Earth to GOP: Talk About Rising Costs

When it comes to economics, Republicans love talking about jobs, jobs, jobs. They cite real unemployment numbers that are far worse than what the public is told. They cite record numbers of Americans leaving the work force. They talk about cold, hard numbers.

The GOP is obsessed with talking about jobs—but why? The vast majority of voters already have a job. We also know that government doesn’t create jobs—that’s what the private sector is for—so when conservatives engage the Democrats on the jobs issue, we’re at a huge disadvantage. They get to play Santa Claus, and we’re left talking vaguely about taxes and regulations—talking points that suggest we don’t know what ordinary working families care about.

If we want to appeal to voters when we discuss economics, let’s talk about what’s impacting everyone—stagnant wages and the rapidly rising cost of living.

The phenomenon of wage stagnation has been occurring for decades—it’s actually a global phenomenon dating back to when President Nixon first pulled us off the gold standard and allowed a floating currency controlled predominantly by the unelected Federal Reserve.

That phenomenon has only worsened since the Great Recession and the advent of the Federal Reserve’s policy of zero interest rates. Wages are staying the same, and prices have been going up year after year.

Source: Wikimedia Commons (CC BY-SA 3.0)
Source: Wikimedia Commons (CC BY-SA 3.0)
Source: "Measuring Working Family Stress in Relation to the Cost of Living," JEC.
Source: “Measuring Working Family Stress in Relation to the Cost of Living,” JEC.

The House Joint Economic Committee, led by Rep. Kevin Brady, created a “Working Family Stress Index” that illustrates the gap between rising prices and stagnant wages. As you can see in the graphics, while wages have nominally increased since 1998, prices have increased at a much more dramatic rate—especially after the Federal Reserve first set near-zero interest rates back in 2002 and 2003, and then again when the Federal Reserve fully embraced zero interest rates after the Great Recession began in 2008.

While the Federal Reserve’s zero interest rate policy has been wonderful for the stock market, it has resulted in a shrinking middle class and a growing gap between the richest among us, who have done just fine over the past several years, and working families, who have not.

So when Republicans keep hammering on jobs, jobs, and only jobs, they are ignoring the most important economic concern to the voting public—rising prices and stagnant wages. And let’s be honest, if the GOP is not appealing to voters on economics and is refusing to talk about social issues, why would anyone vote Republican?

What should Republican presidential candidates be saying?

  • “Working Americans are struggling…”
    • Identify the problem. Wages are stagnant. Prices are going up. Our dollar buys less and less each year, and we aren’t making more of them.
  • “We need monetary reform…”
    • Identify the cause. The Federal Reserve’s policy of zero interest rates helps the rich and crushes working families by devaluing the dollar and artificially creating a rising cost of living. This country’s economic policies are designed to help the rich get richer, while working families continue to struggle.”
  • “It’s time for shared, equitable prosperity…”
    • Identify the solution. “We need to audit the Federal Reserve and establish a national monetary commission to come up with a better monetary solution that works for all Americans. If we’re not growing together, we’re not growing at all.”

Obviously good economic policy needs to be rooted in low taxes, balanced budgets, and a strong economy that sustains job growth, but conservatives must also talk about our broken monetary policy. On the campaign trail, candidates need to be addressing the most pressing problem facing working families, and right now that’s the rising cost of living.

Jon Schweppe is the Deputy Director of Communications for American Principles in Action. Jon graduated from Augustana College in Rock Island, Illinois, where he studied Economics and Business.