Deena Zaidi

Data and Financial Journalist

3 charts showing economic performance under each President

Posted on Author Deena ZaidiPosted in Politics & Policy, United States of America, World Economy

Both party nominees, Donald Trump and Kamala Harris made some interesting claims about the U.S. economy in their first televised Presidential debate.

  • The U.S. economy remains a heated topic during presidential debates and a top concern for American voters.
  • Eight in ten registered voters say it will be important to their vote in the 2024 presidential elections.

 I analyzed the data to check if these claims were true.

First things first: Unlike the stock market, the economic numbers are lagging indicators.

  • The incoming first-term U.S. President has little control over the economy he/she inherits.
  • Nevertheless, they still have a strong control over the policies, especially around trade, immigration and distributing the budget— keys to a thriving economy.
  • Unforeseen events, wars or even a pandemic can undermine the most well-planned regulations and policies.
  • Under a new presidential term, these events have spillover effects, making identifying the exact cause and effect difficult.

 By the numbers: To better understand the numbers, I focused on charting three key economic indicators under different Presidents.

  1. Inflation rate

In the recent debate, Trump claimed, “We have inflation like very few people have ever seen. Probably the worst in our nation’s history.”

Verdict: X False

  • The highest average inflation was historically high at 9.7% under Jimmy Carter (1977-1981) and the oil crisis in 1979 only worsened it, leading to high gas prices and shortages.
  • Carter also inherited a high inflationary period, with the overall average inflation already at 8.2% during Ford’s term (1974—1977).
  • Monthly inflation peaked at 9.1% in June 2022 under Biden but has dropped to 2.5%, for the year to August 2024.
  • Average inflation so far under Biden is at 5.2% (2021 until August 2024).

Note: High prices are not one party’s fault and more often, the cause of inflation isn’t black and white. The Federal Reserve seeks to keep inflation under 2% and maximum employment by adopting monetary and fiscal policies. 

2. Unemployment rate

Harris claimed, “Donald Trump left us the worst unemployment since the Great Depression”.

Verdict: X False

  • At the end of Trump’s term of office in January 2021, the unemployment rate was 6.4%.
  • However, in April 2020, unemployment peaked at 14.8% during the pandemic under Trump. Overall, his term saw an average unemployment rate of 5%.
  • However, it has fallen steadily since, with the most recent unemployment at 4.2% for August 2024, a huge drop from 6.4% in January 2024. 
  • Calculations show an average unemployment rate of 4.16% under President Biden (until August 2024)

3. Misery Index (inflation + unemployment)

Created in the 1970s by economist Arthur Okun, the Misery Index is often used to predict election outcomes.

  • It has correctly predicted 15 of the past 16 races for the White House, including every presidential matchup since 1980, as reported by CNBC.
  • Under the Trump administration, the misery index peaked during the pandemic, reaching 15% in April 2020.
  •  The current index in August sits at 6.8%, after a small dip in inflation.

Still, the misery index remains a lagging indicator and fails to capture real-time consumer sentiment and political polls.