Last Friday the BLS reported the October unemployment rate rose 0.1 percent to 3.9 percent. Since the unemployment rate bottomed in the spring at 3.4 percent, the 0.5 jump in the unemployment rate is consistent with many past business cycles, namely, the unemployment rate goes sideways and then begins to rise over an 18-month period. A recession and rising unemployment unfold. In other words, this time is not different.
The “outlier” on the chart below is the Covid lockdowns that caused the unemployment rate to skyrocket and then plummeted as businesses opened as the lockdowns were eased or eliminated in numerous states.
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When the downturn begins the economy tends to look “OK” to most policymakers, the talking heads on TV, and the incumbent president’s congressional supporters. But the reality is that a recession unfolds slowly then accelerates catching the so-called experts off guard. Moreover, rising unemployment during a presidential election year is the proverbial kiss of death for the incumbent running for reelection.
Thus, no matter who the Democratic presidential candidate will be next year—and it will not be Biden nor Harris as I predicted earlier this year—the GOP presidential candidate should win relatively easily.
Biden’s approval ratings are in the dumps, Democratic insiders are calling for Joe to drop out, and an obscure congressman has entered the Democratic primary. And the Israel-Hamas war is causing a split within the Democratic party as the Progressives are asserting Biden is enabling the IDF to “commit genocide” in the Gaza Strip. In short, what could go wrong is going wrong for an incumbent president.
In fact, William McGurn points out the similarities between 1968 and 2024, down to next year’s convention in Chicago, which was also held in the Windy City 55 years ago, when antiwar demonstrators and the Chicago police clashed in the streets as Vice President Humphrey was nominated to succeed LBJ.
This time the Democrats want to avoid a contentious and expensive primary. Presidential candidates from the prowar and antiwar factions would have a battle royale. Biden will limp toward the convention where the deal would be cut to replace him unless a Progressive Democrat jumps into the race soon and badly “bloodies” Joe who may withdraw sooner rather than later.
Either way, get out the popcorn. 2024 could make 1968 look like a Sunday picnic.
America’s interventionist policies are enabling wars in the Ukraine and the Middle East instead of working feverishly to create peace. As JFK asserted in his June 1963 Commencement Address, the goal of the nation state is to avoid war—one of his most important legacies.
A growing peace movement is about to make for strange bedfellows.