Vice President Kamala Harris lost the race for the presidency on Tuesday because the American people are not satisfied with the economy. According to an NBC News exit poll, 31% of voters cited the economy as their top issue.
While President Joe Biden has overseen the economy for the past four years, Harris, in winning his position on the Democratic ticket, has embraced his dire economic situation.
In a way, that should have been a blessing. After all, by most metrics, the economy has been quite strong. America’s gross domestic product has grown every year since 2020, when the COVID-19 pandemic hit the United States. Unemployment fell below 5% in 2021 and has remained there ever since. The stock market has grown steadily while the US dollar has remained stable against other major currencies.
And while inflation has picked up—making everything in the American economy pricier—for most Americans, wage growth has outpaced inflation for more than two years.
However, inflation was really bad. Inflation remained at just 1.4% in 2020, but jumped to 7% in 2021 and 6.5% in 2022 before retreating back to the world—3.4% and 2.4% in the last two years, respectively. That’s the worst since the late 1970s and early 1980s, there stagflation it was the time of day.
To put it another way: $100 in January 2021 money had the same purchasing power as $120 in September 2024 money, according to the government’s inflation calculator.
But that inflation is due to the pandemic, an initial response that was orchestrated by former President Donald Trump—not Biden, not Harris. Trump championed the CARES Act, which among other things put stimulus checks in place for Americans. That may have been a necessary step at the time, but it also directly fueled inflation.
The biggest failure of the Biden-Harris administration was not in their efforts to control inflation, but in their inability to communicate that once-in-a-generation crisis to the American people. According to a CNN exit poll, 74% of Trump voters said inflation caused them “a lot of trouble” last year—compared to only 24% of Harris voters who said the same.
And while Biden was able to slow down monetary policy and stimulate economic growth, Trump could reverse that progress. Sure, the stock market is surging today on news of Trump’s return to the White House, but that’s because companies believe he will introduce a laissez-faire regulatory regime that will directly benefit them.
But Trump’s plans include deporting more undocumented immigrants and imposing tariffs on US businesses that sell abroad, particularly to China. He has promised to cut taxes on corporations and the super-rich, part of a plan that economists estimate could mean about $8 billion in public debt over the next decade. And if Trump’s policies fuel inflation by imposing higher costs on businesses, then the Federal Reserve may not continue to cut interest rates, making it harder for people to buy homes.
Americans voted because they were dissatisfied with the economy. Biden and Harris could not convince them that they would be a better solution for their pockets. Now, the next four years may put voters in an even worse situation.
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