Cost of living is top of mind for midterm voters

Key takeaways

Voters are highly concerned about the rising cost of living and economic uncertainty leading into the midterm elections.
Inflation remains above the Federal Reserve’s target, influencing expectations about potential interest rate hikes.
Border controls within the EU, such as Germany’s checks with Poland, slow down trade and undermine the principle of free movement, with significant economic costs.
Economic issues like healthcare, housing, and groceries dominate voter priorities, reflecting widespread economic anxieties and influence on political decisions.

Summary

The Economy and Voter Concerns Heading into the Midterms

This section discusses the prevailing economic anxieties among American voters as the midterm elections approach. A poll by Ipsos and Reuters indicates that 74% of voters believe their personal cost of living is on the wrong track. Additionally, 59% of Americans don't see a good chance for their families to improve their standard of living, emphasizing widespread economic discontent. Key issues include rising prices for gas, groceries, electricity, and rent. The segment highlights how the current war in Iran and conflicts in Canada contribute to economic uncertainty and voter frustration, with approval ratings of the president reflecting discontent over the cost of living. Voters prioritize healthcare, housing, and groceries over energy costs and childcare, and consumer sentiment has declined, especially among Republicans.

Upcoming CPI Data and Federal Reserve Outlook

This part previews the upcoming release of the Consumer Price Index (CPI), which measures inflation by tracking the cost of a basket of goods in urban areas. The CPI is expected to show a 3.4% annual increase, above the Federal Reserve's target of 2%, with core inflation at 2.4%. These figures suggest ongoing inflation pressures and imply that the Fed might consider raising interest rates in its upcoming meeting to curb inflation. The discussion underscores the significance of inflation data in shaping monetary policy.

Border Checks in the European Union and Their Economic Impact

This segment covers Germany's decision to impose border checks at all land crossings and airports with Poland in 2024, as part of efforts to combat undocumented immigration. The checks involve passport and visa verification, leading to delays for trucks, cars, and individuals, and incurring significant costs—around $100 million for German taxpayers in nine months. Experts express concern that these internal border controls undermine the EU's single market, slowing economic activity and complicating the movement of goods and people across borders. Despite reduced crossings, it's unclear whether the controls are solely responsible for the decline, but they certainly add economic and logistical challenges.

Show notes

Less than eight weeks until midterm elections, the economy remains the center of voters' attention. Ipsos and Reuters just released a poll that found 74% of voters think their own cost of living is heading down the wrong track. What’s more, 59% of Americans don’t think their family has a good chance of improving their standard of living. Also on the show: a preview of Friday's consumer price index and the economic impact of Germany's border checks.

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