Consumer prices fell in December. Likewise, the University of Michigan's consumer sentiment index rose in preliminary data this month to 64.6—its highest level in a year and an 8.2% increase since December.
Economists had expected something closer to 60.5, according to CNN. And one of the biggest bumps came specifically in consumers' estimation of the economy, which rose 15.5% from December.
Let's recall that back in November, public opinion about the economy was pretty bad—so bad, in fact, that 75% of of Americans thought the economy was in a recession, according to a CNN survey. It wasn't, but you get the picture.
As New York Times columnist Paul Krugman noted Monday, the very oversimplified but often telling "misery index" has also dropped considerably since last year. The misery index is calculated by adding up the unemployment and inflation rates—higher being worse and lower being better.
"It has fallen off a cliff," Krugman wrote. "If we use the inflation rate over the past six months, the misery index, which stood at 14 as recently as June, is now down to 5.4, or about what it was on the eve of the pandemic, when Donald Trump confidently expected a strong economy to guarantee his re-election."
Krugman hypothesized that consumers may not have felt as badly about the economy last fall as the polling suggested, partly because Republican voters may have been responding more readily to surveys than Democrats.
Whatever the case, in the last several months, Civiqs tracking on how consumers rate the national economy also shows “very bad” declining a handful of points to 39% as both “fairly good” and “fairly bad” increase to 26% and 28% respectively. It’s slow-but-steady progress.
If the current trends hold, by this time next year, it's quite possible that inflation will be much more manageable, the job market will be strong, and unemployment will be relatively low.
That would be an amazing success story that Democrats should already be starting to preview. Poll after poll last year showed that voters continue to trust Republicans more than Democrats when it comes to the economy. It’s a completely outdated perception that has hung around for decades.
This year could provide the perfect opportunity for Democrats to continually note that things are looking up, inflation is falling, and although the country isn't where it needs to be yet, it is heading in the right direction. Democrats should also be reinforcing why it's heading in the right direction before Republicans try to take credit for it.
Democrats passed the Inflation Reduction Act, bolstered businesses, made job-producing investments in American manufacturing, reduced health care costs, and generally helped consumers through tough times.
Those were all Democratic policies, most of which were passed by Democrats alone.
If Democrats want to hold on to high-propensity suburban voters, they must chip away at the false notion that Republicans are better for the economy. It’s simply not true. But however unfounded the assumption, it's still a stubborn belief among a majority of voters that Democrats must knock down. And they cannot do so by taking a wait-and-see approach. Democrats must start plugging their accomplishments early and often.
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