[Applause.] Both Joe Biden and Donald Trump face challenges in winning over voters. They are historically unpopular. We know that people have been thinking about immigration, about access to Reproductive Rights and abortion. We know that people have been thinking about broader threats to democracy. People are concerned about the age and health of the candidates. And what's happening on the Democratic party side. We also know that voters are obsessed with the economy and things like inflation. And that in 2024, the votes in seven states will matter more than the rest of the United States. Arizona, Georgia, Michigan, North Carolina, Nevada, Pennsylvania, and Wisconsin. We've taken those seven states and put them together into what we call the Battleground economy. Most people want to see economic Prosperity. Do we have sticky inflation? People want to see prices come down. Stakes here, I I think are very high. If we were to view those seven swing States as some sort of autonomous single economy, they would produce about $4.4 trillion dollars in GDP. It's an economy that would be bigger

than Japan. It's an economy that is older and wider, and in some cases poorer than the rest of the United States, and that accounts for about 17% of the US population. They are up for grabs, and the well-being of voters in those seven swing states is of the utmost importance for winning the presidency. Treat respect people. I'll Donald Trump turn the battle Crown economy is made up of seven states that aren't all the same in economic terms, and the thing that really unifies them is politics. You have Sun Belt states that have seen a big increase in population in recent years. You have the states that are called the blue wall, old industrial states like Michigan, Pennsylvania, and Wisconsin. We found that it has been growing even more slowly than the swing states as a whole. It's about 12% of GDP in those swing states is generated by the manufacturing industry. That compares to just about 10% for the rest of the US. The swing states look a bit more 20th century than the rest of the country does by lots of

measures. The US economy is in historically good shape. Unemployment has been at or near record lows. Inflation is coming down. Credit for a lot of that goes to a new embrace of industrial policy that Joe Biden has led in Washington. The two states that have really seen the most growth in manufacturing employment are Arizona, where we're seeing investment in semiconductor fabrication plants, and Nevada, which is a unique story mostly driven by Tesla's battery manufacturing. The US economy is also coming through a historic period of chaos and pain. We saw an incredibly deep recession in 2020. We've seen a rapid recovery from that, but that's also been accompanied by the highest inflation in 40 years. We also have interest rates at 40-year highs. A lot of people have not seen either the inflation or the interest rates that we are seeing now in their lifetime. Nevada, like other Sun Belt states, has been growing incredibly fast, but one of the phenomena you see there is that housing costs have risen faster than they have in the rest of the United

States in 2019 a median household could expect to spend 19% of their monthly income on their mortgage payment. For a median house in Nevada by last year, that had risen to 36% of their monthly income. It's not just poor people; it's middle-class people who feel squeezed as people move into an economy. That economy grows 300,000 more people live in Georgia today than did in even 2020. A lot of that growth has happened in metro Atlanta, but while that population growth has fed a growth in the state economy, that growth has to be shared between more people. This year, Republicans are making a big play for Wisconsin. Between 2019 and 2023 in Real GDP per capita terms, the Wisconsin economy actually shrank by just under 1%. At the same time, you have booming parts like Dane County, which is where Madison sits, the big University Town. The reality is blue C's have done a lot better economically than red counties. One of the main reasons is that a lot more

people are flocking to Blue counties, which tend to be clustered around big cities. Counties that voted for Joe Biden grew by an aggregate of 4.2% in terms of real GDP per capita. Counties that voted for Donald Trump grew by just 0.8%. One of the things a lot of politicians have looked to in the past is something called the misery index, and that simply adds up the level of inflation with the unemployment rate. The unemployment rate has remained low throughout much of President Biden's term in office. The inflation rate has come down from over 9% to under 3.5%, and that makes his misery index look pretty good through time. But polling conducted by Bloomberg News and Morning Consult have shown that voters in all seven swing States trust former president Trump as a steward of the economy more so than President Biden. So we can construct a new index, misery 2.0, and we look at the 4-year cumulative inflation of each president and their average unemployment rate while in office. The role of inflation is really

key here Arizona had the highest misery to index rating of the Swing States because it saw some of the highest price increases in the US. President Biden is on track to have a misery 2.0 index of 25.5. We estimate that cumulative inflation during his term will reach about 21%. That means that about a fifth of voters' purchasing power has been shaved off relative to where they were before he took office. Needless to say, that's not all his responsibility deficit spending first enacted under President Trump and then enacted under President Biden would tend to put upward pressure on interest rates. But the FED stepped in to buy up bonds to suppress interest rates and to facilitate spending when the economy reopened. The result of that fiscal stimulus paired with Rock Bottom interest rates was The Surge of inflation. The caveat to all the work that we've done is that while the economy matters to voters, it's not the only issue that matters to voters. But the economy is always an issue that voters bring into the booth with them.

when they cast their ballots, and that means that how their own local economies are doing may, in the end, be what swings the vote one way or the other in November. [Music]

How Swing State ‘Misery’ Will Decide the US Election

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