Donald Trump

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Higher

Most American voters don’t know enough about their economy to make decisions based on it. The gap between what voters think and what economists know is as wide as ever.
Donald Trump and Kamala Harris propose policies that sound good to voters but don’t make economic sense. And economists are baffled by the public’s support for either.
Take Trump’s proposal to stop taxing tips for service workers. Voters love it. About four-fifths of them support it.&nbsp;
But 87% of economists <a href="https://www.wsj.com/economy/trump-harris-policies-economists-vs-voters-176c1407?mod=economy_lead_pos1" rel="noopener noreferrer nofollow" target="_blank">surveyed </a>by the Wall Street Journal think it’s a terrible idea.&nbsp;
They say it would only benefit a small group of low-wage workers, mess up the labor market, blow a hole in the budget, and create loopholes for cheating.
<h3 id="b-tariffs-and-voter-support-b">Tariffs and voter support</h3>
Then there’s Trump’s plan for across-the-board tariffs of up to 20% on imported goods. Nearly half of the voters support this, but every single economist asked—100%—opposes it.&nbsp;
They know tariffs just make things more expensive and hurt industries that rely on imports.
Steven Kaplan, one of the economists, explained it simply: if you put a tariff on something like steel, you make everything that uses steel more expensive.&nbsp;
And that makes those businesses less competitive.
Economics, according to the American Economic Association, is about how people use resources, respond to incentives, and make decisions.&nbsp;
Economists use data and models to figure out if policies make us better off. But none of that matters to voters who just want policies that sound good.&nbsp;
Edward Glaeser, an economist, admits he and his colleagues have failed to educate Americans on economic basics.
Eric Maskin blames politicians too. They know better but still push bad policies to win votes.
<h3 id="b-price-gouging-and-economic-reality-b">Price gouging and economic reality</h3>
One of Kamala’s most popular ideas is banning corporate price gouging for food and groceries. Voters love it. The margin of support is huge—49 percentage points.
But two-thirds of economists disagree. Only 13% support the idea.&nbsp;
Why? William Nordhaus, a Nobel-winning economist, says “price gouging” is too vague to be useful. If you try to regulate prices too much, it messes with the market.
History shows that when governments try to control prices, it never ends well. Higher prices actually help balance supply and demand.&nbsp;
They encourage more supply when it’s needed and lower demand when it’s too high. That’s just basic economics.
There are some policies that voters and economists agree on. For instance, capping insulin prices at $35. Voters support it, and 64% of economists do too.&nbsp;
Kenneth Judd said that while he’s usually against price caps, insulin is an exception. It’s an essential drug, and recent price hikes were unjustified.
But Kamala’s proposal to give first-time homebuyers $25,000 for a down payment? Both voters and economists say no.&nbsp;
Economists argue it would only increase demand without fixing the low supply. It would help a small group while making homes more expensive for everyone else.
<h3 id="b-where-economists-see-value-b">Where economists see value</h3>
Some of Kamala’s ideas do have economists’ support. A $6,000 tax credit for families with newborns? Economists like it.&nbsp;
Reversing Trump’s corporate tax cuts and raising the corporate tax rate from 21% to 28%? Economists say it makes sense. Some taxes might be too high, but on average, they’re too low.
It’s ironic that both Trump and Kamala studied economics in college. Trump graduated from the University of Pennsylvania in 1968, and Kamala graduated from Howard University in 1986.&nbsp;
But it’s actually no surprise. Politicians propose what the public likes, even if it’s bad economics. Trump’s simplistic solutions push Kamala and others to do the same.&nbsp;
The real problem is the growing distrust in economists. The public doesn’t believe them anymore. The American public, they’re unhappy with stuff. And it’s easy for politicians to take advantage of that.
<h3 id="b-a-confused-nation-b">A confused nation</h3>
Polling data shows us a confused public. NBC News has Kamala leading Trump by 5 percentage points, meaning the voters are starting to trust her more on economic issues.&nbsp;
But a Redfield &amp; Wilton Strategies survey shows a tight race.&nbsp;
In swing states, 44% favor Trump for managing the economy, while 41% lean towards Kamala.&nbsp;
A CNBC Fed Survey found that 56% of economists and investment managers believe Trump would be better for the stock market.&nbsp;
But they’re split on who would be better for the overall economy. Here, 44% back Trump, and 41% support Kamala.&nbsp;
For long-term national interests, though, 52% think Kamala would be better, compared to 37% for Trump.
In any case, for now, voters seem to be making decisions based on feelings, not facts. And that’s a dangerous place to be for any country. Let alone the most powerful one on the planet.

American voters don’t understand the economy enough to make a decision based on it

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