2024 is the inflation elections

In retrospect, the most important incident heading into this election day may not have been the Democratic Party’s decision to slide aside President Joe Biden, or the unprecedented (and undemocratic) elevation of Vice President Kamala Harris to the top of the ticket. It wasn’t the Republican Party’s inability to break Donald Trump’s grip on it, or the two assassination attempts aimed at him.

What most shaped this election happened long before. It was a decision made in the early days of the Biden administration. With the last election barely in the rearview window, Biden introduced a major stimulus bill through Congress — a bill that spent $1.9 trillion, almost all of which was borrowed — despite warning signs that the already recovering economy may not be able to handle the full influx of more dollars.

“Now is the time for big, bold action to change the course of the pandemic and begin economic recovery.” Biden promised. Bloomberg called it a “big bet on the runaway economy,” noting that the White House had “shrugged off warnings that the economy could overheat as a result.”

It was a bet that did not yield the desired results the White House had hoped.

A year later, inflation had risen to more than 9 percent, the highest level in forty years. If I’ve written beforeThat fact underestimates the historical context: Before 2021, 1991 was the last full year in which America had an average inflation rate above 4 percent. There was only one year (2008) from then through 2020 in which the annual inflation rate topped 3 percent. In other words, peak inflation was in the first half of 2022 two to three times worse than the worst bout of inflation that most Americans could easily remember.

For those of us who follow political and economic news for a living — or even as a serious hobby — this all probably feels like, well, old news. Prices have been rising at a much more normal pace over the past year or more. In September, annual inflation amounted to 2.4 percent. Higher than the pre-pandemic norm, but nothing that should cause electoral panic.

But the average voter is not a political or economic junkie, and much of America sees 2024 as the inflation election: a referendum about the federal policies that caused this brief and horrific increase in prices. (That cause is now well established: A study of the St. Louis Federal Reserve found that ‘domestic stimulus’ has played a ‘significant role’ in pushing inflation to its highest level in forty years.)

An Ipsos poll found in August that 50 percent of voters said inflation was their biggest concern ahead of the election. In October Gallup found that 90 percent of voters rated “the economy” as “extremely important” or “very important” to their vote – the highest score since the 2008 election, at the height of the mortgage crisis. Polling guru Nate Silver analyzed the numbers further and found a stunning correlation: ““Every additional $100 of inflation in a state since January 2021 portends a further swing of 1.6 against Harris in our polling average versus the Biden-Trump margin in 2020,” he said. posted on X last week.

It has been impossible for the Biden-and-then-Harris ticket to escape the inflation problem for two reasons. First, Harris has been don’t want to or can’t to distance itself from the Biden administration. And second, because the Biden White House has made economic policy so central to its message for three years — even coining the counterproductive slogan “Bidenomics.”

“Bidenomics was essentially a philosophy of throwing money at programs, people, political allies and favored constituencies. That spending contributed directly and significantly to the rapid rise in inflation, which has fueled voter dissatisfaction with the state of affairs.” Rode‘s Peter Suderman summarized in one March 2024 cover story. “Thanks to misallocation, poor implementation and conflicting regulatory requirements, the substantial public returns for that expenditure have been weak at best and counterproductive at worst.”

Of course, there are logical counterarguments to voters’ feelings about inflation in the run-up to Election Day. For example, wages have risen faster than prices. Moodys estimates that the average American household now spends $1,120 more per month to purchase the same goods and services as in January 2021, but also earns $1,192 more per month. Some products have even defied inflation: Airfares are now cheaper than before the pandemic, according to liberal commentator Matt Yglesias noted this week.

It is also true that former President Donald Trump’s economic agenda will likely cause prices to rise. Mass deportations And huge new rates will have all kinds of consequences economic disruptions And will make Americans poorer. It seems bizarre that voters looking for a stable economy after the past four years would put their trust in an erratic populist, but if this election season has proven anything, it’s that people are getting pretty irrational about inflation. In part, that’s because our brains attribute economic gains to our own performance, but look for someone (or something) else to blame when things go the other way. In other words, your paycheck got fatter because you worked harder, but your groceries got more expensive because Biden (or big business) is out to get you.

Of course that’s not true – both things happened for the same reason – but inflation breaks our brains and election day is not the time to think deeply about political science or psychology. Elections are determined by how people feel, and many Americans these days are still feeling pretty grumpy about how much it costs to go to the grocery store. It really is that simple.