High growth doesn’t tell the story of the US economy

BILL Clinton’s election strategist James Carville wanted his 1992 presidential campaign to focus on three simple messages. But one of them has transcended its original context: “It’s the economy, stupid.” What then to make of the decisive swing towards Donald Trump against a backdrop of low unemployment, falling inflation and economic growth rates most of the rich world would envy?

Do voters no longer care about economic performance? Or were they misinformed about how strong the US economy really is under Joe Biden? Or is there another explanation for why the Democrats presided over strong growth, yet lost?

Let’s take these possibilities in turn. Many people are so tribal in their political loyalties that their satisfaction with the economy depends almost entirely on who is in charge. You can see this in the sharp swings in sentiment whenever the presidency changes parties. For many years, it has been the case that when a Democrat is in the White House, registered Democrats are much more confident about the economy than registered Republicans. When a Republican is in charge, that pattern reverses.