"The economy is the No. 1 issue, and it's a problem for the incumbent party because a large number of voters don't believe the economy is doing well at all. The reason it's a problem is clear. History shows it never works to tell unhappy voters that they actually live in a wonderful economy, and research shows that humans are hard-wired to believe what they feel and not what someone else tells them."
"That's reality, but what counts in politics is how voters feel, and most don't feel contented. Consumer sentiment is about 20% below what it was when Trump was sworn in, according to the University of Michigan's long-running survey on that metric. Not everyone is gloomy. "Sentiment surged for consumers with the largest stock portfolios," says Michigan consumer survey director Joanne Hsu, but "it stagnated and remained at dismal levels" for the far more people without stocks."
President Trump publicly portrayed the economy as excellent and claimed to have solved affordability problems, while many voters remain unconvinced. Real economic measures show 2.2% inflation-adjusted GDP growth last year, unemployment at 4.3%, and modest wage gains. Consumer sentiment is roughly 20% below its level at inauguration, with sentiment rising for large-stock-portfolio households but stagnating for those without stocks. The perception gap stems from human tendencies to focus on and remember bad news more than good. Those negative perceptions have significant political consequences because unhappy voters rarely accept reassurances about economic wellbeing.
Read at Fortune
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