After two years of punishing inflation, Americans lack confidence that the nation’s leaders in the White House, Federal Reserve and Treasury Department are doing the right thing for the economy, according to a Gallup survey released Tuesday.
Just 35% of those polled have a “great deal” or “fair amount” of confidence in President Joe Biden to do or recommend the right thing for the economy, the survey finds. Gallup said that nearly matches the low confidence rating for presidents — 34% for former President George W. Bush in 2008 during the Great Recession.
Even with the unemployment rate tumbling to historic lows, nearly half (48%) of Americans say they have almost no confidence in Biden on the economy.
Federal Reserve Chair Jerome Powell, a Republican first nominated by former President Donald Trump, doesn’t fare any better. Only 36% of Americans say they have confidence in Powell on the economy, a new low during Powell’s six-year tenure as Fed chief, while 28% say they have almost no confidence.
Gallup finds that just 37% of those polled say they have a great deal or fair amount of confidence in Treasury Secretary Janet Yellen.
Heading into a looming debt ceiling crisis, Congressional leaders also score low marks from the public. Just 34% of respondents say they have a great deal or fair amount of confidence in Democratic leaders in Congress, while 38% say the same of Republican leaders.
The poll, taken April 3 to April 25, demonstrates how the anxiety caused by high inflation continues to overshadow the nation’s surprisingly strong job market.
The economy added 253,000 jobs in April, dropping the unemployment rate to 3.4% — tied for the lowest since 1969. The Black unemployment rate has never been lower.
Yet inflation, which has cooled since the peak last summer, remains a central concern as consumers grapple with high prices at the grocery store, at the mall and when trying to buy a car.
“People are worried that inflation is not over, and will stay relatively high. And I think many people think that the politicians are oblivious,” said Greg Valliere, chief US policy strategist at AGF Investments. “There’s a feeling that Washington cannot grasp the inflation anxiety.”
The Powell-led Fed has faced criticism from both political parties, first for failing to initially address high inflation and now for reacting so aggressively that it risks tipping the economy into recession.
Last week, the Fed raised benchmark interest rates for the 10th consecutive meeting, bumping up benchmark rates to the highest level since late 2007.
“My colleagues and I understand the hardship that high inflation is causing, and we remain strongly committed to bringing inflation back down to our 2% goal,” Powell said during a press conference last week as he hinted at a potential pause to the rate hikes.
Billionaire investor David Rubenstein, the co-founder and co-chairman of The Carlyle Group, defended Powell’s track record as Fed chair.
“He’s done as good of a job as he could have. It wasn’t his fault $5 trillion was injected into the economy by the Trump and Biden administrations,” Rubenstein, who hired Powell a quarter century ago to work in private equity, told CNN on Monday. “It was almost inevitable you’d have some kind of inflation.”
The Fed’s war on inflation — the most aggressive series of rate increases since the early 1980s under then-Fed Chair Paul Volcker — is causing hardship, too.
Car loan rates have climbed to 13-year highs and credit card rates have never been higher. At the same time, economists warn the Fed’s rate hikes could slow the economy right into a recession.
“There’s a feeling that the Federal Reserve is deliberately trying to weaken the economy and boost unemployment. And the Fed has hurt the housing market,” said Valliere.
Gallup notes that confidence in leaders tends to rise and fall along with the fortunes of the economy.
“If the economy falls into a recession later this year, confidence in political leaders may erode further. However, if the economy improves and avoids a recession, Americans’ confidence may be restored,” Gallup said.