President Biden is set to leave his successor, Donald Trump, a strong economy marked by several key achievements. Despite significant challenges such as the pandemic, inflation, and geopolitical tensions, Biden’s administration has overseen steady economic growth, job creation, and investment in critical sectors. However, the stability of this economic foundation depends on policy decisions moving forward, and there are ways it could be undermined.
Under Biden, unemployment reached historic lows, hovering around 3.5%, as millions of jobs were added in various sectors. Investments in infrastructure, clean energy, and semiconductor manufacturing have created a framework for sustainable economic growth. Programs like the CHIPS Act encouraged domestic production of critical technologies, reducing reliance on foreign supply chains. The Inflation Reduction Act also supported clean energy industries, making the U.S. a leader in the global green transition.
Consumer spending has remained strong, and wages have risen, particularly for lower-income workers, due to a combination of market pressures and policy interventions like raising the federal minimum wage for contractors. Inflation, which peaked during the pandemic recovery, has largely been brought under control, with prices stabilizing across many categories. There is still work to be done in this area, especially in the food industry.
However, there are risks to this progress, particularly if certain policy decisions or fiscal mismanagement occur under the next administration. The six things Trump should avoid if he doesn’t want to derail the current economies trajectory are:
- Rolling Back Investments in Key Industries
If Trump or any future administration reverses the investments in clean energy and semiconductor production, the U.S. could lose its competitive edge. Dismantling these programs might create short-term savings but would weaken the economy’s long-term resilience and growth potential.
- Reckless Tax Cuts
Trump’s first term saw significant tax cuts, primarily benefiting corporations and the wealthy. A repeat of this strategy could balloon the federal deficit, which Biden’s administration worked to reduce. Increased deficits can lead to higher interest rates, making borrowing more expensive for businesses and consumers.
- Trade Wars and Protectionism
The trade wars initiated during Trump’s first term disrupted global supply chains and increased costs for American businesses and consumers. Returning to aggressive tariff policies could negate the benefits of Biden’s trade agreements and weaken international partnerships.
- Undermining Social Safety Nets
Cutting programs like Social Security, Medicare, or Medicaid could destabilize the economy, especially as these programs support millions of Americans. Weakening these safety nets would not only harm individuals but also reduce overall consumer spending.
- Neglecting Climate Action
Biden’s administration has positioned the U.S. as a leader in combating climate change, which is increasingly tied to economic stability. Ignoring climate policies could lead to higher disaster costs and lost opportunities in emerging industries like renewable energy and electric vehicles.
- Regulatory Rollbacks
Overzealous deregulation, particularly in the financial sector, could lead to instability similar to what occurred during the 2008 financial crisis. Biden’s policies have sought a balance between growth and oversight; removing these safeguards could expose the economy to unnecessary risks.
President Biden is leaving an economy with solid fundamentals, built on policies aimed at long-term stability. How this foundation is managed will determine whether it continues to thrive or faces setbacks. By prioritizing short-term gains over sustainable growth, the incoming administration could undo many of these achievements, putting the U.S. on a precarious economic path. The choices made in the next term will be critical to maintaining the progress made under Biden’s leadership.
