There’s a striking disconnect between the widely shared pessimism among Americans and measures that show the economy is actually robust. Consumers are spending briskly—behavior that suggests optimism, not retrenchment. Inflation has tempered. Unemployment has been below 4% for 24 straight months, the longest such stretch since the 1960s.
The disconnect has puzzled economists, investors and business owners. But press Americans harder, and the immediate economy emerges as only one factor in the gloomy outlook. Americans feel sour about the economy, many say, because their long-term financial security feels fragile and vulnerable to wide-ranging social and political threats.
Reliable steps up the economic ladder, such as a college degree, no longer look like a good investment. War overseas, and an emboldened set of hostile nations, have made the world feel dangerous. Uninspiring leaders at home, running a government widely seen as dysfunctional, have left people without hope that America is up to the challenge of fixing its problems.
The broad reasons for America’s dim outlook suggest that even further improvement in the economy might not be enough to lift the nation’s mood. In an election year, that is shaping up as one of President Biden’s biggest impediments to winning a second term. He has received little credit so far for an economy that has foiled predictions of a recession and instead grew 3.1% in the past year, far ahead of the pace in 2022.
Inside the disconnect between gloomy Americans and a robust economy. “There’s a sense it could all go away in a second.” https://t.co/SUUx0JqudF https://t.co/SUUx0JqudF
— The Wall Street Journal (@WSJ) February 7, 2024