This year’s tight presidential race will likely hinge on voters’ assessments of the economy, immigration, and a few other key elements of life in America during President Biden’s first term in office. The first presidential debate on June 27, when Biden spars with Republican challenger Donald Trump, will undoubtedly showcase these issues.
Yet many voters misconstrue the power of the presidency, giving the nation’s top elected official more credit than he deserves on crucial matters. The buck stops in the Oval Office, so presidential reputations and reelection bids depend in large measure on random events that occur during those four-year periods of time. Any president, however, is as likely to be a victim of circumstances as he is the master of them.
Here are three myths about the president playing out this year, as they have in prior elections:
The president controls the economy
Probably more than anything else, voters hold the president responsible for their livelihood, their job security, and their ability to get ahead. Yet the American president has remarkably little control over the US economy, even though he holds the most important job in the world. The economy is an almost unfathomably large and complex organism that defies taming, by the president or by anybody else. Presidents normally take credit when the economy is going strong, but that’s an illusion of control that blows up when the economy goes south and voters need somebody to blame.
Biden claims credit for record job growth during his term, while largely blaming high inflation on other factors. He’s wrong about job growth and right about inflation. Employers have added a record 16 million jobs under Biden because of massive amounts of fiscal and monetary stimulus during the COVID pandemic, buoyant consumers willing to keep spending, and a generally good business environment in the United States. Biden infrastructure programs or other policy measures may have added a few jobs here and there — but not 16 million.
Inflation that peaked at 9% in 2022 had many of the same causes, including COVID-era distortions in supply and demand, supply-chain snafus, and all that stimulus, which stuffed money into people’s pockets and goosed spending through the end of 2023. Biden critics dub the phenomenon “Bidenflation,” as if Biden did something terrible to send prices soaring. But Biden only signed one of the four major stimulus bills, accounting for about one-third of all the COVID-related fiscal stimulus. Trump signed the other three. If Trump had won in 2020 instead of Biden, job growth probably would have been just as solid, and inflation just as nettlesome.
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There’s one organization that does exert considerable control over the US economy: the Federal Reserve, which moves interest rates up or down and pulls other levers to control credit, demand, and economic growth. Yet even the Fed ends up outgunned sometimes, as it did with runaway inflation in 2022 and 2023. Sometime the economy simply won't do what anybody wants.
The president controls the rest of the world
With wars raging in Eastern Europe and the Middle East, Biden critics charge that weak leadership in the United States has led to chaos thousands of miles away. This is absurd. Americans tend to think the world revolves around Washington, D.C., when in reality foreign leaders often make decisions with no regard for what Americans think or do.
Republicans, for instance, have argued that Russian President Vladimir Putin invaded Ukraine in 2022 because Biden wasn't tough enough in threatening consequences. Yet the actual consequences include the destruction of more than half of Russia's army in eastern Ukraine, in large measure because the Biden administration is the lead nation providing military aid to Ukraine. Maybe Putin had other reasons— such as high oil prices in 2022 that fattened Putin's war chest with revenue from oil and gas exports.
Armchair geostrategists also describe the war between Israel and Hamas as if it’s Biden’s war to win or lose, even though the United States has no combat troops involved and no turf at stake. Israel has been at war with its Arab neighbors on and off since its founding in 1948. The United States provides billions of dollars of military aid to Israel each year, but that has never come with a magic wand the US president can wave to end conflicts.
The president controls energy prices (or should)
During Donald Trump’s presidency, gasoline prices averaged $2.57 per gallon. Under Biden, gas has averaged $3.67. Trump loves fossil fuels and wants to “drill baby drill,” while Biden wants to replace fossil fuels with green energy. So Biden deliberately made gas more expensive, right?
Sorry, no. Gas was cheaper under Trump because US shale producers were in a market share battle with the OPEC+ drilling nations and everybody was overproducing. That created excess supply and drove prices for oil and related energy products to unusually low levels. When COVID hit in 2020 and travel stopped, oil prices cratered and producers lost billions.
Since then, both domestic and global oil producers have been far more conservative. The OPEC+ nations are producing less now than they were in 2019 to keep prices up. American drillers and their investors are far more committed now to making profits than to gaining market share. US oil production has hit new record highs under Biden because American producers can make good money with prices around $80 per barrel, as they have been. But even record US production doesn’t completely make up for the OPEC cuts, which are keeping global supplies fairly tight.
There are a lot of things the American president does control, such as trade policy, regulation, federal law enforcement, foreign relations with allies and adversaries, and military interventions. On issues requiring Congressional action, the president can generate momentum behind favored legislation or use his veto power to block bills he opposes. That will leave plenty for the next president to focus on, while the economy does whatever it chooses.
Rick Newman is a senior columnist for Yahoo Finance. Follow him on Twitter at @rickjnewman.
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