Bidenomics: An economic turning point - How US financial and economic policy is fundamentally changing under Joe Biden.

Bidenomics: An economic turning point - How US financial and economic policy is fundamentally changing under Joe Biden.

According to a report by www.n-tv.de, US President Joe Biden has launched several major economic stimulus and investment programs that usher in a new era of US economic policy. The economist Max Krahé sees this as a paradigm shift that differs from previous US economic policy in three ways. First, Biden breaks with the old paradigm of neoliberalism by declaring its failure. Secondly, he aims to shape policy and specifically tries to bring industrial production back to the USA. And thirdly, it reverses the relationship between financial and economic policy by setting political goals and then adapting financial planning to them. These features are reflected in four laws that together provide several trillion US dollars for social, climate policy, security policy and distribution policy goals. This approach of setting political goals and then adjusting financing is very different from the German debt brake. However, there are also risks, such as possible over-subsidization or failure of investments. Nevertheless, it is a trade-off between various risks that is driving the Biden administration to pursue this new economic policy. The article suggests that this turning point is due to Donald Trump's election victory, concerns about American democracy, US vulnerabilities due to dependence on imports, and the rise of left-wing ideas within the Democratic Party. The likelihood of a reversion to the old pattern after a change of government is considered to be low, as this policy not only serves the interests of the Democratic Party, but also supports structurally weak regions that predominantly vote Republican. It is still too early to assess the success of this policy, but possible benchmarks could be the development of investments, income distribution and the reduction of emissions. Overall, “Bidenomics” represents a significant shift in US economic policy that is likely to have long-term effects on the market and the financial industry.

Source: According to a report from www.n-tv.de