Your presidential debate prep on the US economy, in charts
Expect a lot of back and forth about the state of the US economy when President Joe Biden and former President Donald Trump face off Thursday in the first presidential debate. But what’s the real story? Experts from across the Atlantic Council compiled the figures and context you need to gauge the true health of the US economy—from unemployment to inflation to energy production—and how it compares with economic conditions in allied and rival countries around the globe.
The United States is outperforming all of its advanced economy peers in post-COVID growth, and it is not particularly close. As we’ll surely hear from Biden on Thursday, fiscal policy has played a role. The major infrastructure investments through the Inflation Reduction Act and CHIPS and Science Act, have started to create new jobs in the manufacturing sector. The Federal Reserve also played a key role by keeping interest rates near zero for twenty-two months and pumping trillions in liquidity and backstops into the US economy after the crisis. But there are other factors at play as well, including the rise of homegrown artificial intelligence companies and producers such as NVIDIA that make those machines hum, boosting the United States ahead of its fellow Group of Seven (G7) countries. Combined with increased productivity growth, you have the recipe for an unexpected surge in the US economy.
—Josh Lipsky is the senior director of the Atlantic Council’s GeoEconomics Center and a former adviser at the International Monetary Fund.
How does inflation in the United States compare to the G7? It’s falling, but not as fast as in Europe. The tradeoff with higher growth has been somewhat sticky inflation in the United States and a struggle to get back to the Fed’s 2 percent target range for price growth. It’s the surge in inflation during the pandemic and the still-elevated price levels that have generated so much discontent domestically about the US economy. Voters can’t feel that they may be doing better than citizens in Japan or Germany—what they can feel is how much it costs them to go to the grocery store this year compared to last.
—Josh Lipsky
One of the biggest points of contention during the debate will be about job creation. Biden will say Trump was the first president since Herbert Hoover to leave office with the United States having lost jobs during his presidency. If there’s one rule in US economic history, it’s to try not to be compared to Herbert Hoover. Of course, the reason for that fact was the COVID-19 pandemic. What’s most surprising, though, is what happened after. Unlike previous recoveries, the US labor market rebounded swiftly and within twenty-nine months had recovered all the jobs lost during the crisis. As of May 2024, over fifteen million jobs have been created during the Biden administration. The numbers are the numbers. The big debate that we will see play out Thursday is which factors drove which parts of the crash and recovery, and who gets the credit or blame.
—Josh Lipsky
One issue on which both sides of the aisle seem to agree is taking a strong stance on economic competition with China. The question of how strong will be up for debate, with Trump suggesting a 60 percent tariff on Chinese goods and Biden following a more targeted approach in his recent tariff increases on electric vehicles, steel, and other goods. Biden likely won’t mention that most of the Trump-era tariffs remain in place, and Trump won’t want to admit that the share of US imports coming from China is lower now than at any point in the last decade. Two of the driving forces—China’s economic slowdown and zero-COVID policies—probably won’t be part of the discussion. But they should be.
—Sophia Busch is an assistant director at the GeoEconomics Center.
The US economy continues to show declining emissions intensity of gross domestic product (GDP), meaning the amount of carbon emissions per unit of GDP. Crucially, the United States is cutting emissions while continuing to grow the economy. The Rhodium Group projects that emissions fell 1.9 percent even as the economy expanded by 2.4 percent in 2023. Accordingly, US emissions intensity of real GDP continues to decline even though the US economy is larger than it has ever been.
—Joseph Webster is a senior fellow at the Atlantic Council’s Global Energy Center.
US energy production stands at an all-time high because of the country’s higher output of oil, gas, and renewable energy sources such as solar and wind. Energy from oil production in 2023 rose by 5 percent compared to pre-COVID times in 2019, while natural gas output increased by 32 percent. Solar energy production has soared by a whopping 104 percent, as wind energy output grew by 44 percent. These developments have put pressure on coal output, which has fallen by 17 percent and is poised to decline further. Crucially, solar generation outpaced coal consumption for the first time in March 2024 in Texas, the country’s largest coal-consuming state. The US energy production mix is changing. Energy production—including for clean energy sources such as solar, wind, and nuclear energy—seems poised to surge if onerous permitting roadblocks, such as for siting transmission lines, are lifted.
—Joseph Webster
While the United States outperforms other G7 nations in economic growth, it falls behind in broader measures of well-being. Over the past decade, the United States has seen a decline on the Atlantic Council’s Prosperity Index, the only G7 country to experience a decline. More striking is the fact that even in the prosperity components in which the country has experienced improvements, such as education, these gains have been smaller than its peers’. As a result, the United States’ ranking has fallen in virtually all categories of the Prosperity Index since 1995. Yet this decline must be put in perspective, as the United States remains well established among the top countries on the Prosperity Index—ranking thirty-sixth out of 164 countries.
—Joseph Lemoine is the director of the Atlantic Council’s Freedom and Prosperity Center.
Life expectancy, an important health indicator, remains a challenge for the United States. Not only does it lag behind other G7 nations, but it also experienced the worst decline among G7 nations during the COVID-19 pandemic. Furthermore, the United States is one of only two G7 countries, alongside Germany, that hasn’t fully recovered from the pandemic’s impact on life expectancy.
—Joseph Lemoine
Income inequality has been a persistent problem in the United States for decades. While there might be temporary fluctuations, the overall trend shows minimal improvement. There has been some progress made in the last five years, but the United States remains worse off compared to 2010 when it comes to income inequality.
—Joseph Lemoine
Alisha Chhangani, Clara Falkenek, Gustavo Romero, and Konstantinos Mitsotakis of the GeoEconomics Center contributed to the data visualizations in this article.
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