectations Index held relatively steady, but remained well below a reading of 80, suggesting recession risks persist. Concerns about inflation—rising gas and food prices, in particular—continued to weigh on consumers.”
Last month, the Federal Reserve raised interest rates, as expected, by .75 points, its second consecutive time. Taken with an 8.5% inflation rate, according to the U.S. Bureau of Labor Statistics Consumer Price Index (CPI) July report, the increased cost of common household goods like gasoline (up 44%), groceries (up 14%), and utility bills (electricity up 15%; gas up 30%), is taking a big toll on American livelihoods, and those sentiments are being reflected in the Conference Board data.
From the viewpoint of U.S. corporations, the Business Roundtable’s 2022 Q2 survey of 177 of America’s top CEOs showed major double-digit declines in the three categories that provide an outlook for the next six months: Plans for hiring, Plans for capital investment, and Expectations for sales.
“We urge the Biden Administration to double down on domestic energy investment and take additional action to address the elevated risk of a worsening global energy crisis. We also call on the Administration to lower tariffs,” Business Roundtable CEO Joshua Bolten said. “We strongly oppose efforts in Congress to impose tax increases on U.S. businesses that would erode America’s competitive standing and increase long-term economic risk.”
Republicans in Congress should heed this advice and continue to hammer the Biden Administration for their inflationary efforts that are usurping the hard earned living of millions of Americans. Inflation is a tax, one that swindles the middle and low-class more than the wealthy, and with the tax increases in the so-called “Inflation Reduction Act,” recently passed by the Democratic Congress, the Republican message should remind Americans of Biden’s broken promise not to tax Americans making less than $400,000.
House Speaker Nancy Pelosi, Senate Leader Chuck Schumer, and President Biden’s uncontrolled tax and spend schemes over the last two years have made America more expensive to live in, with less money in your paycheck after more hours worked. Biden’s America is one where you work twice as hard and get half the reward, which is what happens first in socialist countries, before everything is taken away by the government. Democrats are handing Republicans a messaging silver platter. Conservative leadership in government has always produced economic opportunity, growth, and stability in the markets. The Republican plans for free markets, low taxes, and less government can only be made real if Republicans embrace this vision of prosperity loudly, and deliver that message clearly and effectively to voters this fall.
Bob Carlstrom is President AMAC Action
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