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The ‘it’s inflation, silly’ thesis is robust. As MainFT highlighted in a big piece days earlier than the vote and again on election day. Inflation was clearly having a significant impact on Kamala Harris’s likelihood of being elected.
However an evaluation of geographically granular US inflation and the precise election outcomes means that inflation didn’t have a simple impact on the swing to Trump.
If it did, locations which suffered greater inflation would have been extra more likely to see elevated Trump share of the vote over 2020. This isn’t what the information exhibits, nonetheless.
Cumulative CPI inflation since 2020 on the metropolitan space — essentially the most granular measure of inflation launched by the Bureau of Labor Statistics — shouldn’t be related to the 2024 Trump swing.
As a substitute, there’s a slight unfavourable relationship: cities which noticed greater inflation skilled smaller swings to Trump.
The image modifications if you as an alternative plot cumulative CPI in opposition to Trump’s vote share. Right here, there’s a transparent constructive affiliation — cities that noticed greater inflation additionally noticed a better vote share for Trump in 2024.
However the identical relationship holds for Trump’s 2020 vote share, when he misplaced to Joe Biden.
Granted, the pattern measurement is small. We solely have each CPI knowledge and voting outcomes for 21 metropolitan areas.
A bigger pattern comes from the Bureau of Financial Evaluation, which releases implied inflation charges for over 300 metro areas within the US, albeit with a very long time delay (the newest knowledge is for 2022, when inflation peaked within the US).
Simply as with CPI, cumulative PCE inflation by metro space exhibits no relationship with the Trump swing, and there’s additionally no relationship with Trump’s vote share in 2024.
That is puzzling. Exit polls and pre-election surveys present inflation was a significant concern, and academic evidence is evident that individuals really hate inflation and have a tendency accountable the federal government for greater worth ranges irrespective of who or what is definitely accountable.
So why didn’t areas that noticed greater inflation swing extra to Trump?
It’s not as if variation in inflation throughout areas is insignificant. Inflation variations are remarkably massive — Tampa Bay noticed near 30 per cent cumulative CPI inflation since 2020, practically double that of San Francisco, for instance.
What then? The reply to this puzzle may be that goal, combination inflation — as measured by CPI or PCE on the metropolis or nation stage — is a really completely different factor to each perceived inflation and skilled inflation.
First, on perceptions. Republican voters consumed much more negativity in regards to the US economic system during the last a number of years, and this confirmed up clearly in sentiment.
A survey by Pew forward of the election discovered a 20 proportion level hole in concern round costs between individuals figuring out as Republicans versus Democrats. And research shows that Republicans are more likely accountable the federal government for inflation.
From this standpoint, the path of causality runs within the reverse path: help for Republicans formed views on how dangerous inflation was and who was accountable.
However whereas perceptions may be 9/tenth of actuality, inflation was objectively excessive all around the US.
The opposite level is that combination measures of inflation obscure large differences in inflation experiences by households. All of us have very completely different consumption baskets, and therefore very completely different precise inflation charges.
One notable instance are typical variations in inflation by revenue group. The poorest usually endure the best inflation ache, and the latest episode was no exception — the bottom revenue quintile noticed two proportion factors greater inflation on common since 2019.
Maybe that helps clarify why decrease revenue voters have been extra more likely to vote for Republicans over Democrats at this election, for the primary time in many years.
