Inflation May Have Cost Kamala Harris The White House

Higher consumer prices may be the single biggest contributing factor to the resounding defeat of Vice President Kamala Harris by former president Donald Trump in Tuesday’s presidential election.

Voters have consistently rated the economy as the most important issue in the election, and two-thirds of voters surveyed after casting their ballots said they considered the economy “not so good” or “poor.” And of the 31% of voters who told exit pollsters the economy was their top concern, 79% voted for Trump.

By most measures, the economy is doing well ― unemployment is historically low, at 4.1%, the stock market is booming, the country’s gross domestic product remains the envy of the world, and inflation has actually fallen to similar levels in Trump’s first term.

The trouble is, inflation falling doesn’t mean prices are falling ― it just means they’re not going up as fast. And people hate high prices.

“Consumers have absolutely noticed that inflation has slowed down, but they remain very, very frustrated by the persistence of high prices,” Joanne Hsu, director of consumer surveys at the University of Michigan, told HuffPost.

The University of Michigan’s index of consumer sentiment in October was 10 points higher than it was two years prior but still 11 points lower than it was even in October 2020, when the coronavirus pandemic had upended daily life across the country. And the most recent measure of sentiment is a whopping 25 points lower than in October 2019.

To be sure, other factors likely contributed to Trump’s victory, especially his vow to stamp out illegal immigration. But Harris’ loss fits a global pattern in which incumbents have been thrown out by electorates, who are still seething over the pandemic and the economic pain it caused.

The U.S. has had a better economic performance than many peer nations. The consumer price index, the government’s main gauge of inflation in the U.S., fell to 2.4% in September, the lowest level since early 2021, after peaking at 9.1% in 2022. And consumers have noticed the slowing of price increases ― it’s just that they’re not impressed.

“The share consumers telling us that high prices are eroding their personal finances, that did not come down at all over the last couple of years, in spite of the fact that consumers, when we ask them about inflation specifically, they’ve definitely noticed how much has slowed down during this period,” Hsu said.

The government’s data on wages, meanwhile, suggests that American workers are actually getting raises that outpace price increases, but that’s not necessarily something workers would credit to anything but their own efforts.

The high inflation of Joe Biden’s presidency resulted primarily from supply chain constraints caused by disruptions related to the pandemic, though economists say big spending by Congress in concert with both the Trump and Biden administrations played a role. Trump, of course, made sure to blame it all on Democrats.

The government’s main efforts to fight inflation are delegated to the Federal Reserve, a central bank that operates independently of the White House, though its leaders are presidential nominees. The Fed uses higher interest rates to increase borrowing costs and push down economic activity ― essentially causing more economic pain to reduce inflation by making people buy less stuff.

Biden and Harris sought to blame inflation partly on big corporations padding their profits by soaking consumers, and Harris said in August that she would champion new efforts to combat “price gouging.” Still, it wasn’t enough to impress voters. Hsu’s research found that voters were more aware of the news about inflation in 2022 than they were even in the 1970s when fast price increases persisted for years.