Overview of It's (still) the economy, stupid
This NPR Politics Podcast episode examines why the economy remains the dominant political issue heading into the midterms. Despite some broadly “okay” macroeconomic data, many voters still feel squeezed by high prices, slow wage growth, and a job market that is stable but not especially dynamic. The hosts and NPR economics correspondent Scott Horsley also dig into how Democrats and Republicans are trying to frame economic anxiety to their advantage.
What the Economy Looks Like Right Now
Growth is positive, but sluggish
- U.S. GDP grew at an annual rate of 1.5% in the spring quarter.
- That means the economy is still expanding, but at a slower pace than earlier in the year and slower than during much of Biden’s presidency.
Inflation is still hurting households
- Inflation remains elevated, with the cost of living rising about 3.5% over the previous 12 months.
- In recent months, prices have been rising faster than wages, reversing a period when paychecks had finally begun to outpace inflation.
- Everyday essentials like groceries and gas are especially painful because they are hard to avoid in family budgets.
The job market is stable, not strong
- Layoffs remain low by historical standards.
- But job creation has slowed, meaning:
- employed people feel relatively secure,
- job seekers and people who lose work are struggling more.
- More than a quarter of unemployed people have been out of work for over six months.
Why Voters Still Feel Bad
- The conversation emphasizes a “K-shaped economy”:
- wealthier households are benefiting from stock market gains and rising home values,
- many other Americans are just treading water.
- Some consumers have been able to keep spending, but much of that resilience appears to come from higher-income households.
- The segment argues that many Americans are not building wealth, especially because:
- homeownership feels out of reach,
- stock market gains do not help people who aren’t invested,
- rising prices make it harder to save or pay down debt.
How Politicians Are Talking About It
Democrats: affordability, housing, and corruption
- Democrats are trying to make the economy an issue of affordability and fairness.
- Their message includes:
- making housing easier to build,
- holding corporations and politicians accountable,
- arguing that corruption and deregulation have made life more expensive.
- Michigan Senate candidate Abdul El-Sayed framed the issue as getting corruption out of politics and putting “money out of politics, money in your pocket.”
Republicans: affordability talk, but few concrete answers
- Republicans are also talking more about affordability, acknowledging voter frustration.
- But the discussion notes that their main proposed fix remains tax cuts, which many voters do not feel have solved day-to-day cost pressures.
- President Trump and Republicans want credit for:
- tax cuts,
- “no tax on tips,”
- state and local tax deduction relief in high-tax states.
Tariffs and Gas Prices
Tariffs are presented as a tax on consumers
- Horsley explains that tariffs are effectively taxes on imported goods.
- The burden usually falls first on U.S. importers and then often on U.S. consumers.
- The Trump administration has reimposed tariffs using a different legal rationale, but the practical effect remains higher costs for businesses and shoppers.
Iran conflict and energy prices
- The hosts note a sharp rise in gas prices after the U.S. went to war with Iran in the segment’s framing.
- That increase matters because fuel costs ripple through the entire economy, raising transportation and shipping costs.
Political Takeaway
- The central political dynamic is anti-incumbent frustration.
- Voters are angry because the promise of the American dream — working hard, buying a home, and getting ahead — feels increasingly out of reach.
- The episode argues that:
- economic indicators may look “fine” on paper,
- but people are reacting to their lived experience,
- and that experience is dominated by high prices and limited upward mobility.
Bottom Line
The economy is not in crisis, but it is not delivering broad-based relief either. That mismatch between the data and how people feel is driving political anger. Democrats are trying to make affordability and corruption central campaign themes, while Republicans are leaning on tax cuts and long-term promises about growth and manufacturing — but neither party has a simple fix for the immediate pain voters are feeling.