US election: It's not (just) about the economy, stupid

Analysis - In 1992 James Carville, Bill Clinton's lead strategist, hung a sign on the wall of the Democratic candidate's campaign office in Little Rock, Arkansas. It had three lines on it to focus the team on the key vote-swinging issues and one of those lines would become so famous it's turned into a political cliché.

The line read, 'It's the economy, stupid.'

It stuck for good reason. Elections are almost always about the economy. It's atop most of the polls asking voters their main issue for the 2024 US presidential election as well. Just perhaps not in a way you think.

We'll get to that shortly because it's the point of this column. But first let's just be clear why the economy matters so much. Take a look at this chart recently released by Gallup.

As you can see, if people lack confidence in the economy, incumbents are punished. Any politician knows economic confidence and election wins go hand-in-hand, and if Kamala Harris loses, one of the main reasons will be her failure to sell a clear economic recovery plan and the image many voters have of Trump as a top politicians, rammed home by his name-heavy real estate business and as he climbed off that helicopter and fired people week after week in his top-rating reality TV show, The Apprentice.

But what is the actual state of the US economy and why do so many Americans lack confidence in it? Well, the aftermath of the Covid pandemic, Russia's invasion of Ukraine and the slowing of China's economy (amongst other things) have meant high prices around the world in the past few years, including in America. Inflation peaked at a 40-year high of 9.1 percent in 2022, even though it's back down to 2.4 percent and annual growth is back to 2.8 percent. Petrol prices are easing from $5 highs, but are stubbornly holding above $3/gallon contrary to forecasts. Unemployment is 4.1 percent.

These could be winning statistics in most election years, but Americans are coming off an extreme few years. That 9 percent inflation meant prices overall are up nearly 20 percent since Joe Biden became president. Unemployment had passed 14 percent in 2022.

All that insecurity is still a fresh memory and incomes haven't caught up with that inflation spike. And most Americans have no sense of the global moment they're caught in; they expect the president to have protected them better.

But that's the surface economic debate and it obscures what many people are really saying when they tell pollsters the economy and the cost of living are their main issues this election. Because here's the rub: I think when many people fret about the economy they're taking the longer view.

It reflects one of the other pieces of advice Carville hung on that Little Rock wall back in 1992. One that's typically forgotten but worth remembering just as much as 'It's the economy, stupid'. That other line? 'Change vs more of the same.'

Ah yes, change. It's a complex one, but I think the politics of it are pretty clear. Many people have lost trust in their public institutions and they are demanding change. In fact they have been since the turn of the century. They're fed up no one's doing nuthin' and this inflation, it's really just the latest in a long line of economic disappointments.

Back in May, The New York Times and Siena polled the battleground states of Arizona, Georgia, Michigan, Nevada, Pennsylvania and Wisconsin.

Overall, a massive 40 percent said they'd prefer a president who "promises to fundamentally change America". Asked if they thought the political and economic system in America needs to change, 55 percent said "the system needs major changes", almost double the 27 percent who backed "minor changes". But guess what? 14 percent said "the system needs to be torn down entirely". Few want the status quo.

At that stage it was a Biden v Trump race and 13 percent said Biden would make "major changes" while 45 percent say Trump would. For many, it almost doesn't matter what the changes are. They just want different. Anything but 'more of the same'.

Many people, especially middle-aged and older middle- and working-class people who have seen their way of life and financial options deteriorate over a generation or two, are feeling less wealthy, more alienated and disrespected. Which is bad news for any incumbent.

And it backs up another piece of data I saw at a talk this week by University of Glasgow politics professor Chris Carman. He pointed to research showing that in 1980 white men without a college degree earned around 10 percent above the average full-time income.

But as Asians, women, Black, and Hispanics have all seen their income get closer to, or surpass the average, those white men without a college education now earn around 10 percent below the average income.

Their role as breadwinner, their status and pride, their ability to own a home and provide for their family and hold their head up high, has been eroded. And the Democrats seem to have lost their ability to talk to them and their working/middle class families.

Is it any wonder then that they respond to a politician such as Trump, who sounds like them, reflects their frustration, and wants to get things back to when their America was great? Is it any wonder they get so angry about immigration and trade deals because, while it's not as simple as Trump makes it sounds, it's pretty orthodox economics to say high immigration levels do suppress wages, especially in lower paying jobs.

Is it any wonder they lash out at "change" in all its forms when they're on the losing side, while also wanting more change so that they can find their feet again? To my mind, the culture wars and the economic wars are deeply intertwined.

Don't get me wrong, there is a deep strain of prejudice in parts of the US, a conservative form of Christianity that asks for a disproportionate focus on abortion and sexuality, and a level of mis- and disinformation that runs mind-bogglingly deep.

But at the heart of the election and the polls showing the economy as far and away the biggest issue, is generations of social and economic change that has left too many people behind. There's a loss of trust in public institutions and a sense of hopelessness that means too many are comfortable that democracy is on the ballot this election; because they feel so betrayed, they want to burn the whole thing down.

If Trump wins, the disillusioned and bitter may get their way. If Harris wins, she will have the deep-seated challenge of living up to her promise to be the president for all. Of actually doing something about the cause of her country's polarisation rather than the symptoms.

Because you'd really have to be stupid not to see that we are running out of time to save the idea of America and the strong, hopeful middle class that sustains it.

* This article originally appeared on Pundit.

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