Can Kamala Harris ditch the inflation boogeyman? - The Boston Globe (2024)

On Wednesday, the Democrat released an 80-page compendium of economic policies, featuring promises to cut taxes for the middle class, lower the cost of living, give a boost to small businesses, and ensure the country stays ahead of China in advanced technologies like semiconductors and artificial intelligence.

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The number of undecided voters in swing states who will read it is, well, not enough to swing the election either way. Instead, the pivotal question is whether still-persuadable voters are in the mood to forgive the vice president for the lingering pain of soaring prices during the Biden administration. “It’s inflation, stupid” is how Clinton campaign strategist James Carville would tweak his 1992 admonition for Harris.

The latest: Recent polls show Harris has narrowed the lead that Donald Trump held on “economic trust” when President Biden was the nominee.

  • A Morning Consult poll released last week found Harris tied with her Republican challenger on the issue.
  • “Voters are beginning to give [Harris] the benefit of the doubt — and that’s really significant,” Frank Luntz, a longtime GOP pollster, told The Washington Post.

The numbers: Some highly visible economic signs are positive for Harris.

The Consumer Price Index, a widely followed inflation gauge, rose at an annualized 2.5 percent rate in August, compared with 3.7 percent a year earlier. Inflation, fueled by pandemic disruptions and government stimulus spending, peaked at 9.1 percent in June 2022.

  • Gasoline prices are falling, down almost 4 percent over the past month, and 16 percent over the past year, to a national average of $3.22 a gallon for regular, according to AAA.
  • Food prices are rising at a much slower pace. The CPI’s monthly food index has climbed an average of 2.2 percent this year after surging 5.8 percent in 2023.

Mortgages are getting cheaper, with the average rate on a 30-year fixed loan dropping below 6.2 percent from 7.5 percent over the past year, data from Mortgage Daily News show.

Stock prices are trading near record highs. The Standard & Poor’s 500 Index and tech-heavy Nasdaq have surged 20 percent this year.

Why it matters: Democrats’ prospects have improved since Harris replaced Biden on the ticket in July. Though the race is too close to call, the vice president has gained traction by highlighting her middle-class upbringing and arguing that Trump’s policies would give tax breaks to corporations and the wealthy while raising prices on consumers with higher tariffs on imported goods.

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  • “For Donald Trump, our economy works best if it works for those who own the big skyscrapers, not those who actually build them, not those who wire them, not those who mop the floors,” Harris said in a campaign speech in Pittsburgh on Wednesday.

Caveats: Cracks are appearing in the economy.

  • Job growth is slowing and unemployment has crept up to 4.2 percent from a low of 3.4 percent at the start of last year, though it remains low by historical standards.
  • Consumer prices are about one-fifth higher than when Biden took office.
  • House prices and rents continue to rise faster than overall inflation.

“Personal savings are down, credit card debt is up, small-business optimism is at a record-low, and people are struggling to afford homes, groceries, and gas,” the Trump campaign said in a statement in response to Harris’s speech.

Final thought: The economy, like beauty, is in the eye of the beholder.

Consider that gross domestic product — the broadest measure of economic growth — is plugging ahead at an annual pace of about 2.5 percent, the average over the past 30 years. The probability of a recession in the next year is 30 percent, according to a survey of forecasters by Bloomberg, compared with 50 percent in January and as high as 65 percent last year.

  • Yet 33 percent of voters believe the country is already in recession, according to the Morning Consult poll released last week.

Obviously partisanship is a factor.

  • Fifty-one percent of voters who back Kamala Harris for president called the economy excellent or good in a recent Economist/YouGov survey, compared with just 5 percent of voters who support Donald Trump.

Harris has less than six weeks to persuade voters to put inflation in the past and give her the opportunity to take the country into the future.

Larry Edelman can be reached at larry.edelman@globe.com.

Can Kamala Harris ditch the inflation boogeyman? - The Boston Globe (2024)

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