History may not repeat itself, but it often rhymes. Today’s economic news has a familiar rhyme, at least to those old enough to remember the 1970s. Not disco music and leisure suits but the Jimmy Carter presidency.
Carter popularized the phrase “Misery Index”, a simple numeric measure of how the average American is doing economically. It is the sum of the current seasonally adjusted unemployment rate plus the current inflation rate, a simple addition calculation.
Carter used the misery index against incumbent Gerald Ford in the 1976 presidential campaign. Ford presided over an anemic economy and in January 1975, almost two years before the election, the misery index reached 19.9%.
While it dropped to 15% ahead of the election it was high enough for Carter to use it as a winning campaign issue. Another term, “stagflation”, was also popular in the 1970s as a more qualitative measure of economic misery, specifically slow economic growth, and high unemployment.
The media, just like last year, working hard on behalf of the Democrat challenger against a Republican incumbent, popularized these terms to assist Jimmy Carter winning the presidential election.
Karma bit President Carter hard. While the misery index hit almost 20% during the Ford presidency, during the summer of 1980, ahead of the Carter-Reagan election, the index hit almost 22%, leading to Reagan’s 1980 victory.
Although the media has little interest in the misery index today, it is rapidly rising. The US Department of Labor reported last week that the consumer price index rose 4.2% over the past year, the largest gain since 2008. April’s seasonally adjusted civilian unemployment hit 6.1%. Add those two numbers together and get the current misery index of 10.3%.
Can government numbers be believed? If COVID numbers can serve as example, “official numbers” can be elevated or depressed to serve political agendas. COVID case counts were falsely elevated based on unreasonably high PCR cycle threshold numbers used in testing. Erroneously attributing murder-suicide deaths to COVID falsely padded the death counts.
What are some of the inflation figures today according to the Bureau of Labor Statistics? Gasoline is up 51%, bacon 11%, fresh fruits 7%, used cars and trucks 22%, tobacco and smoking products 7%, and airline fares 10%. Lumber prices are 130% more than a year ago.
Perhaps the real inflation number is higher than the reported 4.2%, and with it the misery index. Is the Biden administration doing anything to mitigate either unemployment or inflation? Crushing regulations, proposed taxes, and endless business closures are raising unemployment.
Spending trillions of dollars we don’t have, through “stimulus” bills, leads to too many dollars chasing too few goods, and inflation. In four months, America has gone from energy independence to gas lines.
After four years of making America great again, it’s now time to make America miserable again, resurrecting the misery index to quantitate how economically unhappy Americans are and will be for the foreseeable future.
Will the media talk about the rising misery index, Biden’s blast from the past? Don’t count on it.