tiktok, inflation vs jobs, and discontent
The conservative electorate polarized their opinion of the economy to correlate with which party holds the White House roughly when Obama won his first term and is not going to be bothered with facts for the foreseeable future. Democratic Party politicians believe they can’t show unbridled optimism about economic performance because someone, somewhere, has become down on their luck. Also something that will never change.
Beyond that, the media cannot accurately report on the economy both because journalists are generally ignorant and because modest optimism does not generate clicks.
It’s amazing that someone could think Trump would handle the economy better than Biden, and even more amazing it’s by such a big gap. Like one of them is currently being investigated for fraud, and the other is outperforming expectations. But yeah, let’s go with the eventual convict instead of the guy who’s quietly doing his job.
That last bit about the social desirability of criticizing the government is so true. I’m pro-Biden and have to remind people basic principles of US government while they blindly complain. Like he’s not a king, there’s checks and balances to this shit. Also he most definitely is PRO-UNION jfc! Clearly they don’t actually listen to the unions that pick him as the choice for POTUS, or almost every union is wrong about who’s most helpful to them.
It’s just belligerent, blanket skepticism masquerading as intelligence. People think ignorantly pointing out surface-layer flaws means they are smarter than the people working on the issue. When in reality, they just argue in bad faith cause their identity politics have come to represent their actual views on politics. They don’t want solutions, they want a wall that’ll listen and tell how smart and special they are.
Sorry I’m bitter about it. So many political conversations just boil down to ‘everything is capitalism’s fault and we should just start over’. To quote Afrikan Boy from the M.I.A. song ‘Hussel’, “You think it’s tough now?! Come to Africa”.
Great post as always though!
The note about people not believing that inflation has slowed down despite the data being the data makes me wonder how we ever get trust back post-Trump. Might end up being a generational thing, which stinks.
Bless you for talking to folks on the airplane. Thank you for acknowledging the humanity of strangers.
Showing econ love to Ms. Sahm... Love to see it!
In an "industry" so long dominated by men, the two people currently doing the best work to make complex issues understandable to us amateurs are women (you and Claudia). Once again showing that bringing in nontraditional voices often helps move understanding forward in a new way.
Thank you for everything you do!
love the thesis on media's role in economic perception and the state of the world!
our reliance on (social) media and algorithms impact our ability to cultivate intuition about how *we feel* about what's happening in the world – instead, the collective ends up looking to media outlets that are incentivized to paint a narrative that drives clicks and eyeballs. "if it bleeds, it leads"
Another amazing post. I am about to go though it with a fine tooth comb to understand it better, more deeply, and then share everywhere.
I continue to be befuddled that you you don't believe that corporate profit margins (and buybacks-my words) are responsible for inflation (referencing an older post of yours). I am old enough to remember when my credit card had 7% interest in the 80s. At current cc interest rates, it seems like it puts people on the same hamster wheel experienced by student loan debtors with higher balances than the original loan amount borrowed. It seems like there are ways to help consumers (who truly drive the economy) but [excessive] profit continues to be a tremendous roadblock. Or maybe I misunderstood.
As a miscellaneous note: at work (construction), I convinced my boss to not raise prices on our main products for this entire year. So we're absorbing the manufacturer's increases, while concurrently working to get better pay (via bonuses) & more consistent safety conditions for our workers. I call the discount our inflation buster discount. :) I wish everyone in a position to do so would work to bring the community UP.
Thank you for everything you do and inspiring us to try to actively do better. Knowledge is power.
Again and again you’re writing masterpieces that I forward to all my closest friends! Just amazing!
“where virality is a function of saying wrong things loudly” is the best description of the state of social media.
As a personal finance educator and active in Democratic politics, this mismatched perception is so vexing! It’s tough to counter the perception of a bad economy from either angle, but I have had some success just pointing out the facts in response to “vibes” based complaints. I also always bring the conversation back to the corporations — record profits, low wages, etc. How can we elect officials who have a plan to hold them accountable?
I vividly recall moments during my youth where I'd be at home, just me and my mom ... The TV would be on and it would be broadcasting some glorious program, about how "everything going on is So Great!"
At the same time as the TV broadcast, my mom would be crying
Moments like that I was thinking how great could it be if my mom is crying?
Does any of it even actually matter at all if my mom is like that?
That part highlighting the contrast between 'economic data' and 'public perception' ... Economic data as a measurement reflects conditions experienced, so the data can be in a state where it does not capture the full experience (or the parts of the experience that truly matter to people)
When the concept of economic data is all about the ones measuring the data, it isn't particularly relevant to a specific set of individuals who are outside the measuring group
Avocados are affordable ... There are alternatives available, and all the economic stuff going on can be a signal that indicates the necessity of change
I think one thing missed is how everyone’s focus and well being seems to be aimed at the President. Let’s be real - that’s what underpins so much of the tone of the headlines in media. This is the driver of the discourse. And let’s be real - what can Joe Biden do to lower cereal prices? How does Biden reduce rent? Sure, the kids are mad about him not erasing student loans…but he has done A LOT to reduce many folks’ burden, AND legally, he likely can’t just wave a want and erase it all. Folks are going to be similarly mad when Trump is re-elected and nothing changes. (Or maybe then folks will see the same economic data as positive and their lives better…who knows the magic his dude has over a massive swath of the populace)
We (USA) really were (are) consuming too much petrol and - relatedly - paying too little for it. We really consume too much beef/chicken/pork.
Households could re-calibrate expectations and integrate higher inflows of USDs into some consumer-behavior changes that are not only not that onerous, but potentially enrich relationships and appreciation.
Smaller meat portions, one-two days meatless per week/month (and not super-sizing everything).
Living closer to work or to shopping/entertainment destinations. Carpooling. (Rural folk have some extra dependence related to long commutes, and I get why petrol prices ange them. We need to figure out a way to help them transition to more sustainable tech without stepping on their lifestyle prerogatives too much.)
But, yeah. I know....
We're being "worked on" even before the plandemic and debtflation the news was "end of the world" 24/7
The adaptation of climate existentialism to incorporate every weather event and catastrophe propagates anxiety (and shares more than a little with ancient weather cults built around storm gods)
Partisan populism, imposing moral extremes (both ways) only demands rule of law for "the other guy"
And a couple of wars: one seeming to concern thousands of university students while another 1000x larger with possible nuclear engagement is largely shrugged off
Sandy Pentland meant to illustrate the memetic spread of good ideas via social media algorithms with his book "Social Physics" (2014)
It's just so tempting to use it for other purposes? Perhaps 'good idea' is undefinable in the dappled moonlight of human nature.