Economists debate whether the US is in a recession
Kaltbaum Capital Management’s Gary Kaltbaum, former Obama economic council chair Austan Goolsbee and Optimal Capital Director of Strategy Frances Newton Stacy discuss the state of the U.S. economy following a second quarter of negative GDP.
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The upcoming midterm elections will feature a variety of issues, but the No. 1 focus for voters that has the potential to influence the outcome for Democratic candidates, according to strategists and multiple polls, is the economy.
Earlier this week, the Commerce Department said the gross domestic product shrank by 0.9% on an annualized basis in the three-month period from April through June. The GDP also tumbled for the second consecutive quarter, signaling that the economy has entered into a recession.
To better understand how a recession may impact Democratic candidates in November’s midterm elections, or whether it will at all, Fox News Digital contacted political experts from both sides of the aisle to get their assessment.
US ECONOMY ENTERS TECHNICAL RECESSION AFTER GROWTH TUMBLES 0.9% IN THE SECOND QUARTER
Economic data revealed Thursday showed two consecutive quarters of negative gross domestic product (GDP) growth, which has long been the measure that determines whether the U.S. is in a recession. (Fox News)
Jessica Tarlov, Democratic strategist and co-host of Fox News’ “The Five”:
“Truth be told, I don’t think calling it a recession versus a contraction or anything else makes that much of a difference. People know how they feel about the cost of gas, groceries and goods and services. And the polling is clear: They don’t approve of how Biden has handled the economy, and they don’t expect it to improve.
“Against that backdrop, the verbal games around calling it a recession or not seem to miss the point, which is that Americans are struggling. What is interesting, though, is that Democrats are polling better and better on the generic ballot, taking a small lead in the FiveThirtyEight average.
“That indicates that Republicans are not doing their job in making themselves a viable alternative to a Democratic Party that had been floundering in recent surveys. If they think they can win by screaming, ‘But we’re in a recession!,’ the GOP is wildly misreading the landscape.”
Democratic strategist and Fox News contributor Jessica Tarlov. (Fox News)
Jason Rantz, host of the Jason Rantz Show on AM 770 KTTH Radio:
“People are hurting, and we’re being told it’s either not a big deal or it’s not real. We can only take so much lying before we level political retribution against those politicians who are responsible. Maybe Democrats would be able to recover from the clear recession that we’re in if they acknowledged the problem and offered a clear plan. But they refuse to admit the truth. How can we be confident they have a plan to combat the recession and inflation if they won’t even admit it’s a problem?
“And how much more lying do they think we will accept? How stupid do they think the American people are?
“We see an open border, they tell us it’s closed. We see a male, and were told it’s a female. We see high gas prices months before the war in Ukraine, we’re told it’s Putin’s fault. We were told inflation is transitory, then it didn’t really exist, then it was a good thing, then it was Putin‘s fault. And now they just ignore it.
“At some point, all of the dishonesty is going to catch up to them. I suspect that time will be during the midterms.”
Jason Rantz, host of the Jason Rantz Show on AM 770 KTTH Radio (Fox News Digital)
CERTAIN CALIFORNIA, IDAHO, FLORIDA HOUSING MARKETS MOST SUSCEPTIBLE TO DOWNTURN IN A RECESSION
Kevin Walling, Democratic campaign strategist and former Biden campaign surrogate:
“It’s been 30 years since James Carville first uttered the words, ‘It’s the economy, stupid,’ during the 1992 election. The observation is as true today as it was then. The majority of Americans will go to the polls in November and vote with their pocketbooks foremost in mind. Democrats have a lot to campaign on, including record job growth and recovery, rapid wage growth and more Americans having quality health care coverage than ever before.
“Those gains are clearly not keeping up with the high inflation we’re all experiencing, however, and Americans are hurting. Democrats must be seen as the party of action when it comes to combating rising prices by passing the Inflation Reduction Act of 2022, strengthening the global food supply and taking on price-gouging at the pump. All of those efforts, coupled with contrasting messaging highlighting near-universal GOP obstruction, could help stem the tide up and down the ballot in a tough year for Team Blue.”
Kevin Walling, Democratic campaign strategist and former Biden campaign surrogate (Kevin Walling)
Peter Morici, economist and business professor at the University of Maryland:
“If the economy falls into recession and inflation continues at an alarming pace, the Democrats’ prospects for holding the Senate fall to almost zero, and their losses in the House would be devastating.”
Peter Morici, economist and business professor at the University of Maryland. (Peter Morici)
The comments provided to Fox News Digital in this article are part of a new weekend series in which strategists from across the political spectrum are asked the same questions related to political hot topics and are provided with an opportunity to offer their perspective.
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Economic output fell over the first three months of the year, with GDP tumbling 1.6%, the worst performance since the spring of 2020, when the economy was still deep in the throes of the COVID-induced recession.
Recessions are defined by two consecutive quarters of negative economic growth and are characterized by high unemployment, low or negative GDP growth, falling income and slowing retail sales, according to the National Bureau of Economic Research (NBER), which tracks downturns.
Fox Business’ Megan Henney contributed to this article.
