WASHINGTON (AP) — All that’s left now is for President-elect Donald Trump to put his name on it — if he wants.
Trump won the White House largely because voters were frustrated by high prices and felt the United States needed massive changes. But when he takes office in January, Trump will inherit an economy poised for growth.
The unemployment rate is low, inflation is easing and President Joe Biden’s administration has put together a ready list of infrastructure projects that could go from theory to reality in the next few years. Among the thousands of ongoing projects that will take years to complete are TSMC’s computer chip plant in Arizona, Hyundai’s new electric vehicle factory in Georgia and an upgraded I-375 in Michigan.
All of this means that it may be Trump, not Biden, who can tell Americans that he has built the country back better. That is, if he decides to let the projects continue.
Biden himself admitted last week that the positive economic impact of his policies would come after his term ends in January.
“Much of the work we have done is already being felt by the American people, but the vast majority will not feel it until the next decade,” he said in a speech in the Rose Garden. “It will take some time, but it is there. The path ahead is clear.”
Trump wants to reverse Biden’s policies, but construction is already underway
While Trump railed against Biden’s record on the campaign trail, he gave few details about what initiatives he might abandon. Trump said in September that he would “withdraw all unspent funds under the bill misnamed the Inflation Reduction Act” and said on Joe Rogan’s podcast that tariffs would do more for manufacturing than those provided by the CHIPS and Science Act Medium.
But Biden aides privately told the Associated Press that they expect Trump to move forward with planned projects and recognize Biden’s accomplishments, just like Republicans in Congress who celebrated but voted against plant openings and infrastructure developments in their districts.
The government has spent millions of dollars installing road signs to publicize Biden’s role in the projects; All Trump would have to do is rename it with his own name. Biden advisers are confident Trump will not want to cut programs that assist states he won in this year’s election, even as Republicans seek to symbolically repeal some provisions to fund some of their own tax cut plans.
When asked about that possibility, Karoline Leavitt, spokeswoman for the Trump-Vance transition, said: “The American people overwhelmingly re-elected President Trump and gave him a mandate to follow through on the promises he made during the campaign.” He will deliver .”
Natalie Quillian, deputy chief of staff in the Biden White House, said the administration’s programs are already starting to have a positive impact on the economy.
“We have already announced investments for 70,000 infrastructure and clean energy projects, unlocked nearly $1 trillion in private sector investment, reduced prescription drug prices and created 1.6 million construction and manufacturing jobs,” she said. “In the coming months, we will continue to review the tape and ensure that Americans benefit from this President’s agenda for years to come.”
Trump enters the White House as the economy recovers
Trump is also inheriting an increasingly robust economy in many respects, although he claims conditions are miserable.
The Republican won the election with unemployment at a whopping 4.1%, inflation at 2.4% and the Federal Reserve cutting interest rates in a way that could spur additional growth. Federal Reserve Chairman Jerome Powell summed up the situation last week by saying the economy was “strong overall.”
However, voters felt the economy was delicate. They punished Democrats for inflation stemming from post-pandemic supply chain challenges, the impact of government aid that also boosted job growth, and Russia’s invasion of Ukraine in 2022, which led to a surge in energy and food prices.
However, voters seemed to care less about the overall inflation rate and more about the changes in price levels that have taken place over the last four years. According to AP VoteCast, a comprehensive survey of more than 120,000 voters, nearly 9 in 10 cited inflation as an significant factor in their vote in this year’s election, with Trump winning the clear majority of that group.
Still, economists who had previously advised and worked with Trump said the economy was not as solid as the numbers suggested. They highlighted the high level of national debt driving growth, even though Trump himself had shown little interest in deficit reduction during his previous time in the White House.
“Government spending keeps the economy afloat,” said Joseph LaVorgna, who was chief economist at the White House National Economic Council during Trump’s presidency.
LaVorgna also noted that much of the recent job growth has come from hiring in government and health care, rather than manufacturing and other for-profit sectors.
Possible pressure to utilize renewable energy and electric vehicles
Some Republican lawmakers agree that the energy tax credits that were part of the Inflation Reduction Act were positive and should be retained. Eighteen Republican members of the House of Representatives sent House Speaker Mike Johnson a letter in August urging him to keep the tax credits in place.
Economists who support Trump also note that electric vehicle sales growth could skyrocket under the new administration backed by Tesla CEO Elon Musk.
Trump wanted to eliminate Biden’s electric vehicle incentives, which are part of the Inflation Reduction Act. But after receiving Musk’s endorsement, Trump said he was “for electric cars… because Elon has supported me very strongly.”
This uncomplicated shift, with Trump talking about electric vehicles, could remove politics from the issue and lead to the new president meeting a goal set by Biden, said economist Stephen Moore, an informal Trump adviser and economist at the Heritage Foundation , a conservative think tank.
“With Biden gone, the electric vehicle industry will make a comeback,” Moore said. “Biden made electric vehicles toxic because half the country hated Biden, the other half loved him. The people who hated Biden would not buy an electric vehicle out of conscience.”
