Ex-Clinton comptroller says ‘voters were right’ about bad Biden economy, government numbers were ‘wrong’
Financial advisor Eugene Ludwig said voters were right and Democrats were wrong about the state of the economy leading up to the election in an article Tuesday.
“Before the presidential election, many Democrats were puzzled by the seeming disconnect between ‘economic reality’ as reflected in various government statistics and the public’s perceptions of the economy on the ground,” Ludwig wrote in a Politico piece titled, “Voters Were Right About the Economy. The Data Was Wrong.”
“Many in Washington bristled at the public’s failure to register how strong the economy really was. They charged that right-wing echo chambers were conning voters into believing entirely preposterous narratives about America’s decline,” he said.
“What they rarely considered was whether something else might be responsible for the disconnect — whether, for instance, government statistics were fundamentally flawed.”
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Ludwig previously served as the former U.S. Comptroller of the Currency under President Bill Clinton, part of an independent bureau in the Department of the Treasury.
Eugene Ludwig criticized Democrats touting a great economy during the Biden administration despite voter pessimism. (REUTERS/Elizabeth Frantz)
After his move to the private sector, he became “increasingly skeptical that the government’s measurements properly capture the realities defining unemployment, wage growth and the strength of the economy as a whole.”
Through research under his organization, the Ludwig Institute for Shared Economic Prosperity, he found “for 20 years or more, including the months prior to the election, voter perception was more reflective of reality than the incumbent statistics.”
“Democrats, on the whole, seemed much more inclined to believe what the economic indicators reported. Republicans, by contrast, seemed more inclined to believe what they were seeing with their own two eyes,” Ludwig observed.
Though Ludwig called the agency employees providing these statistics “talented and well-intentioned,” he said the filters they used were “flawed” and the resulting calculations were “misleading.”
In one example, he said reports on unemployment often count people “unwillingly under-employed” as employed and disregard Americans “discouraged” enough to stop looking for a job.
“[T]he prevailing statistic does not account for the meagerness of any individual’s income,” he added. “Thus you could be homeless on the streets, making an intermittent income and functionally incapable of keeping your family fed, and the government would still count you as ‘employed.'”
Ludwig wrote that voter perception of the economy tends to be more accurate than government statistics. (i-stock)
Ludwig also took aim at the claims by Democrats that inflation had cooled from its record highs and that wages had risen at a faster rate.
He wrote how this was usually based on numbers from the Consumer Price Index (CPI) which tracks the prices of 80,000 goods and services across the economy. However, he warned that most modest-income Americans spend more on basic amenities like groceries and rent rather than the goods from the CPI, painting a vastly different picture.
“If prices for eggs, insurance premiums and studio apartment leases rise at a faster clip than those of luxury goods and second homes, the CPI underestimates the impact of inflation on the bulk of Americans. That, of course, is exactly what has happened,” Ludwig said.
He implored both Republicans and Democrats alike to take a more accurate view of the economy and government statistics.
“[I]f the prevailing indicators remain misleading, the facts don’t apply,” he concluded. “We have it in our grasp to cut through the mirage that led Democrats astray in 2024. The question now is whether we will correct course.”
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On Wednesday, one day after his piece, another Politico article reported on comments from former Bureau of Labor Statistics workers worried DOGE would disrupt the accuracy of the very data Ludwig said was already inaccurate.
A controversial Politico headline previously described former Vice President Kamala Harris running on a “dream economy.” (Getty Images)
Mainstream media outlets also attempted to defend former President Biden’s economy in the weeks and months leading up to the election.
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In October, Politico economics correspondent Victoria Guida wrote that “[former Vice President Kamala] Harris is riding a dream economy into the election. It may be too late for voters to notice.”
“The positive economic picture is a remarkable victory for both Biden and [Federal Reserve Chair Jerome] Powell, even as consumers still feel squeezed by higher prices,” Guida wrote.
