“No TV, no radio, no streaming, no social media (text or video), no newspapers, no magazines, few friends. A misanthrope who reads old books, but refuses to engage with headlines at the checkout counter, or chyrons in places like airports and gyms where televisions are forced upon the public.”
All true, and in the objective world of experience and short term memory--a big surge of inflation after 14 yrs of low-to-no inflation (under Biden in 2021 from 2023) or seeing a few people you know suddenly losing their jobs & houses (under Bush, Sr. from 1990 - 1991) can feel like the initial stages of an economic collapse/failure. If the Dems really want to get ahead of the curve and build an economic narrative for the remainder of 2026 and for 2028, they should be 1) Blaming high interest rates on Trump GOP corruption and over-spending on defense and Trump's wars, 2) A weak jobs market & slow wage growth on Trump & the GOP's slavish promotion & support of tech bro AI [job replacement] and various Trump 2.0 anti-worker and anti-union policies and 3) Start explaining to the public how anti-immigration/immigration policies are already undermining short and long term economic growth in the US, worsening the housing shortage (so flip the bogus GOP talking point on the impact of immigration on US housing supply) and substantially undercutting federal tax revenue and funding for Social Security and Medicare.
Also, look at that chart again, a CPI of 3.3% in 1972 was preceded by elevated CPI reaching 5.8% in 1970 likely due to spending related to Vietnam*. The focus on the Carter "stagflation" period in the late 70s is understandable given a) how bad inflation and economic conditions got generally b) how important it was to the "Regan revolution" to come. But what gets lost in the discourse is that inflation had been elevated for an entire decade by the time 1983 rolled around. And you could argue that inflation was elevated for 15 years by that point. In fact, if I'm not mistaken, this is one of the reasons cited as to why inflation got so out of control by 1979 and why Paul Volker had to push interest rates to an extreme number in response; inflation expectations had become imbedded and was creating a self fulfilling prophecy.
So the reason Reagan was able to run on "Morning in America" despite objectively still kind of high inflation is in comparison to the previous 10 years, inflation was so so much lower. It's all about the directionality. Same thing today. Look at those CPI print outs from the 90s, 2000s all the way to 2021; the highest CPI yearly inflation rate from 1992 (Clinton's election) to 2022 was 3.8% in 2008 (and we know what happened after that). The 8.0% inflation rate in 2022 wasn't just the highest it had been for decades, it was the highest by miles. I can't emphasize enough how much Americans lived experience had become attuned to basically no inflation. So while I agree with Krugman that part of the story is people actually believed Trump's promise to literally bring down prices (a promise an even competent Trump would have no hope of keeping), it can't be emphasize enough how much our current period seems such an anathema to huge swaths of the public.
By the way. One reason why inflation is so damaging? It effects EVERYBODY. Your fictional "Ted" absolutely sees higher prices at his local grocery store and CVS. Even if he's cut himself off from the world.
Last thing I'll say. We recognize this with unemployment. There is a lot of literature that what matters is the direction of unemployment not the rate itself. Unemployment was still around 7-8% in 2012, but it had been coming down from 10%. If I'm not mistaken, there's decent evidence to suggest that if the election was held in the summer of 1936 instead of the fall, FDR may have lost but since unemployment was coming down by the Fall (while still horrendously elevated) he won.
One thing I could add is that back in the 70s people were not nearly as financially stressed by the cost of housing, healthcare, and college as they were in 2021 when the post-Covid inflation rolled around.
Also, in the beginning of Biden’s term there was the child tax credit. That was very popular but limited to 1 year. As soon as it ended (pissing people off a little) then the inflation kicked in pissing people off a lot.
Read that again and read the relevant section I sent in a link. That means the median American even absent inflation was literally not just financially better off in 2020 and 2021, but by a sizable margin. Then add in a) inflation b) the loss of the child income tax credit and boy oh boy is this a recipe for a lot of the poor consumer sentiment we're seeing now*
The housing one is a funny one. One of things the "actually Americans are better off today than 40 years go" people (and I should add, this is objectively true) note about housing is a) the cost of financing a mortgage has dropped considerably (for all the talk about how high interest rates are on a 30 year mortgage, check out where they were in the 70s) b) our houses are much bigger. Again both true. But what this leaves out is that in cities with the worst NIMBY problems (which importantly are disproportionately our most economically productive cities), due to huge increase in house prices, you're down payment costs have skyrocketed beyond normal inflation rate (I find it absolutely bizarre this is left out of the discourse) and it's not all that clear that having a bigger house really makes you better off. As in, going from a cramped one bedroom to a house where everyone has their own room definitely an upgrade people notice. Going from a house where everyone has their own room, to a house where everyone's room is a bit bigger? Not really sure how much that's improving happiness.
This I think is recognized when it comes to smartphones given how much it seems to be part of the "loneliness" epidemic and young people supposedly not dating. But I think we underrate how much the extra stuff we can afford today in general is making us happier (honestly how much happier are you with a slightly bigger truck then the last one you had).
* There is a lot of discourse now as to whether Trump would have won in 2020 absent COVID. I'm firmly in the camp of Trump putting his name on Stimulus checks actually as underrated reason he came closer to winning in 2020.
Sadly, propaganda, mis and disinformation are widespread and work very well. The fact that a majority of it comes from the right makes it easier to understand why fear, anger, hatred are infecting the population at alarming rates.
With AI becoming more prevalent it’s all going to get worse. Even if people want to know where to go to find real, factual information it’s difficult to do so.
“No TV, no radio, no streaming, no social media (text or video), no newspapers, no magazines, few friends. A misanthrope who reads old books, but refuses to engage with headlines at the checkout counter, or chyrons in places like airports and gyms where televisions are forced upon the public.”
Where do I sign up?
All true, and in the objective world of experience and short term memory--a big surge of inflation after 14 yrs of low-to-no inflation (under Biden in 2021 from 2023) or seeing a few people you know suddenly losing their jobs & houses (under Bush, Sr. from 1990 - 1991) can feel like the initial stages of an economic collapse/failure. If the Dems really want to get ahead of the curve and build an economic narrative for the remainder of 2026 and for 2028, they should be 1) Blaming high interest rates on Trump GOP corruption and over-spending on defense and Trump's wars, 2) A weak jobs market & slow wage growth on Trump & the GOP's slavish promotion & support of tech bro AI [job replacement] and various Trump 2.0 anti-worker and anti-union policies and 3) Start explaining to the public how anti-immigration/immigration policies are already undermining short and long term economic growth in the US, worsening the housing shortage (so flip the bogus GOP talking point on the impact of immigration on US housing supply) and substantially undercutting federal tax revenue and funding for Social Security and Medicare.
In 1983 and 1984, the annual CPI was 3.2% and 4.3% respectively. At first blush, that 4.3% seems pretty high compared to where CPI has been 1990s to 2022. How did Reagan then win with "Morning in America"? Because 3.2% and 4.3% CPI was the lowest CPI readings for a decade. https://www.minneapolisfed.org/about-us/monetary-policy/inflation-calculator/consumer-price-index-1913-
Also, look at that chart again, a CPI of 3.3% in 1972 was preceded by elevated CPI reaching 5.8% in 1970 likely due to spending related to Vietnam*. The focus on the Carter "stagflation" period in the late 70s is understandable given a) how bad inflation and economic conditions got generally b) how important it was to the "Regan revolution" to come. But what gets lost in the discourse is that inflation had been elevated for an entire decade by the time 1983 rolled around. And you could argue that inflation was elevated for 15 years by that point. In fact, if I'm not mistaken, this is one of the reasons cited as to why inflation got so out of control by 1979 and why Paul Volker had to push interest rates to an extreme number in response; inflation expectations had become imbedded and was creating a self fulfilling prophecy.
So the reason Reagan was able to run on "Morning in America" despite objectively still kind of high inflation is in comparison to the previous 10 years, inflation was so so much lower. It's all about the directionality. Same thing today. Look at those CPI print outs from the 90s, 2000s all the way to 2021; the highest CPI yearly inflation rate from 1992 (Clinton's election) to 2022 was 3.8% in 2008 (and we know what happened after that). The 8.0% inflation rate in 2022 wasn't just the highest it had been for decades, it was the highest by miles. I can't emphasize enough how much Americans lived experience had become attuned to basically no inflation. So while I agree with Krugman that part of the story is people actually believed Trump's promise to literally bring down prices (a promise an even competent Trump would have no hope of keeping), it can't be emphasize enough how much our current period seems such an anathema to huge swaths of the public.
By the way. One reason why inflation is so damaging? It effects EVERYBODY. Your fictional "Ted" absolutely sees higher prices at his local grocery store and CVS. Even if he's cut himself off from the world.
Last thing I'll say. We recognize this with unemployment. There is a lot of literature that what matters is the direction of unemployment not the rate itself. Unemployment was still around 7-8% in 2012, but it had been coming down from 10%. If I'm not mistaken, there's decent evidence to suggest that if the election was held in the summer of 1936 instead of the fall, FDR may have lost but since unemployment was coming down by the Fall (while still horrendously elevated) he won.
One thing I could add is that back in the 70s people were not nearly as financially stressed by the cost of housing, healthcare, and college as they were in 2021 when the post-Covid inflation rolled around.
Also, in the beginning of Biden’s term there was the child tax credit. That was very popular but limited to 1 year. As soon as it ended (pissing people off a little) then the inflation kicked in pissing people off a lot.
The last one brings up something Brian brought up on the podcast today but I don't think he emphasized really enough; a majority of the American public was literally getting more money from the government from March, 2020 to Spring, 2022 than they were getting from their jobs. https://www.frbsf.org/research-and-insights/publications/economic-letter/2020/09/did-600-dollar-unemployment-supplement-discourage-work/#:~:text=relief%20and%20stimulus.-,UI%20benefit%20amounts%20in%20the%20CARES%20Act,which%20typically%20average%20about%2050%25.
Read that again and read the relevant section I sent in a link. That means the median American even absent inflation was literally not just financially better off in 2020 and 2021, but by a sizable margin. Then add in a) inflation b) the loss of the child income tax credit and boy oh boy is this a recipe for a lot of the poor consumer sentiment we're seeing now*
The housing one is a funny one. One of things the "actually Americans are better off today than 40 years go" people (and I should add, this is objectively true) note about housing is a) the cost of financing a mortgage has dropped considerably (for all the talk about how high interest rates are on a 30 year mortgage, check out where they were in the 70s) b) our houses are much bigger. Again both true. But what this leaves out is that in cities with the worst NIMBY problems (which importantly are disproportionately our most economically productive cities), due to huge increase in house prices, you're down payment costs have skyrocketed beyond normal inflation rate (I find it absolutely bizarre this is left out of the discourse) and it's not all that clear that having a bigger house really makes you better off. As in, going from a cramped one bedroom to a house where everyone has their own room definitely an upgrade people notice. Going from a house where everyone has their own room, to a house where everyone's room is a bit bigger? Not really sure how much that's improving happiness.
This I think is recognized when it comes to smartphones given how much it seems to be part of the "loneliness" epidemic and young people supposedly not dating. But I think we underrate how much the extra stuff we can afford today in general is making us happier (honestly how much happier are you with a slightly bigger truck then the last one you had).
* There is a lot of discourse now as to whether Trump would have won in 2020 absent COVID. I'm firmly in the camp of Trump putting his name on Stimulus checks actually as underrated reason he came closer to winning in 2020.
I aspire to be Ted.
Sadly, propaganda, mis and disinformation are widespread and work very well. The fact that a majority of it comes from the right makes it easier to understand why fear, anger, hatred are infecting the population at alarming rates.
With AI becoming more prevalent it’s all going to get worse. Even if people want to know where to go to find real, factual information it’s difficult to do so.
I thought I was reading Krugman, and then looked up.....nice job. Unfortunately, there are too many "Teds"
Idk I kinda feel like we could use a few more Teds.
"Short for 'unmedia-Ted'"
Until I saw the footnote I was expecting a Ted Kaczynski reference.