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 a 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.