Source: Niskanen Center
by Ed Dolan
“In 1970 everyone was feeling bad about the economy. How bad? To put a number to the pervasively negative vibe, Arthur Okun created the ‘misery index:’ the sum of inflation and unemployment rates. But now everyone is puzzled. Why was the economic vibe of 2024 bad enough to get the Democrats thrown out of office? After all, Okun’s misery index for the quarter leading up to the election stood at just 6.8, which was actually a whisker below its average of 6.9 for the Trump years. What is more, it had been falling almost continuously for nine quarters after peaking in April 2022. … Paul Krugman wrote that for most Americans, the answer to the question, ‘Are you better off than you were four years ago?’ should clearly be, ‘Yes.’ But Krugman ruefully added, ‘for reasons that still remain unclear, many seem disinclined to believe it.’ What went wrong?” (12/12/24)
https://www.niskanencenter.org/could-a-new-misery-index-help-explain-the-election-outcome