Our most recent book is titled Divided We Stand: The 2020 Elections and American Politics. Our next book will look at the 2024 election. Objective indicators were doing great. Perceptions, not so much.
On paper, the economy seems OK. Inflation is down recently. Wages are up. But anger persists. That’s because higher prices cause a special kind of pain — one that lingers and, historically, leads voters to punish the people in charge. Tuesday was no exception....
Why does inflation anger voters so much? Some economic problems, like high unemployment, affect only a minority of the population. But higher prices affect everyone.
Inflation also taps into what psychologists call “loss aversion”: People feel negatively about losses much more than they feel positively about gains. So although wages have kept up with inflation or surpassed it, people still feel more pained by sticker shock at the grocery store than elated by their gains.
To make matters worse, consumers can’t do much about inflation. They simply have to cut back their spending on certain things or work more hours to afford them. The sense of loss combined with a feeling of powerlessness leaves people furious. They expect their leaders to fix the problem.
Inflation fell to normal levels over the past year, but high prices remain. Eggs still cost nearly triple what they did four years ago. When people imagine an ideal end to inflation, they think of prices returning to normal. That hasn’t happened, and economists don’t expect it will. When the polling firm Morning Consult surveyed U.S. voters about inflation, they were comparing prices with those from 2020. They blamed President Biden and Harris for the increases since then, fairly or not.
“Americans were comparing this economy to one without inflation, whether or not that was a realistic option according to economists,” said my colleague Ben Casselman, who covers the U.S. economy. “They weren’t saying, ‘Inflation is tough, but at least I have a job thanks to Biden.’ They were saying, ‘Of course I have a job, but now I have to deal with all this inflation thanks to Biden.’”
The same dynamic is haunting leaders all over the world. Over the past few years, voters have thrown out incumbents, on the left and the right, in Britain, France, the Netherlands, Argentina, Italy and Australia. The top political parties in South Africa, Japan and India also faced disappointing elections. Canada’s and Germany’s incumbents are in danger of losing their jobs next year.
