Paul Krugman examines the details.
Rising prices have certainly eroded many workers’ wage gains, although real personal income per capita is still above its prepandemic level even though the government is no longer handing out lots of money. And my sense is that inflation has a corrosive effect on confidence even when incomes are keeping up, because it creates the perception that things are out of control.
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Republicans say, bizarrely, that current economic conditions are much worse than they were in March 2009, when the economy was losing 800,000 jobs a month.
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ask people how their current financial situation compares with five years earlier; 63 percent say they’re better off, the same number as in September 1984, just before Ronald Reagan won an electoral landslide with claims that it was “morning in America.”
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If consumers are really as depressed as the sentiment numbers say, why are retail sales running so high?
And if we turn our attention from consumers to businesses, what we see is a huge surge in capital expenditures. That is, businesses are investing as if they see a booming economy and expect the boom to continue.
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In short, the public’s highly negative assessment of the economy is at odds with every other indicator I can think of.
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Two-thirds of Republicans believe that the 2020 election was stolen; how much of a stretch is it for them also to believe that the Biden economy is terrible, whatever their personal experience?
This is actually a very good economy, albeit with some problems. Don’t let the doomsayers tell you otherwise.
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