The Economy & The 2024 Election: How Influential Is a President Economically?

By Trent Lopez

With the 2024 election under wraps and President-Elect Donald J. Trump taking office once again in 2025, it is a fragile time for the economy and a political playing ground with further division between party lines. With the COVID-19 pandemic fading in the background, President Joe Biden has been tasked with promoting prosperity and providing relief to highly affected families, businesses, and institutions, especially in recession-associated issues like unemployment and gas prices. Americans have been plagued with concerns for years about how and who could potentially steer the country toward an upswing and crush the recession without causing further harm to the pockets of citizens. During the election, there were many claims and declarations about how President Trump would fix the economy President Biden broke, an idea that drove up his voter turnout and potentially granted him the victory against acting Vice President Kamala Harris. Following the election, the party division is being further emphasized due to talks about what the country needs to grow and restabilize after many events, and most importantly, political shifts. But can one person fix the economy, and if so, is it the president? The point of this article will be to explore how economic change is achieved, as well as what types of abilities a president has to encourage such conditions. 

It all begins with the Great Depression and the era of the FDR Administration that pushed the New Deal. The New Deal was a set of legislation aimed at relieving pressure from the depression. The FDR administration was one of the first administrations to practice significant power via influence and policy to affect the economy. Up until the Great Depression, the government had been approaching the economy from the standpoint of little intervention, aside from the use of tariffs (government-imposed taxes on foreign goods) to encourage American dollars to be spent on American-made goods. With FDR’s New Deal making headlines and proving to be crucially important to supporting the U.S. economy and other social variables, like creating the Social Security Administration, it was clear to everyone that the presidency had a newfound sense of power when it came to impacting the economy. This was evident following the end of the Great Depression and World War II when President Woodrow Wilson and Congress promoted a central bank, later known as the Federal Reserve. The purpose of the Federal Reserve is to work at controlling interest rates, dictating how much money is circulating and in which ways it can be better utilized, protecting consumers, and monitoring banks and their conduct. Often, the Fed will lower interest rates and increase the money supply, which will encourage more spending on every level of social class. To slow down the economy, the Fed will do the opposite and raise interest rates to reduce the money supply, discourage spending, and bring inflation down. Due to so much government intervention and the development of institutions like the Federal Reserve, there was much debate on whether the country should continue a laissez-faire (little to no government control) stance, or commit more to interventionist strategies. 

In the present, it is common to hear a president using their powers to influence systems and institutions while working to carry out their respective party’s political agenda. The president has four crucial powers: the ability to appoint people to certain positions, their influence on the policy agenda, their role as a party leader and coalition builder, and the veto. These powers are a combination of checks and balances, and efforts to sustain stability of political and economic institutions. The veto is essentially a way for the president to check the power of Congress by being able to strike down any piece of legislation of their choosing, not to mention that it takes a two-thirds vote of the House and Senate to override the veto. One way the veto can influence the economy is by the president being able to veto budget bills that Congress has passed and sent to the executive for final approval. There is also the role of coalition building and serving to support their political party’s agenda while being able to compromise and work with people from the opposite party to make change and enact legislation. Having support from both sides of party lines can prove to be beneficial when it comes to getting support for certain bills or budgets that could cause anomalies in the economy. Finally, one of the other powers that leads into discussion of the president and the economy is their ability to appoint people to certain positions. A president is able to slightly influence monetary policy by choosing who will take the governing chair position of the Federal Reserve that lasts a term of fourteen years and is considered an independent institution. The independence of the Federal Reserve is underscored by its freedom to create budget proposals, work with protections against political influence, does not receive congressional funding, aims to stabilize prices for citizens and maximize employment, while also having fairly long terms for positions as to create less politically-focused change via presidential appointments. Two mandatory goals Congress set for the Fed at its creation were to eliminate unemployment and create economic stability for every person, with no goal to put any political party ahead of the long-term economic prosperity of the country overall. 

With this in mind, the president also has great power which they are able to harness through their speeches, public appearances, and ability to send bills to Congress. Most voters will be swayed to support a candidate or acting president who demonstrates the capability to critically think about the economy and develop plans to increase the overall wellbeing of people through economic policy. It is imperative for presidents to establish legitimacy through authoritative means of communication and suggestions towards change. The quality of presented agendas by presidents and majorities in Congress can affect how much support they receive during election years, in addition to steering the public opinion on which candidate may be the highest of authoritative quality of leadership to guide economic prosperity. A common way to establish legitimacy is with how the president will submit yearly budget plans to Congress for approval, revolving around either increasing or cutting taxes and how to combat budget deficits, which aren’t necessarily policies or definite actions taken to grow the economy, but rather put up a plan for Congress and the Federal Reserve to potentially act on. It is important to understand that the president cannot automatically fix the economy or issue a set of actions to be taken immediately. Everything still must happen democratically and as a group rather than a sole leader. 

This all relates to the 2024 election where now President-Elect Donald Trump proposed many ideas as to how to stimulate the economy to produce growth that will help alleviate Americans around the country suffering from inflation. Former President Trump had been quite vocal during his campaign about what he would push for: tax cuts, deregulation of U.S. industries, tariffs on foreign goods with an emphasis on Chinese products, and lastly, a mass deportation plan. Although deregulation and tax cuts for industries can improve innovation, market competition, help grow the economy, etc., the issue with this agenda is that it would lead to higher consumer prices, an increase in the government budget deficit, the dulling of the Federal Reserve’s powers, labor shortages from deportation, and a possible new era of stagflation. Trade and immigration policy is not necessarily a positive combination, as economists believe it’s actually disruptive to growth and could be another reason as to why the Federal Reserve may choose to keep interest rates the same until the Trump Administration can encourage more expansive growth. The issues of deregulation could also be just as detrimental, as we are in an era of notable climate change further exacerbated by industry competition and innovation that lacks regulation.

It begs the question of what the values of our country are now that the 2024 election has concluded. According to Georgia Tech’s Ivan Allen College of Liberal Arts, the most impactful traits a presidential candidate can have are the following: a strong vision of direction, responsiveness to crises, the ability to build trust throughout government and economic institutions, and the capability to negotiate and compromise with others. This can ultimately pin the border, economy, immigration, etc., as being the current crises of the United States, and further highlights this shift towards conservatism due to Former President Trump’s strongly one-sided agenda. Trump received the majority of the popular and electoral college vote, which also raises the question of how citizens perceive candidates and use the economy to justify the way they vote. It can be an issue that the majority of citizens only perceive the conditions of the economy during an election year, as opposed to the conditions under the entirety of a presidential term which can give a less accurate picture of how well a president has actually helped economic prosperity. With President Biden fighting a rough patch of inflation, it was easy for voters to want to vote Republican after hearing Trump’s radical agenda. The issue with this is that people associate Kamala Harris with Joe Biden without batting an eye to Harris’s plans to focus on legislation that helps citizens. 

President Biden has made much economic progress that was smothered by the conditions of the election year economy and the intensity of inflation deriving from the previous administration. There is a constant cycle of efforts to keep the economy afloat, which is a necessity on all parts of the government, especially the president, to enact legislation to ensure there are no issues that could detrimentally impact the economy and fellow Americans. With President Biden taking a progressive stance on change, Trump’s radical plan of deregulation, tariffs, and deportation sounds harsher on paper, which raises the issue of whether or not the country will reach another level of stagflation. This is especially wondered about due to there being little evidence to prove that a relationship between president and economy permits high levels of economic performance. Considering the Trump Administration’s agenda, deportation and tariffs would be rather effective at creating immediate negative effects for citizens with regards to prices at grocery stores and at the gas pump, as well as cutting our workforce greatly by multiple percentage points. 

Fixing the economy is the job of multiple institutions, and not one individual, but a single person is still able to cause disruptions and push for agendas that can have immediate effects in certain respects. To influence the economy and stimulate growth, it takes work mainly from the Federal Reserve, Congress, and the President in conjunction. Trump’s 2024 election proposals are manipulative to try and convince the American people that he could fix it all. Cutting the workforce, causing the increase of taxes on foreign goods that every day people rely on, and deregulating industries and allowing them to act freely, will do nothing but cause issues for Americans going into the new year and next administration. Mass deportations are an attempt to marginalize immigrants who are actively contributing to the country. Tariffs will propel inflation, making it harder for hardworking families to put food on the table and get their kids through school.It will be vital for Americans to do research and read into legislation proposed by the Trump Administration to avoid any further detriments to the collective wellbeing of citizens nationwide.

Featured Image: Max Zolotukhin for Getty Images