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Campaigns with a lot in common
If you view politics in terms of a left-right spectrum — which talking heads generally do, but voters generally don’t — Zohran Mamdani, New York City’s mayor-elect, and Mikie Sherrill, New Jersey’s governor-elect — look quite different. Although Mamdani is not, whatever Republicans say, a Communist, he’s clearly well to Sherrill’s left.
Yet as many observers have noted, in a sense they ran similar campaigns, focusing on the issue of “affordability.” But what does that mean?
Economists tend to equate affordability with “real income” — people’s income divided by a measure of the cost of living. Real income is definitely an important and useful concept, and it’s important to get our facts straight about the changes in Americans’ real income over time. But basing the question of affordability solely on real income is clearly inadequate, both politically and intellectually.
Politically, telling voters not to be upset about the rising cost of living because their incomes are rising even faster — even when it’s true — is a good way to lose elections. As I emphasized in last week’s primer, in times of inflation people tend to believe that they earned their wage gains, only to have price hikes snatch them away. Lecturing them and saying that they shouldn’t feel that way is political malpractice.
But political messaging aside, there are good reasons to believe that real income by itself gives an incomplete picture of what people mean when they talk about affordability. In some important ways the current U.S. economy is worse for workers than it looks according to the most commonly cited economic data.
Moreover, I would argue that three important concepts that are especially poorly captured by standard economic numbers underlie people’s perceptions of affordability: economic inclusion, security, and fairness. By economic inclusion I mean the ability to purchase the goods and services that allow someone to feel like a member in full standing of American society. By security I mean a feeling based not just on current real income, but also an assurance that severe hardship isn’t just a stretch of bad luck away. Lastly I would also argue that perceptions of affordability are often intertwined with perceptions of fairness: people are especially upset about high prices when they feel that they are being taken advantage of.
Affordability, in short, is a big topic, and I’m planning to discuss it in three successive primers.
Beyond today’s paywall I will address the following topics:
· Trends in real incomes
· Why the economy is worse for workers than it looks
· The special problem of unaffordable housing
Next week I’ll talk about economic inclusion, security and fairness. And the following week I’ll conclude with some thoughts about a general affordability agenda for the Democrats...