Hafer explored a run for Governor of Pennsylvania in 2002, but declined to run after the party rallied around Attorney General Mike Fisher. She went on to endorse Democratic nominee Ed Rendell, and joined the Democratic Party in 2003. After leaving office in 2005, she considered running for several offices, but never did so.
Hafer began her working career as a public-health nurse in the Monongahela Valley. She founded the Allegheny County Center for Victims of Violent Crime in 1973. Elsie Hillman, one of the donors to the center, convinced Hafer to run for public office, leading Hafer to run for the Allegheny County Board of Commissioners in 1983.
She defeated incumbent Republican William Hunt in the primary election, who had dismissed Hafer as "the little nurse from Elizabeth." In 1988, she ran for State Auditor General, and defeated incumbent Democrat Donald A. Bailey. She went on to serve two four-year terms in the post.
In 1990, she won the Republican nomination for Governor to go against the incumbent Robert P. Casey in the general election. In many areas, Hafer ran to the left of the moderate Casey; noted for his strong pro-life stance, Hafer was actually pro-choice. Though Casey had a strong lead in the polls and high approval ratings, Hafer campaigned hard and went as far as calling him a "redneck Irishman." Her campaign was widely criticized, helping Casey seal his commanding lead in both rural areas of the state which are normally Republican, as well as strong support from the more democratic areas. Hafer was defeated by thirty-six percentage points in one of the most lopsided gubernatorial elections in state history.
Unable to seek a third term as auditor general under Pennsylvania term limits, Hafer announced she was running for State Treasurer in 1996 to succeed Catherine Baker Knoll. She faced Knoll's daughter Mina Knoll in the general election. A bitter race ensued, with Hafer challenging Knoll's residency status (she lived in New York) while the Knoll campaign alleged Hafer improperly used state funds for personal use as auditor general. Hafer would go on to win the election.
The race opened a rift between the two women that culminated in 2000 when Knoll herself ran against Hafer for treasurer. As the two most prominent women in Pennsylvania politics at the time, the election was noted for being even more bitter than the previous one; Knoll again accused Hafer of questionable state funds use as auditor general, while Hafer countered that the SEC had investigated Knoll during her time as treasurer. Hafer also called the Knoll campaign "lying scumbags." Hafer was narrowly reelected.
Her successor for auditor general, Bob Casey Jr., attempted to audit the public-employee pension funds that Hafer is on the boards of. This opened a lengthy legal battle between Pennsylvania's two chief financial offices. Hafer maintained no wrongdoing and alleged Casey had a conflict of interest, while Casey called her "a smear artist." Casey would also succeed Hafer as state treasurer.
The Pennsylvania Report said that "She has never marched to a regular drummer, but that is part of her long-running appeal." In a 2002 PoliticsPA Feature story designating politicians with yearbook superlatives, she was named the "Most Popular."
In 2002, Hafer explored a run for the Republican nomination for governor (incumbent Republican Governor Mark Schweiker had already announced his intention not to contest the race). However, after it became clear that the GOP establishment had already decided on Pennsylvania Attorney General Mike Fisher as their nominee, she dropped out of the race. Hafer went on to endorse the Democrat's nominee Ed Rendell, effectively severing all her remaining ties to the Republican Party. Her decision to endorse Rendell "psychologically helped break" the back of the Fisher campaign., and Rendell went on to win the election.
In 2003, Hafer completed her political conversion by switching to the Democratic Party. Her switch was criticized by Rick Santorum and other Pennsylvania Republicans, for using the backing of the party for five statewide campaigns, only to then switch without even contesting a primary. She countered that Santorum being the "de facto" leader of the state party has moved them further to the right, alienating socially liberal (but fiscally conservative) Republicans like herself. She cemented herself as a Democrat by donating the maximum amount to John Kerry's presidential campaign, and endorsing Dan Onorato in his successful bid for Allegheny County chief executive. Hafer also donated to Mayor John Street's re-election campaign.
After her party switch, it was reported that she was considering challenging long-time rival and incumbent lieutenant governor Catherine Baker Knoll in the Democratic primary. She was also reportedly considering seeking the Democratic Nomination for U.S. Senate against Republican Senator Rick Santorum, with a likely primary challenge to the front-runner Bob Casey Jr., Hafer's other political rival. Hafer however affirmed that she buried the hatchet with all of her former rivals long ago, and did not run against either, and endorsed Casey as soon as he announced his Senate candidacy.
Her daughter, Beth, sought to run against Republican Congressman Tim Murphy in 2008, but narrowly lost the Democratic primary.
In February 2010, Hafer declared her candidacy for the Congressional seat left vacant by the death of incumbent Democrat John Murtha. She sought the Democratic nomination for the May special election before ending her Congressional candidacy on March 10, 2010.
In the fall of 2010, Hafer was named in an estate lawsuit that revolves around her late husband, John Pidgeon. The lawsuit claims that she shifted more than $900,000 from her late husband's children and grandchildren to herself and her daughter in the final months of her husband's life. Pidgeon's children and grandchildren are claiming that Hafer took advantage of her husband's declining health and mental status in order to gain financial benefit.
On July 21, 2016, Hafer was indicted on federal charges of lying about taking in more than $500,000 in consulting fees from a company that placed business with her state office. U.S. Attorney Peter Smith said Hafer lied to federal agents who interviewed her in May about money she secretly took in from a business person referred to in the indictment only as "Person #1." Sources close to the investigation described "Person #1" as moneyman Richard W. Ireland, of Chester County, one of Hafer's biggest campaign contributors. The case was investigated by the FBI, IRS and Pennsylvania State Police.
Prior to her political career, Hafer was employed as a registered nurse. She resides in Indiana, Pennsylvania.