Minorities Critical Of ‘Bidenomics’ As Incomes Fall

In a recent report, the Federal Reserve unveiled a snapshot of the financial landscape in the United States, highlighting both gains and losses. The central bank’s Survey of Consumer Finances (SCF) delved into the dynamics of household wealth and income from 2019 to 2022, shedding light on how the nation fared during this period.

According to the SCF, the real (inflation-adjusted) net worth of the typical U.S. household surged by an impressive 37% between 2019 and 2022. This growth was attributed to rising home prices, the appreciation of stock holdings, and government stimulus measures. However, a deeper look into the data reveals that these gains were not evenly distributed.

White families experienced a 1.3% increase in income, whereas Black and Hispanic families faced declines of 1.6% and 1.1%, respectively. Furthermore, wages for all Americans failed to keep pace with inflation, contributing to concerns about economic stability.

The report also noted that while housing played a pivotal role in boosting net worth, it is an illiquid asset, making it less useful for covering day-to-day expenses. Liquid wealth, encompassing assets like cash, checking, and savings accounts, didn’t see significant growth for minority families, and actually decreased for Black households.

The study acknowledged that minority households benefited more from “crisis-era” stimulus and relief efforts, which included measures like stimulus checks and enhanced food stamps. However, with most of these programs now expired, families across the nation are grappling with above-average inflation, diminishing their purchasing power.

Since the onset of the pandemic, consumers have seen their purchasing power decrease by 16%, creating widespread economic uncertainty. Families, across all ethnicities, reported increasing uncertainty about their future income, with Black and Hispanic families experiencing more significant rises in this regard.

Turning to the political landscape, President Joe Biden has been promoting his economic vision, known as “Bidenomics.” He spoke of investments in tech hubs and clean-energy jobs, emphasizing their role in revitalizing communities. However, according to a Morning Consult report, a majority of swing-state voters do not share the same optimism.

Many believe that their financial situations were better under former President Donald Trump and expressed mistrust in “Bidenomics.” Left-leaning economist James Galbraith noted that it would be challenging to persuade struggling Americans that the economy is thriving under the current administration.