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One of the hot button issues in the presidential debate will be the economy


We have some debate prep for you this morning. It is not for the candidates who appear in a TV studio tomorrow night. It is for the rest of us to make sense of what the candidates are likely to say. We had a briefing for you yesterday on immigration, and today, we have a memo on the economy. NPR chief economics correspondent Scott Horsley and NPR political correspondent Danielle Kurtzleben are both on the line. Good morning.



INSKEEP: OK, so I'm thinking about David Sacks, this tech entrepreneur who's now a Trump supporter, who put out this open letter, and he said, OK, we have an A B test, meaning that one guy had four years to influence the economy, then the other guy had four years to influence the economy - A, B, you have a test of each. And Scott, when you put the economies side by side, what do you see?

HORSLEY: Well, the first thing to say is that presidents always get more credit and blame for economic conditions than they should.


HORSLEY: But Trump had a pretty good track record during his first three years in office. His trade war did some damage. Exports suffered. But the economy did add 6.6 million jobs in those three years. Of course, then the pandemic hit, unemployment soared and Trump was the first president since Herbert Hoover to leave office with fewer jobs in the country than when he came in. Now, under Biden, the economy's added more than 15 million jobs. Unemployment has been at or below 4% for the last 2 1/2 years. It's a record that would be the envy of almost any president, but, of course, it's been marred by high inflation.

KURTZLEBEN: Right. And that high inflation is almost certainly the reason why we have poll after poll showing that a lot of Americans think that the Biden economy isn't so great. That - people have a negative economic outlook in some polls. I saw one that said people think the U.S. is in recession. Now, fact check, it is very much not. But according to the latest NPR/PBS News/Marist poll, a majority of Americans say Trump, rather than Biden, would better tackle the economy. That's 54 to 45%. Now, first of all, that includes a majority - a slim majority, but a majority of independents who Trump very much wants to win. It also includes one in six Democrats. Now one in six isn't a lot, but still, to have even one in six voters cross party lines to say the other guy might do something better, right now, that is very much not nothing.

INSKEEP: OK. Yeah. So inflation is real. There's also this perception of inflation that drives the overall perception of the economy. What is Biden's record in dealing with inflation?

HORSLEY: Well, inflation hit a four-decade high on Biden's watch in 2022. It has since then come down by about two-thirds, but prices are still elevated. The curious thing is Trump kind of gets a pass on pandemic job losses because voters say, hey, he didn't cause the pandemic. Voters don't give Biden the same kind of pass on inflation, even though it's also at least partly the byproduct of the pandemic and the war in Ukraine. I spoke earlier this week with Ellie Currens (ph) who lives outside Kansas City.

ELLIE CURRENS: Every time I go to the grocery store, everything's more expensive, which is a huge bummer because it's the essentials that I need - milk, eggs, bread. It's just hard. I work full time. My husband works full time. We try to have a life. We want to spend time with our daughter. We want to do the things we want to do, but, you know, I feel like at this point we're moving more towards survival mode rather than thriving.

HORSLEY: Grocery inflation has cooled off in the last year or so - prices are up only about 1% in the last 12 months, but people still feel like they're getting squeezed every time they go through the checkout line.

INSKEEP: Absolutely.

KURTZLEBEN: And while inflation is very much a day-to-day concern for a lot of people, there are a lot of voters who are thinking about longer term and bigger picture economic concerns. For example, here's Ruth Ann Aris (ph), she's 69. She's a retired Democrat from Pennsylvania. And here, she's thinking about her retirement.

RUTH ANN ARIS: Well, I know when Trump was in office it was sad, but my 401(k) was just going up and up and up. I mean, it was wonderful to watch it, but what's the trade off?

INSKEEP: OK, it is true that people's 401(k)s went up under Trump. Have they not gone up also under Biden ultimately?

KURTZLEBEN: They also have gone up under Biden. Stock indexes are up markedly under Biden, as well. Not quite as much as under Trump, but yes, that is true. But the big picture here is that what I'm curious about throughout this debate and the rest of the campaign season is the balance between those immediate grocery list economic concerns and also big, life-defining economic questions, like, can you afford an education, to retire, to have a kid, to own a home, and especially when you talk to younger voters, those concerns really come up.

INSKEEP: OK, so that's people's experience of the last few years. How would Trump be different as best you can tell?

HORSLEY: Well, some of Trump's policies would probably make inflation worse. He suggested a blanket 10% tariff, for example, American Action Forum, which is a conservative think tank, estimates that would cost the typical family up to $2,350 a year. Trump's call for mass deportations would also almost certainly drive up wages and prices, as well.

INSKEEP: OK, so if inflation is too high for people, and it's not clear how they would lower it further, what do the candidates propose that would, in some way, save people money?

KURTZLEBEN: Well, Trump has a couple of big ones that he likes to talk about. One is that he says he would drill, baby, drill in his administration to increase U.S. oil and gas production and thus lower gasoline prices. But it's not clear that that would work, because, for example, right now, U.S. crude oil production is at its highest level ever. Now, beyond that, he has floated some different populace proposals like this one that he mentioned in a recent speech in Las Vegas.


DONALD TRUMP: For those hotel workers and people that get tips, you're going to be very happy because when I get to office, we are going to not charge taxes on tips - people making tips.

INSKEEP: OK, sounds appealing.

KURTZLEBEN: Right. Yeah. But there are some big questions with that. A lot of tipped workers, for example, already don't make enough to pay income tax, so does this really help them? And also, does his proposal also apply to payroll taxes? Now, if so, it would presumably mean fewer Social Security payments and fewer benefits when people retire.

INSKEEP: Well, what about Biden?

KURTZLEBEN: Well, Biden has made a lot of proposals to save ordinary people money, and he's been systematic about it. He talks a lot on the campaign trail about cutting insulin prices for seniors. He also talked in the State of the Union about getting rid of junk fees, which are overdraft fees and that sort of thing that can add up on bank bill.


PRESIDENT JOE BIDEN: Junk fees may not matter to the very wealthy, but they matter to most other folks in homes like the one I grew up in, like many of you did. They add up to hundreds of dollars a month.

KURTZLEBEN: Now, Biden has a tough line to walk here. The economy is relatively strong. Inflation has cooled off a bit. But if you're Biden, do you really want to make the well, actually argument to voters that things are pretty good and you just don't get it, or do you lean into what you have done and plan to do? And he has to balance those things.

INSKEEP: One other thing to ask about - in a conventional presidential campaign, there'd be a lot of talk about overall tax rates. Somebody would be promising big income tax cuts, the other would be countering. What's happening here?

HORSLEY: Well, this is something the next Congress is going to have to tackle because a big chunk of the 2017 tax cuts expire at the end of next year. Biden wants to extend those tax cuts for people making under $400,000 while raising taxes on corporations and the wealthy. Trump wants to extend the tax cuts for everyone, and then cut taxes further.

INSKEEP: OK, that's NPRs Scott Horsley and Danielle Kurtzleben giving us some debate prep for tomorrow night's contest. Thanks to you both.

HORSLEY: Great to be with you.

KURTZLEBEN: Thanks, Steve. Transcript provided by NPR, Copyright NPR.

NPR transcripts are created on a rush deadline by an NPR contractor. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.

Steve Inskeep is a host of NPR's Morning Edition, as well as NPR's morning news podcast Up First.
Scott Horsley is NPR's Chief Economics Correspondent. He reports on ups and downs in the national economy as well as fault lines between booming and busting communities.
Danielle Kurtzleben is a political correspondent assigned to NPR's Washington Desk. She appears on NPR shows, writes for the web, and is a regular on The NPR Politics Podcast. She is covering the 2020 presidential election, with particular focuses on on economic policy and gender politics.