Trump Voters Don’t Just Expect Higher Inflation—They Get It Too: There has always been a difference between how Republicans and Democrats view the economy. But the gap has gotten bigger. (Justin Lahart, 5/25/24, WSJ)
Inflation estimates provided by Moody’s Analytics, combined with voting data, show that states where Donald Trump garnered the most votes in 2020 have on balance experienced higher inflation.
For example, South Carolina experienced the most inflation of any state since the pandemic hit. Its consumer prices rose at a 4.88% annual rate between December 2019 and last month. South Carolina elected Trump with 56% of the votes cast between him and President Biden in 2020.
In contrast, New Hampshire had the least inflation of any state, with prices rising at a 3.75% rate. It elected Biden with 54% of the Trump/Biden vote.
Just as importantly, Binder and her co-authors found that people in Republican-leaning states were more likely to expect that higher inflation. While feelings might seem superfluous, economists and policymakers widely believe that expectations do matter. If people think more inflation is coming, that can lead to higher inflation in fact.