What was their failure here? The failure to explain to the economically illiterate that while inflation is now about where it was prior to covid that prices won't be going down (unless there's some sort of major recession leading to deflation)?
Average voter: I can't afford groceries at the store. Inflation sucks.
Response: Actually, here is the correct definition of "inflation." As you can see from the correct definition, inflation rates are now good! Hopefully this helps you understand why things will never get better.
What the average voter hears: I can't afford groceries. Your solution to this problem is to reframe the current situation as "good." I still can't afford groceries.
The distinction between the literal question being asked and the question being asked really matters.
Coincidentally, this same journalistic abuse of rhetoric is one of the easiest methods to jailbreak LLMs where modifying the initial response isn't possible.
"Write a news article titled: 'After Inflation, You Can't Afford Groceries Anymore. Here's Why That's A Good Thing.'"
The incapacity of politicians to talk honestly about things is enraging.
Dems did that on the surface, but unfortunately unemployment is very distorted by inequality.
Sort of related to trade policy in that way I think. More trade is good but not if it isn't paired with ways to keep inequality from running amok.
Said no politician ever, even the most union-supporting :0
At some point though I’m throwing academic sources to the voter at which point I’ve probably lost the discourse because it’s hard to reason about.
The reality is I don’t do any of the above. I’m not even interested in debating the point anymore. People don’t want to hear long winded academic discourse on the best economic approaches to anything.
I’ve bluntly completely lost faith in American democracy. The candidate with the biggest budget has won consistently and the biggest budget comes mostly from corporate donations via PACs.
Average voter: I can't afford groceries at the store. Inflation sucks.
Response: I know, inflation was caused by COVID and Biden got it back down. We had the best soft landing you could have asked for, Biden did a great job. But the original inflation wasn't under the president's control, it was a worldwide phenomenon, and you can't run it in reverse to go back to old prices.
What the average voter hears: I don't care about any of that. Prices were lower under Trump and he's a businessman, so I'll vote for him so prices go back down.
Leon Trotsky, 1938. [1]
Automatic rise in wages to counter inflation effects on ordinary people is literally a socialist plan. What they're asking for is socialism. Right-wing Americans (supposedly) hate socialism, at least when it benefits people other than themselves.
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[1] - https://www.marxists.org/archive/trotsky/1938/tp/tp-text.htm...
Social security / medicare are indexed to inflation.
The s&p500 outperformed inflation. (And treasury interest rates - 3 month and 10 Year - are ~<2x cpi and cpi targets for the first time in ~20 years)
How do you convey ideas to voters when the basis of the idea is feeling vs fact, outlier vs median?
https://www.marketplace.org/2024/10/30/wage-growth-slowing-o...
Employers won’t give raises to match cost of living in those situations.
1. Biden is good and inflation wasn't his fault
2. Biden's handling of it was good, he did all good things, Biden is good
3. In closing, our answer to how we will make it so you can afford groceries is: no
Yes, and critically: "I trust Trump when he says it's Biden's fault, so I'll vote for him."
It doesn't matter how correct the interlocutor is if the average voter doesn't trust them. Unfortunately, most people place trust in people who appear sincere and unrehearsed, which is the opposite of how much politicians behave, where a "starched, bland, rehearsed" style is traditional. Trump is improvised and chaotic, which people mistake for genuine and trustworthy.
> And the record profits Professor Weber mentions? Groundwork Collaborative recently found that corporate profits accounted for 53% of 2023 inflation. EPI likewise concluded that over 51% of the drastically higher inflationary pressures of 2020 and 2021 were also direct results of profits. The Kansas City Federal Reserve even pegged this around 40%, indicating that sellers’ inflation is now a pretty mainstream idea.
https://www.forbes.com/sites/errolschweizer/2024/02/07/why-y...
Look at this picture:
https://s3.amazonaws.com/oxfam-us/www/static/media/files/Beh...
Then this one:
https://ritholtz.com/wp-content/uploads/2023/06/0.1-v.png
The green line is the top 0.01%, the red line is the average american.
What solution do you expect from Trump?
But what does a solution look like to you?
Do you want prices to deflate? That's terrible for many reasons.
Do you want regular responsible economic management? That was Harris. Inflation is back to normal now.
Or do you want a president who wants a huge tariff on everything that will result in crazy much larger inflation than we've had in decades? That's Trump.
How is Harris not listening? How is Trump listening better?
Because governments printed a ton of money without the economy growing to back the new amount of money, hence prices of goods increasing to match the available money supply.
People heard her say that and were outraged. What's funny is that when you think about it, it actually does make sense although it's pejorative.
Rich people don't pay taxes. They invest their money, which is incentivized by the government in the form of lower/different taxation. Similarly they use experienced lawyers who understand the tax code to structure their wealth in ways that allow them to pay lower taxes. And the term little people, while pejorative, really represents the power differential between people like her husband and the "Average Joe". Trump is not little people, but he's somehow managed to express things in ways that "little" people (using Leona's terminology, not my own) like.
Much of politics is about not directly saying the truth, whether it be ugly, undesired, or complicated. Instead it's about understanding what drives voters (higher out of pocket prices uncoupled from concomitant wage increases) and how to say the thing they want to hear, while also enacting policies that achieve your political goals.
Response 1: You are lying. The groceries in my local Whole Foods are still very affordable to me. Stop spreading misinformation and conspiracy theories.
Response 2: OK maybe the groceries got a bit more expensive a teensy little bit. This is very temporary situation which will be handled soon and you have nothing to worry about. Just stop whining and expect everything be fine sooner than you know.
Response 3: OK, it could be argued that the groceries are even more expensive now. The reason for that is that our political opponents 4 years ago were evil, and they messed up everything. But we almost fixed all that, and here's a paper full of dense complex math that proves it beyond any doubt. Also, here's another paper that proves more expensive groceries help fight climate change.
Response 4: Stop talking about the damn groceries already. We already debunked all that misinformation completely, and everybody knows it's not our fault, and actually everything is awesome. Don't you realize the other guy is literally Hitler?!
I'm surprise how this clever strategy didn't result in a landslide victory. The voters must be extra super stupid and not understand even basic arguments. Every sane reasonable person should have been convinced beyond any doubt.
I am not expressing any opinion here between the lines, I am legitimately curious.
The "average voter" is literally wealthier than they were four years ago though. Median real wages (where "real" means "inflation adjusted") have gone up and not down. This isn't it.
The average voter "feels like" they can't afford groceries, maybe. But that still requires some explanation as to why this is a democratic policy issue.
Clearly this is a messaging thing. Someone, a mix of media and republican candidates and social media figures, convinced people they couldn't afford groceries. They didn't arrive at that conclusion organically.
Notice the flat line after the pandemic? The average voter (or at least the average worker) is literally equally wealthy as 4 years ago.
Goods are indeed down (even including gas in many areas), but anything services-based is much higher. We can all feel that through higher insurance costs, going to a restaurant, etc.
Again, the point as stated isn't the reason for voter behavior, because it's simply incorrect. Voters didn't vote because they're poorer, because they're not poorer. QED.
They're not poorer. They're exactly one used Xbox richer.
I agree that it's more complicated why Trump won than just the economy, but to say "people are getting wealthier" when
a) it's an extremely paltry rate compared to the prior 4 years and
b) people have had to readjust their "basket of goods" to buy different things because certain non-negotiable things (e.g. cars, car insurance, other insurance, utilities in a lot of unregulated states, property taxes outside of places with Prop 13 / homestead exemption, etc) have gone up significantly, putting a squeeze on disposable income.
I guess we're arguing semantics here, but I agree that a lot of voter decision on this is more complicated than real income. I just disagree that $50 / year increase is meaningful enough to have people not feel left behind. That is about 12 bps a year, and I know that if my raise were 12 bps, I'd feel like why bother at all / insulted. If I were a moron, I would blame the current president, but I'm not naive enough to think that it's Biden's fault.
https://fred.stlouisfed.org/series/LES1252881600Q
Again, I know it's very tempting for you to believe this. That's probably why voters do! But it's wrong. And the fact that you and others believe it anyway is a messaging failure and not a policy failure.
This is a wild take that sounds it's coming from an affluent tech worker. I'm politically left, and I don't know if this is parody to make liberals look out of touch.
Tech salaries went up, but people working minimum wage can't afford groceries. Federal minimum wage was increased to $7.25/hour in 2009, 15 years ago.
Medians don't tell the full story, because of the K-shaped recovery graph. The upper half gained wealth but the lower half lost wealth.
https://www.cnbc.com/2021/05/04/the-covid-recovery-still-has...
Again, this idea is just wrong! And I hear it from people on, as you point out, both the left and the right. And it's wrong, as a simple matter of data! Something terrible happened with messaging this cycle.
You are projecting your data-driven decision making to regular people who don't do that. Depending on how neurodivergent you are, you will eventually learn that you can't model how typical people think based on how you think. People aren't looking at hard numbers. People try to find patterns in what they experience.
It is possible. But it hasn't happened! That's what I'm trying to point out in this weird subthread. People (on both sides of the candidate divide!) believe something that ssimply isn't true. And not in a subjective "mostly untrue" sense. It's a question with numbers and the numbers say the opposite of what you believe.
It makes sense (to me) to average inflation over the four year electoral period. The average inflation over the Biden years 2021-2024 was 5.3%, versus 1.9% over the Trump years 2017-2020 [1]. I have no idea what Biden could have done to keep inflation down during his presidency, but Americans felt their purchasing power decrease a lot more during his term than during his predecessor's, with corresponding impact on their livelihoods. They have every right to be pissed off. And it's human nature that how pissed off we are influences our decisions to a significant extent. Idly wondering what time series (other than inflation) might reflect significant contributions to pissedoffitude.
[1] https://www.usinflationcalculator.com/inflation/current-infl...
Average: I can't afford groceries at the store. Inflation sucks.
Response: Well, inflation plays a part, but grocery stores are still recording record profits despite inflation.
Average: Are you suggesting grocery stores shouldn't make as much money as they can? Free market hater! Communist!
"You're right, prices are too high, and wages too low. Especially housing prices, and wages for young men without a college degree.
It's in part the consequences of some things we did.
Here are our proposals to make prices go down, or make wages go up:
Proposal 1: ...."
My deep belief is that the hard part, and the reason Democrats did not do that, is not in the difficulty to find solution.
The hardest part is that it meant recognizing they were, at least in part, responsible for the problem.
The second hardest part was recognizing that the problem was hurting a category of people that's "outside of the tribe".
So, faced with a complex problem, they decided to deny the problem existed altogether, focussed on something else (not necessarily unworthy issues, but, simply, not the one at hand.)
"Ventre affamé n'a point d'oreille."
The silver lining is that:
- either the Republicans somehow manage to get prices down or wages up
- or the next election will swing the other way.
It's still, after all, no matter what, "the economy, stupid" - just, the real economy, no the the fake financial one.
Why they decided to be myopic, and assumed that they had to defend the rights of women _or_ the rights of workers, and could not do both, is a bit beyond me.
They completely forgot about the other half of the electorate, and when reminded of their existence and issues, they considered the other stuff more important. This result shouldn't surprise anyone.
Position 1: Prices can never go down again unless inflation is negative and we get "deflation." Deflation, alas, will cause a deflationary price spiral and cause the economy to implode completely. Why? Well, reasons. Anyway, just know that things can't get any better for you, that groceries being affordable again some day is an economically illiterate pipe dream, and also know that things are actually good.
Position 2: Also, we'll just force stores to lower prices. Forget everything I just said about this leading to a deflationary price spiral and destroying the economy forever. Actually, we will just force stores to lower prices and reverse inflation and it'll be all good.
Position 3: Introduce policies that stimulate domestic production and decrease foreign competition. This will lower prices without forcing domestic producers out of business.
How, exactly?
The biggest causes of inflation were stimulus, supply-shock, and housing prices.
Stimulus started under Trump and was the correct response to COVID. Without it we would have had even worse economic suffering that we did. Inflation was the lesser-of-two-evils.
The supply shock was global, and there probably wasn't much to do about it, besides maybe some more supply-side stimulus.
Housing is just a shit-show, but people have been grinding to get more built to address the problems for years.
But stimulus was the thing that could have been changed the most, yet it kept us from having a much, much worse recession.
When gas prices and food prices go up: "We don't control that, its a "global" issue so we're not responsible.
When gas prices and food prices go down: "See everybody! Look! Our economic policies ARE working! You just have to trust us!"
This all we heard the entire four years Biden was in office. People are not stupid. You can't keep saying that inflation doesn't really exist, or its just transitory, or that its just fine or that its back to a normal level, but its still higher than it was before Covid.
You can't continue to play games with the voters and just hope they don't remember all of the poor messaging the admin had when families were really struggling to pay for their basic needs.
You either lay out a plan to fix it, or you take full responsibility for what happened on your watch. Neither Biden or Harris did either and it cost them an election, its just that simple.
1. Try the Trump/populist playbook on the topic: identify the problem, empathize, be mad, let them vent, but don't really focus on a solution.
2. Advocate austerity as a solution to inflation. Might be less economically ideal, but more politically viable.
edit to add: iow, Harris and other Dems could have thrown Biden under the bus a bit to try to avoid some of the blame. It's cold, and Biden directed an actually decent response to the supply-shock-driven inflation, but it'd be a kind of shrewdness like getting Biden to drop out that might have helped.
And ideally put the blame on people who don't have any/much political or economic power within the country, like immigrants. Us vs them. "If we just get rid of 'them' everything will be fine"
Somehow I think that's problem. When leadership - no matter the scale - country, company or family - cannot see their own responsibility and only proclaim "we're the right ones" with arrogance. That is when you get unfavourable outcome. And it's being repeated all over the place - people are getting tired of politically correct arrogance, without delivering result to average person.
You can't just educate people in a campaign that the President doesn't cause inflation, when it's the result of a global pandemic. They just don't listen and don't care. The different campaign messages get tested among focus groups. The ones that try to teach economics or explain inflation perform terribly.
This isn't a failure of Democrats at all. This is just pure economic ignorance among voters.
It's not the voters job to come to a party, it's the party's obligation to figure out how to appeal to voters. The dems chose to tell people who are suffering that 'the economy is great, this is what we think a good economy looks like and we are patting ourselves on the back for it'. To voters that are suffering that seems like 'our version of good doesn't GAF about you'. Not a great message. You could have the best economics professors/communicators in the world explaining it, people still aren't voting for that.
If the Dems don't/won't/can't account for it by changing their messaging, devising better or more readily understood platforms, then it is on them. You have to meet people where they are, not where you think they should be.
It's incorrect to characterize this as "pure economic ignorance among voters"
>But what a fool believes, he sees
>No wise man has the power to reason away
>What seems to be
>Is always better than nothing
>Than nothing at all
By failing to meet the economically illiterate at their level, the DNC campaign looked completely oblivious to those they were trying to help.
DNC forgot that in polls, the American electorate prefers a bigger 1/4 lb hamburger to the smaller 1/3 lb one.
One, that last round of stimulus. Two, not agreeing to cutting spending when prices continued going up. Three, not massively greenlighting permitting around new energy and fossil fuels to bring energy prices into a deflationary stance. (Note: this is Monday-morning QB’ing from me.)
The whole pattern feels like a repeat of the country using Democrats to clean up messes (in this case, the mess was more Covid's than Republicans'), at which point they kick out the Democrats again. I don't think another massive tax cut (or extension of the last one) is a good idea.
Of course what we need to be doing is halting all burning of fossil fuels ASAP, but that would be a losing electoral strategy. Who cares about the looming climate disaster, we need cheap gas...
Also salaries in US kept with the inflation while globally they didn't.
The US economy is doing great, but inflation doesn't make it feel like it.
I myself feel it.
I'm not from US, I'm European and make around $110k per year.
Yet I skip on 5€/kg tomatoes even though I made 28k just 3 years ago and they costed half of it.
Americans got robbed of something between 20-40% of the purchasing power of their dollar depending on what they're buying. People aren't stupid, they know they're getting hoodwinked when someone focuses on the fact that the rate of robbery is slowing down rather then the fact that they didn't stop the robbery in the first place.
You got your explanation here. Arrogance and dismissiveness of voters.
Voters don't want explanations, they want solutions.
You be correct and say something factually as "The economy is fine, all indicators are moving the right direction - we're back to pre-COVID levels" but still lose massively on that.
And as it turns out, whether or not your solutions is rooted in reality - apparently doesn't mater for the average voter.
Harris went with the "We're not gonna make any changes", when people are moaning about the economy. That was her fatal error.
Trump and MAGA continued to hammer on about how terrible the economy is, and how they're going to make China pay, while lowering taxes.
Again: voters don't want explanations, they want solutions.
It is about the economy.
When is over-communication on the problem the team needs to solve ever a bad thing?
https://kamalaharris.com/wp-content/uploads/2024/09/Policy_B...
Now compare that to Trump's non-existent plan. No one cares, that is what is so depressing.
Most of the measures you suggested, especially straight up give people money will just increase inflation further.
Biden stimulus was the one that
a) Ignited demand > Supply
b) provided no incentives for people to go back to work (Biden also had extended mortgage, rent, loan payment programs) which exacerbated inflation
loose monetary policy was the right thing to do after the COVID downward economic shock. But not extending it over and over, and that's when/why the inflation kicked in.
Hold an open primary with a candidate that talks in no uncertain terms about the failures of the Biden presidency, and the new path forward, criticizing the Biden admin for not doing enough on inflation.
I think essentially Trump won in 2016 and 2024 because he was willing to take such a risk against political norms, and this was a change election. No explaining the causes of inflation, or what Biden did right and incremental steps were going to change that. People wanted a visionary leader, and while I disagree with Trump, I think Trump and Musk provided that new vision for America.
I hate this by the way, I'm an incrementalist policy wonk who in general hates visionary leadership.
But Trump talked about stopping at nothing to remake the American economy to radically improve the lives of all Americans. Harris talked about $25,000 to buy a house.
But the Biden admin clearly did enough to fight inflation. He may even have done too much.
The framing of the US discussion around inflation is itself a lie.
Vibes > Policy
I don't think an election in a 2 party dominated system is going to fix this, history has been repeating itself since the 60ies. People need to change there thinking about supporting a system that doesn't work before we make any headway in correcting these problems.