Economists debate whether the US is in a recession
Kaltbaum Capital Management’s Gary Kaltbaum, former Obama Commerce Council Chairman Austan Goolsbee and Frances Newton Stacy, director of strategy at Optimal Capital, discuss the state of the US economy after a second quarter of negative GDP.
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The upcoming midterm election will feature a variety of issues, but the #1 focus for voters, which strategists and multiple polls say has the potential to sway Democratic candidates’ outcomes, is the economy.
Earlier this week, the Commerce Department said gross domestic product contracted 0.9% on an annualized basis in the three months from April to June. GDP also slumped for the second consecutive quarter, suggesting the economy has entered a recession.
To better understand how a recession could affect Democratic candidates in November’s midterm elections, or if they will at all, Fox News Digital contacted political experts from both sides of the aisle for their take.
THE US ECONOMY ENTERS A TECHNICAL RECESSION AFTER SECOND QUARTER GROWTH FALLED 0.9%
Economic data released Thursday showed two consecutive quarters of negative gross domestic product (GDP) growth, which has long been the yardstick used to determine whether the US is in a recession. (Fox News)
Jessica Tarlov, Democratic strategist and co-host of Fox News’ The Five:
“To be honest, I don’t think calling it a recession versus a contraction or anything else makes much of a difference. People know how they feel about the cost of gas, groceries, and goods and services. And the poll is clear: They don’t approve of how Biden has handled the economy and they don’t expect improvement.
“Against this backdrop, the verbal games of calling it a recession or not seem to miss the point, which is that Americans are struggling. What is interesting, however, is that the Democrats are consistently upvoting the general ballot, taking a small lead in the FiveThirtyEight average.
“It suggests that Republicans are not doing their job by making themselves a viable alternative to a Democratic party, which has been faltering in recent polls.” If they think they can win by yelling, ‘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, hEast of the Jason Rantz Show on AM 770 KTTH Radio:
“People are hurting and we’re being told it’s either no big deal or it’s not real. There is only so much lies we can endure before we exact political retaliation against the politicians responsible. Perhaps the Democrats could recover from the clear we are in a recession if they acknowledge the problem and offer a clear plan. But they refuse to admit the truth. How can we be sure they have a plan to fight recession and inflation when they won’t even admit it’s a problem?
“And how many more lies do you think we will accept? How stupid do you think the American people are?
“We see an open border, they tell us it’s closed. We see a man and we’re told it’s a woman. Months before the war in Ukraine we see high gas prices, we were told it was Putin’s fault. We were told that inflation was temporary, then it didn’t really exist, then it was good, then it was Putin’s fault, and now they just ignore it.
“Eventually all the dishonesty will catch up with them. I suspect that will be the case during the midterms.”
Jason Rantz, Host of The Jason Rantz Show on AM 770 KTTH Radio (Fox News Digital)
CERTAIN HOUSING MARKETS IN CALIFORNIA, IDAHO AND FLORIDA ARE THE HIGHEST APPLIED IN A RECESSION
Kevin Walling, Democratic campaign strategist and former Biden campaign deputy:
“It’s been 30 years since James Carville first uttered the words ‘It’s the economy, fool,’ during the 1992 election. This observation is as true today as it was then. The majority of Americans will go to the polls and vote in November. Democrats have a lot to campaign for, including record job growth and recovery, rapid wage growth, and more Americans than ever before having a quality job have healthcare.
“However, these gains are clearly not keeping pace with the high inflation we are all experiencing and Americans are suffering. Strengthening the global food supply and fighting price gouging at the pump. All of that effort, coupled with contrasting messages pointing to a near-universal GOP disability, could help turn the tide up and down in a difficult year for Team Blue.
Kevin Walling, Democratic campaign strategist and former Biden campaign deputy (Kevin Walling)
Peter Morici, economist and economics professor at the University of Maryland:
“If the economy goes into recession and inflation continues at an alarming rate, Democrats’ prospects of holding the Senate will plummet to near zero and their losses in the House of Representatives would be devastating.”
Peter Morici, economist and economics professor at the University of Maryland. (Peter Morici)
The commentary made available to Fox News Digital in this article is part of a new weekend series in which strategists from across the political spectrum will be asked the same questions about hot political issues and given the opportunity to offer their perspective.
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Economic output contracted in the first three months of the year, with GDP falling by 1.6%, the worst performance since spring 2020, when the economy was still in the clutches of the COVID-induced recession.
Recessions are defined as two consecutive quarters of negative economic growth and are characterized by high unemployment, low or negative GDP growth, falling incomes and declining retail sales, according to the National Bureau of Economic Research (NBER), which tracks downturns.
Fox Business’ Megan Henney contributed to this article.
Kyle Morris covers politics for Fox News. On Twitter: @RealKyleMorris.