Is Joe Biden really the new Jimmy Carter?

FLORENCE — It has become fashionable of late to compare US President Joe Biden in 2023 to Jimmy Carter in 1979. Just as the events of 1979 doomed Carter’s relection hopes the following year, developments in 2023 are said to have effectively sunk Biden’s bid for a second term in November.

Most obviously, both Carter and Biden confronted a demoralising inflation problem. But Carter-era inflation was far worse: in November 1979, a year prior to the election, consumer price inflation in the United States was running at 12.6 per cent. In the 12 months ending in November 2023, in contrast, CPI inflation was a modest 3.1 per cent. But inflation does remain a political liability for Biden, regardless of whether the phenomenon is now largely in the rearview mirror.

Second, Biden, like Carter before him, has given the Federal Reserve free rein to tackle the problem. Carter selected Paul Volcker to chair the US Federal Reserve Board largely for Volcker’s inflation-fighting credentials, in full knowledge that the new chair would jack up interest rates. Despite warnings from his political adviser, Bert Lance, that Volcker’s appointment would doom the president’s relection prospects, Carter then let Volcker go about his business. Carter’s hands-off approach during the run-up to an election was quite different from that of some of his predecessors, in particular Richard Nixon before the 1972 election.

Biden has similarly allowed Jerome Powell’s Fed to adjust interest rates as it chooses, ignoring howls of pain from homebuyers and others. And, again, Biden’s unwillingness to criticize the Fed is diametrically opposed to the stance taken by his predecessor, Donald Trump.

Then there are the two presidents’ problems on the foreign-policy front, in general and with respect to Iran in particular. In November 1979, student demonstrators stormed the US embassy in Tehran, taking 66 Americans hostage. Soon thereafter, Ayatollah Ruhollah Khomeini returned from exile in Paris, and his characterisation of the US as “the Great Satan” has informed the Iranian government’s rhetoric and policy ever since.

The hostages were released minutes after Ronald Reagan’s inauguration in January 1981. The failure of Carter’s effort to rescue them the previous April had become an open political wound in the run-up to the election and a symbol of a failed foreign policy.

The Biden administration’s inability to engineer an extended ceasefire [in Gaza] or otherwise aid in freeing the captives creates a similar sense of impotence.

Meanwhile, US-backed Ukrainian forces’ failure to gain much ground against their Russian adversaries in their 2023 summer offensive, and the failure of US sanctions to deter aggression by Russia, heighten the sense that American foreign policy is in disarray.

All this has translated into dismal approval ratings for Biden, worse even than Carter’s in 1979. Thus, the comparison would be suggestive even if we had not just been reminded that none other than the young Biden, then a US senator, expressed doubts in the run-up to the 1980 election that it would serve the incumbent or the Democratic Party for Carter to seek a second term.

In addition to parallels, however, there is also an important difference between Biden and Carter, namely in their political positioning. Carter worried about Americans’ anxious mental state and the outlook for the country. In July 1979, he delivered what came to be known as the “Malaise Speech”. He decried Americans’ crisis of confidence and lamented “growing doubt about the meaning of our own lives” and “loss of a unity of purpose for our nation”. Americans, Carter went on, were losing faith “not only in government itself but in the ability as citizens to serve as the ultimate rulers and shapers of our democracy”. Sound familiar?

In fact, the speech was not entirely negative. But it came to be portrayed that way, specifically by Reagan, who portrayed himself as a “happy warrior”, famously asserting at the conclusion of his election eve address, “I find no national malaise.” It was a winning bet on an optimistic message. In the dark days of 1979-80, American voters preferred Reagan’s sunny confidence to Carter’s dour rumination.

Now, of course, it is the incumbent, Biden, who is the optimist, insisting that America is on the right track, while the likely challenger, Trump, claims that America is suffering from a deep-seated malaise, rages about retribution and sees threats at every turn. History suggests that American voters prefer optimism. But it also suggests that they are full of surprises.

Barry Eichengreen, professor of Economics and Political Science at the University of California, Berkeley, is the author, most recently, of In “Defence of Public Debt” (Oxford University Press, 2021). Copyright: Project Syndicate, 2024.

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