eichengreen186_Bettmann  Contributor_biden carter Bettmann / Contributor

Is Joe Biden Really the New Jimmy Carter?

The incumbent US president is increasingly being compared to the last Democrat to lose his re-election bid. But, beyond the obvious parallels – both confronted popularity-sapping challenges from inflation and foreign-policy disasters – lies a key difference.

FLORENCE – It has become fashionable of late to compare US President Joe Biden in 2023 to Jimmy Carter in 1979. Just as the events of 1979 doomed Carter’s re-election hopes the following year, developments in 2023 are said to have effectively sunk Biden’s bid for a second term in November.

Most obviously, both Carter and Biden confronted a demoralizing inflation problem. But Carter-era inflation was far worse: in November 1979, a year prior to the election, consumer price inflation in the United States was running at 12.6%. In the 12 months ending in November 2023, in contrast, CPI inflation was a modest 3.1%. But inflation does remain a political liability for Biden, regardless of whether the phenomenon is now largely in the rearview mirror.

Second, Biden, like Carter before him, has given the Federal Reserve free rein to tackle the problem. Carter selected Paul Volcker to chair the US Federal Reserve Board largely for Volcker’s inflation-fighting credentials, in full knowledge that the new chair would jack up interest rates. Despite warnings from his political adviser, Bert Lance, that Volcker’s appointment would doom the president’s re-election prospects, Carter then let Volcker go about his business. Carter’s hands-off approach during the run-up to an election was quite different from that of some of his predecessors, in particular Richard Nixon before the 1972 election.