Inflation and high prices have become major issues in the 2024 presidential election. Public anger over these issues and the overall state of the economy may be the biggest obstacle to President Biden’s reelection chances. A recent poll commissioned by Harris guardian Public attitudes towards inflation and economic conditions were found to be largely influenced by ignorance. While inflation does rise sharply in 2021-22, the economy is currently in much better shape than most voters believe:
The poll highlights many misconceptions about the economy, including:
Fifty-five percent believe the economy is shrinking and 56% believe the U.S. is experiencing a recession, even though gross domestic product (GDP), the broadest economic indicator, has been growing.
49% think the S&P 500 will fall this year, even though the index is up about 24% in 2023 and more than 12% this year.
49% think the unemployment rate is at a 50-year high, although the unemployment rate has been below 4% and close to a 50-year low…
The poll highlights mixed feelings about inflation. The vast majority of respondents (72%) said they believed inflation was increasing. In fact, inflation has fallen sharply from its post-COVID peak of 9.1% and has fluctuated between 3% and 4% annually.
In April, the inflation rate fell from 3.5% to 3.4%, well below the 40-year peak of 9.1% in June 2022, triggering a rebound in the stock market and pushing the Dow Jones index to a record high.
The poll also found that 58% of respondents blamed Biden for the economic situation. It’s part of a broader pattern in which people attribute and blame short-term economic trends to the current president, even though the latter generally has little influence on them.
this guardianOf course, this is a left-wing outlet, and that perspective likely influenced their commissioning of this survey. But Harris is a generally respected polling firm, and I don’t think there are major flaws in the wording of the questions in this survey.
Biden may indeed bear some responsibility for the massive outbreak of inflation in the post-pandemic period. His support for massive increases in spending helped create a massive increase in the amount of money in the economy without a corresponding increase in output. But much of that spending is also supported by Republicans, including President Donald Trump, who remains in office in 2020-21. Biden is also to blame, as he has continued to impose many of Trump’s tariffs (resulting in sharply higher prices and reduced consumer welfare) and added some of his own. Still, Biden supports few inflationary policies that Trump would do differently. The Federal Reserve also has bipartisan support for injecting large amounts of money into the economy during the COVID-19 pandemic.
The evidence from this poll only scratches the surface of public ignorance about inflation, prices and related issues. For example, a February poll found that 59% of Americans believe corporate greed is the “main cause” of inflation. Economists overwhelmingly reject this idea—not because businesses aren’t greedy for profits, but because there’s no good reason to believe that businesses will be more greedy in periods of high inflation, or that their greed will have a greater impact during such periods . Corporate greed is a constant and therefore cannot account for variables such as inflation or price changes. In this case, public ignorance may help Democrats to some extent, as they place a greater emphasis on curbing corporate greed than do Republicans.
Ignorance also explains why voters angry about inflation and high prices tend to support Trump. In doing so, they ignore the fact that many of his policies will make price increases even worse. For example, Trump plans to impose a 10% tariff on all imported goods, which will significantly increase the price of many goods, costing the average American household about $1,700 per year. That goes well beyond what Biden has proposed, even though his trade record is far from stellar.
Trump’s plan to mass deport undocumented immigrants will also predictably lower output and raise prices across much of the economy, potentially spurring inflation more generally. Contrary to popular belief, such expulsions also created more jobs for native-born workers than they created, making it more difficult for many families to make ends meet.
Trump also plans to undermine the Fed’s independence. If he succeeds, inflation could also worsen. Historically, more independent central banks have done better at curbing inflation than those more vulnerable to political pressure.
Biden’s record on inflation and prices is far from ideal. But Trump’s policies could be worse. If voters who care about these issues understood this, they would move in a different direction.
Public ignorance about inflation and the economy is part of a wider problem of widespread political ignorance that degrades the quality of public policy. While ignorance benefits Trump and the Republican Party in this case, the problem is not limited to either side of the political spectrum and does not always favor the political right over the left. There are many examples of ignorance and misunderstanding that are more common among Democrats and those on the left.
The fundamental problem is not that voters are stupid, but that the small likelihood that any one vote will have a decisive impact on the outcome of the election gives most voters a strong incentive to be “rationally ignorant” of political issues and in evaluating the information they do Did a poor job studying. The issue affects voters across the political spectrum.
It’s also worth noting that public ignorance doesn’t just affect voters’ decisions between available options, as it did this year between Biden and Trump. It can also affect the quality of the options themselves. If parties face a more knowledgeable and discerning electorate, they will have an incentive to nominate better candidates, choose better policies, or both.
Instead, parties and candidates exploit popular ignorance to gain electoral advantage. Trump did so on a massive scale, playing a key role in his rise to power in 2016. Such deception.
There are no quick and easy solutions to the problem of ignorance. In my opinion, the best way to address widespread ignorance and bias among voters is to get people to make more decisions by “voting with their feet” and less at the ballot box. Voters on foot are more motivated to seek out information and evaluate it objectively than voters at the ballot box. I review the pros and cons of other possible solutions in my book Democracy and political ignorance And in this recent article.
Unfortunately, we are unlikely to make significant progress in curbing political ignorance in time for the 2024 election. But maybe we can at least raise awareness of the problem, which might make it easier to fix it in the future.
