All that's left is for President-elect Donald Trump to put his name on it — if he wants.
Trump won the White House in large part because of voters' frustration with high prices and a sense that the United States needs major changes. But when he enters office in January, Trump will inherit an economy primed for growth.
The unemployment rate is low, inflation is easing and President Joe Biden's administration has teed-up a ready-made list of infrastructure projects that could go from theoretical to reality over the next several years. There’s the TSMC computer chip plant in Arizona, the new Hyundai electric vehicle factory in Georgia and a modernized I-375 in Michigan, among thousands of projects under way that will take years to complete.
All of that means it could be Trump, rather than Biden, who gets to tell Americans that he built the country back better. If he decides to let the projects proceed, that is.
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Biden, himself, acknowledged last week that the positive economic impacts from his policies would occur after his term ends in January.
“Much of the work we’ve done is already being felt by the American people, but the vast majority will not be felt, will be felt over the next 10 years,” he said in remarks in the Rose Garden. “It’s going to take time, but it’s there. The road ahead is clear.”
Trump wants to reverse Biden's policies, but construction is already ongoing
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While Trump on the campaign trail railed against Biden's record, he has offered few details on what initiatives he might scrap. Trump said in September that he would “rescind all unspent funds under the misnamed Inflation Reduction Act” and said on Joe Rogan’s podcast that tariffs would do more for manufacturing than the funding provided by the CHIPS and Science Act.
But Biden aides privately told The Associated Press that they expect Trump to continue the planned projects and take credit for Biden's accomplishments, just like the Republicans in Congress who’ve celebrated plant openings and infrastructure developments in their districts but voted against them.
The administration has spent millions of dollars to put up road signs to promote Biden's role in the projects; all Trump would need to do is re-label them with his own name. Biden aides feel confident that Trump won’t want to cut programs that are helping states he won in this year’s election even if Republicans try for a token repeal of some provisions in order to help fund some of their own tax cut plans.
When asked about this possibility, Karoline Leavitt, spokeswoman for the Trump-Vance transition, said: “The American people re-elected President Trump by a resounding margin giving him a mandate to implement the promises he made on the campaign trail. He will deliver.”
Natalie Quillian, a deputy chief of staff for Biden's White House, said that the administration's programs are already starting to make a positive difference for the economy.
“We have already announced investments for 70,000 infrastructure and clean energy projects, catalyzed nearly $1 trillion in private sector investment, lowered prescription drug prices, and created 1.6 million construction and manufacturing jobs,” she said. "Over the coming months, we will continue to run through the tape and ensure Americans benefit from this president’s agenda for years to come.”
Trump is entering the White House as the economy is improving
Trump is also inheriting by many measures an increasingly healthy economy, despite his claims that conditions are miserable.
The Republican won the election with the unemployment rate at a healthy 4.1%, inflation at 2.4% and the Federal Reserve cutting its benchmark rates in ways that could support additional growth. Federal Reserve Chair Jerome Powell summarized the situation last week by saying the economy is “strong overall.”
Voters, though, felt the economy was weak. They penalized Democrats for inflation that reflected supply chain challenges after the pandemic, the impact of government aid that also energized job growth and Russia’s 2022 invasion of Ukraine causing spikes in energy and food prices.
Voters appeared to care less about the overall rate of inflation, though, than the changes in price levels that occurred over the past four years. Nearly 9 in 10 identified inflation as an important factor for their choice in this year’s election, with Trump winning the clear majority of this group, according to AP VoteCast, an extensive survey of more than 120,000 voters.
Still, economists who’ve advised and worked previously with Trump felt the economy was not as solid as the top line numbers suggest. They stressed the high level of government debt that has been driving growth, even though Trump himself showed little appetite for cutting deficits during his previous time in the White House.
“Government spending is keeping the economy afloat," said Joseph LaVorgna, who was the chief economist of White House National Economic Council during Trump’s presidency.
LaVorgna also noted that much of the recent job growth has come from government and health care hiring, instead of from manufacturing and other for-profit sectors.
Possible pressure to embrace renewable energy and EVs
There is a recognition among some Republican lawmakers that the energy tax credits that were part of the Inflation Reduction Act were positives and should be preserved. Eighteen GOP House members sent House Speaker Mike Johnson a letter in August asking him to preserve the tax credits.
Economists supporting Trump also note that sales growth for EVs could jump under the incoming administration, which has the support of Tesla CEO Elon Musk.
Trump has wanted to remove Biden's incentives for EVs, which are part of the Inflation Reduction Act. But after getting Musk's backing, Trump said that he's "for electric cars ... because Elon endorsed me very strongly.”
That simple shift of Trump talking up EVs could remove politics from the issue and cause the incoming president to fulfill 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 EV industry will make a comeback,” Moore said. “Biden made EVs toxic because half the country hated Biden, half loved him. The people who hated Biden wouldn’t buy an EV out of conscience.”
