Amid economic uncertainty, Georgia Republicans turn up heat on rivals

News that the nation’s economy had shrunk for a second consecutive quarter quickly became fuel for renewed GOP criticism of President Joe Biden and his Democratic allies in Georgia on Friday as Gov. Brian Kemp and other Republicans sensed a fresh opening to woo midterm voters.

The governor used an address to tie Stacey Abrams to “Joe Biden’s recession” while promising to “leave no stone unturned“ to provide Georgians relief. Senate hopeful Herschel Walker accused U.S. Sen. Raphael Warnock of doing more to further the president’s “reckless spending” than help Georgia families.

State Republicans have long tried to link their rivals with Biden, whose approval rating plummeted to 36% in the latest Atlanta Journal-Constitution poll. But this week’s economic data led to a new wave of attacks that Republicans hope will benefit them at a volatile political moment.

It was triggered by a Commerce Department report Thursday that showed gross domestic product, a key measure of economic output, fell for the second straight quarter. The back-to-back declines heightened concerns that the U.S. could be plunging into a recession.

Though Biden and his allies downplayed the development, saying the downturn is transitory, many economists say the risks of more serious economic damage are rising. Kemp underlined those concerns, blaming the president’s “runaway spending and disastrous policies” for rising prices.

“Instead of listening to the American people, Joe Biden and his liberal Democratic supporters pandered to the far-left extremists and billionaire donors who fund them,” Kemp said in prepared remarks Friday.

“As a result, just as Georgians are getting their feet back under them after the pandemic,” Kemp said, “we now have 40-year high inflation, pain at the gas pump and an economic recession.”

The economic cooldown comes as Democrats seek to energize voters upset with the U.S. Supreme Court ruling that paved the way for a restrictive anti-abortion law to take effect. The AJC poll showed that a majority of likely voters oppose both the ruling and the state’s abortion limits.

Credit: Associated Press

Credit: Associated Press

Top Democrats have also tried to insulate themselves from economic attacks. Warnock has pushed for gas tax relief and pledged this week to vote for a climate change and tax package that Democrats say would bring down the cost of living.

And Abrams’ economic plan includes calls to expand Medicaid, deliver a $1 billion tax rebate and provide more affordable housing to buffer Georgians from financial aftershocks — all policies she emphasized Thursday after a campaign stop in Athens.

“We are not in a recession,” she said. “We know that the economic data is concerning, but we also know this is a global phenomenon. And the important response is: How does the state of Georgia address the challenges?”

Democrats also countered by chastising Kemp for signing legislation that restricts abortion and rolls back gun regulations while not issuing specific plans for his second-term agenda.

U.S. Rep. Nikema Williams, the state Democratic Party chair, pointed out Abrams’ plans to hike the salaries of teachers and certain law enforcement officers and suspend the state sales tax on gas through the end of the year.

It’s “all to help working Georgians, and all without raising taxes,” Williams said. “Brian Kemp’s response? Crickets. Because he has no desire and no plans to help working people.”

Higher costs for food, fuel

For many voters, whether the nation is officially mired in a recession isn’t as important as the tangible effect on their wallets. Food and fuel costs more, and families are struggling to maintain their quality of life.

“Because of income inequality, many families live in a constant fear of recession,” Democratic state Rep. Erick Allen said. “It’s about how they feel — not what someone tells them is going on with the economy.”

Allen, who ran unsuccessfully for lieutenant governor, hopes the surprise deal U.S. Senate leaders struck this week to lower drug costs and combat climate change through a package financed by raising taxes on big companies will “reenergize Democrats.”

With polls showing that rising prices and high energy costs are the chief concern of voters, Republicans are eager to center their campaign message on the economy.

Walker said the recently unveiled Senate proposal “would take more money from hardworking Georgians and this new government spending will only make inflation worse and drive up prices.”

The bill actually doesn’t include tax increases on most Georgians. It does have a new 15% minimum tax on corporations that earn more than $1 billion in annual profits.

It’s a way to clamp down on some 200 U.S. companies that avoid paying the standard 21% corporate tax rate, including some that end up paying no taxes at all.

The former football star has eagerly brought up economic concerns when pressed on other issues, such as at a campaign stop on Friday where he was asked about his past false statements about serving in law enforcement.

“In my hometown, people are living paycheck to paycheck. They can’t afford gas who can’t afford groceries. These are problems people are talking about,” he said. “And I think the media and the elites in Washington want to talk about things and address things people are not concerned about.”

Kemp, meanwhile drew a contrast between the nation’s financial doldrums and his stewardship of the state economy.

He trumpeted his decision to aggressively reopen some shuttered businesses during the first fraught weeks of the coronavirus pandemic, along with new data that showed metro Atlanta’s economy had its second-best June on record. During a visit to a nearby high school, he also announced $125 stipends for teachers to use on back-to-school supplies, paid for with federal COVID-19 relief money.

The governor’s address was peppered with hints he would dip into the state’s record surplus next year to offer Georgians more tax refunds and other perks as Kemp promised to “utilize every tool at our disposal to lessen the impact of this recession” on Georgia families.

“Make no mistake: This is the Biden-Abrams agenda for Georgia. Stacey Abrams campaigned for Joe Biden, publicly auditioned to be his vice president, celebrated his victory and took credit for his win,” he said.

“This is why I always say this election for governor in November is a fight for the soul of our state,” Kemp said. “It’s also a fight for our livelihoods and a fight for our family budgets.”

FRIDAY’S DEVELOPMENTS

Inflation: Two key U.S. inflation gauges posted larger-than-forecast increases, heightening concerns that prices will remain persistently high and prompt continued aggressive interest-rate increases from the Federal Reserve.

Consumer spending: Consumer spending jumped in June, federal data show, as Americans continue to absorb stubbornly high prices on groceries, gasoline and other staples. The government’s numbers also showed that consumers are cutting out unnecessary expenditures to afford fuel and food.

Markets: Stocks are adding to their recent gains in afternoon trading Friday. The S&P 500 was up xxxxx as of 2:18 p.m. Eastern, while the Nasdaq was up xxx. Both indexes are on pace to end July with the biggest gains since November 2020.

Details, A3, A6