Economist Paul Krugman: The US economy is on the right track — yet many Americans feel 'pessimistic'

On Friday, November 5, the U.S. Department of Labor released its latest economic figures — reporting that unemployment in the United States fell to 4.6% in October and that wages had increased by 4.9% from what they were a year ago. Liberal economist Paul Krugman, who has often praised President Joe Biden's economic policies and his Build Back Better agenda, is bullish and optimistic about the state of the U.S. economy in his November 9 column for the New York Times. But Krugman also points out that many Americans are feeling "pessimistic" about the economy and addresses the reasons for their concerns.

"By the usual measures," Krugman observes, "the U.S. economy has been booming this year. Employment has risen by more than five million since January. A record number of Americans say this is a good time to find a quality job — a sentiment reflected in the willingness of an unprecedented number of workers to quit. Yes, high quit rates are a good sign. Yet Americans are, or say they are, pessimistic about the economic situation."

Krugman goes on to say that while Americans' economic concerns, including "inflation," are certainly valid, it is important to look at the big picture.

The economist/Times columnist explains, "How can people be feeling so bad about a seemingly good economy? One answer is that Americans are upset about inflation and disrupted supply chains. And that's surely true. But I'd suggest that it's only part of the story — that to an important extent, when you ask people about the state of the economy, their replies don't necessarily reflect their actual experience. Instead, they respond based on what they imagine is happening to other people — a perception that can be shaped by news reports and their own political leanings."

Krugman adds that although "inflation is indeed high by recent standards and supply-chain issues are real," right-wing media outlets have been exaggerating those problems.

"Some news organizations have been doing all they can to convey the impression of a troubled economy, whatever the reality," Krugman notes. "As I suggested, while supply-chain issues are real, their impact is often overstated; empty shelves are actually fairly rare. That, presumably, is why Fox News and Newsmax have been running segments about the Biden economy featuring photos of empty shelves that were taken last year or in other countries."

Economically, the COVID-19 pandemic and the recession it triggered have been brutal for millions of Americans, especially those who need to be physically present in brick-and-mortar businesses and don't have the option of being able to work from home. And all the MAGA Republicans who engaged in coronavirus denial, discouraged social distancing measures and the use of protective face masks, and promoted anti-vaxxer lies only made matters worse.

Krugman stresses that in the months to come, the Biden Administration will need to brag about its economic policies, be really aggressive about it, and convince more Americans that the U.S. is on the right track economically.

"The economy is likely to get considerably better over the months ahead as the pandemic subsides and snarls in the supply chain get worked out," Krugman predicts. "But there is no guarantee that the American public will even notice these gains. If the Biden Administration wants to turn perceptions around, an objectively good economy won't be enough; the good news will have to be sold, hard."