US voters say fixing the economy is the top priority

US voters say fixing the economy is the top priority

This election season, voters are laser-focused on one big issue: the economy. Americans rank inflation as the most important problem in front of the United States, followed by employment and the general economy, an October Ipsos / Reuters poll found.

In the last year, Americans have aimed to return to eating out, traveling and enjoying in-person events, which became scarce in the early days of the Covid-19 pandemic. But skyrocketing prices for everything from eggs to air fares, as well as uncertainty about the future, put a damper on many of those plans.

Voters may be divided on many issues, but they all seem to agree that money and how government affects it needs to be addressed. When asked what single message voters hope to send politicians with their votes this year, the answers tied for No. 1 are “be more efficient and do more” and “fix the economy and reduce the cost of living.” an NBC News poll found.

With that in mind, here’s a look at three of the main economic problems facing the United States right now.

1. The rising cost of living

The consumer price index sitting comfortably at 40-year highs has frustrated consumers and pinch pennies to beat the end. High prices on essentials like gas and groceries make it hard to find places to cut back.

Workers have seen huge wage gains over the past year, with hourly earnings rose 5% in September from the previous year. However, it is not enough to keep inflation down.

U The increase in the rates of the Federal Reserve aim to control inflation. Meanwhile, voters want to see Congress and the White House intervene.

Change in personal income has historically been one of the most reliable election predictors, says Stephen Ansolabehere, a professor of government at Harvard and an expert in elections and politics.

“Even if incomes increase, inflation decreases in real terms. That’s what hurts the Democrats,” Ansolabehere tells CNBC Make It. “Whether inflation has to do with something the administration has done, it’s not something voters really care about. It’s more about ‘Am I better off?’

2. The imminent possibility of a recession

While the bright spots like low unemployment and a gross domestic product (GDP) recovery show some potential to fight an impending recession, voters and experts do not feel optimistic about avoiding one altogether.

Bloomberg economists have recently pegged the probability that the United States will enter a recession within 12 months at 100% And less than a third of the voters expects the economy to improve next year, according to a CNBC poll.

The layoffs have not spread to the labor market either. all the same, 91% of CEOs expect a recession in the coming year, according to a KPMG survey of 1,325 CEOs between July 12 and August 24, 2022. And 52% of CEOs said conditions in their industries were worse at the start of the fourth quarter, a survey by non-partisan think tank The Conference Board found.

Despite reports that administration officials began to explore recession response plans At the beginning of the month, Biden celebrated the third quarter GDP reports and insisted that the Republicans should try to undermine this progress.

The Fed continues to raise interest rates in its effort to curb inflation, but those rate hikes could plunge the U.S. into a recession if higher borrowing costs dampen demand too much.

Even if the Fed is technically to blame for sending the country into a recession, voters will likely look to their elected leaders for solutions.

3. The volatile stock market

The stock market is not a complete picture of the economy, but its performance certainly matters to voters. Watching their portfolios swell as pandemic recovery efforts take hold, only to fail and remain volatile through 2022, has a lot consumers are rethinking retirement plans and worried about his future.

The stock market will remain up-and-down until there is a clear idea of ​​what the government is doing, Ansolabehere of Harvard says. Tax reform and changes to funding for social programs like food stamps and Medicare can affect consumer budgets and lead to more market uncertainty.

“There are things that Congress should not do, and things that they can do in terms of creating a more stable situation,” says Ansolabehere. “What Wall Street wants is certainty. They want to be able to wait for what Congress is going to do in terms of budgets and taxes.”

Finding that stability could be challenging. If the Democrats lose the House, Congress could prepare another debt ceiling block that could threaten to shut down the government or push the country into default on its debt. The Washington Post reports.

The war in Ukraine, another surge of Covid and climate change could slow or reverse progress toward a full economic recovery, where prices come back down to earth and checking your 401(k) isn’t so heartbreaking. But it is up to the voters to decide who is best to deal with these problems.

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