Economic Policy – The Wrongologist

Harris’s Closing Argument

The Daily Escape:

Wrongo has no idea if Harris’s campaigning on a “Constitution over Party” pitch with Liz Cheney to Niki Haley voters is working, but he doubts it’ll be enough to win the election. Wrongo doesn’t know if Harris would have been better served by engaging with Muslim and Arab voters, assuming that she couldn’t have done both, and chose not to.

As I’ve spoken to friends who support Harris, the big question is when does she take the focus off Trump and begin her “closing argument”? Wrongo thinks she should focus on the “cost of living”. There’s no getting around that it’s high, that it’s higher than it should be, and that it’s a primary concern for most Americans.

In an NBC News poll, three in 10 voters under 30 years old said that inflation and the cost of living is the most important problem currently facing the country, three times more than the share calling “threats to democracy” their most important issue, which was the next highest issue among young voters. Abortion is the third most selected issue at 9%, followed by the Israel-Hamas war and “crime and safety” — both of which were selected by only 8% of young voters.

At the same time, new polling by AARP shows Harris leads Trump with women over the age of 50 by more than any presidential candidate since 2016. The survey shows that 54% favor Harris vs. just 42% for Trump (+12 points). It’s a huge improvement from Biden, who in January, led Trump by three points with women over 50. Harris’s numbers are also better than Clinton’s numbers in 2016, when she polled 48%-40% over Trump: (emphasis by Wrongo)

“Overwhelmingly, women over 50 say that the economy and affordability are their biggest issue. Only a third of those surveyed say the economy is working well for them on a personal level, with 62% saying it isn’t. Another 41% of older women have confidence that in one year, they will be financially better off, as opposed to 49% saying they’re not confident of that.

Cost of living is the most important issue to 46% of those surveyed, with immigration in second at 30%…”

AARP believes that women over 50 can potentially sway the election, so Harris should take heed. Showing empathy with Gen Z and older women should be at the top of Harris’s closing argument. Speaking generally about some of her policies and contrasting with Trump’s “all tariffs all the time” tax on Americans should be an easy sell.

In a sense, the campaigns disagree on who the final persuadable voters are:

Trump is after low-propensity Republicans who don’t mind his crassness and authoritarian personality.
Democrats see small pockets of persuadables grouped by issues across the political spectrum, anchored by the idea that the next president has to ensure that prices come down.

Ultimately, this campaign is likely to come down to whether Trump’s character is too distasteful to GOP-leaning suburban women and to enough Latino and Black voters that they hold their noses and support Harris. Harris is clearly putting a ton of effort into these voting subgroups.

If you want insight into what Harris is delivering every day out on the campaign trail, read this transcription by Marcy Wheeler of Harris’s session with Maria Shriver. She asked Harris how she copes with the stress. After admitting she wakes up most nights these days, she gave this impromptu speech against despair:

“Let me just speak to what people are feeling. We cannot despair. We cannot despair. You know, the nature of a democracy is such that I think there’s a duality. On the one hand, there’s an incredible strength when our democracy is intact. An incredible strength in what it does to protect the freedoms and rights of its people.

Oh there’s great strength in that.

And, it is very fragile. It is only as strong as our willingness to fight for it. And so that’s the moment we’re in. And I say do not despair because in a democracy, as long as we can keep it, in our democracy, the people — every individual — has the power to make a decision about what this will be.

And so let’s not feel powerless.

Let’s not let the — and I get it, overwhelming nature of this all make us feel powerless. Because then we have been defeated. And that’s not our character as the American people. We are not one to be defeated. We rise to a moment. And we stand on broad shoulders of people who have fought this fight before for our country. And in many ways then, let us look at the challenge that we have been presented and not be overwhelmed by it.

The baton is now in our hands, to fight for, not against, but for this country that we love. That’s what we have the power to do.

So let’s own that? Dare I say be joyful in what we will do in the process of owning that which is knowing that we can and will build community and coalitions and remind people that we’re all in this together.

Let’s not let the overwhelming nature of this strip us of our strength.”

Everyone should read that.

Wrongo thinks that there are legions of enraged women who are not being polled but ARE heading to the polls. That there are legions of young people who see Trump and the GOP for what they are and want none of it.

As someone who supported Harris in 2020 and was extremely disappointed in her at the time, I was pretty worried about how strong a campaigner she would be, and how well organized a campaign she was going to run. So far, so good.

Most Dems are doing more than they ever have to try and help win this.

And yes, hope is a good thing, maybe the best of things.

Political Advertising: How Effective Is It?

The Daily Escape:

Wrongo’s calendar says there’s just 29 days to go until Election Day. The campaigns are in high gear, but what are they saying? And is what they’re saying getting through to both their base voters as well as to those who are “persuadable” enough for them to get out to the polls and vote? Time is running out.

Timing is a point raised in this NBC story, which describes that, after having taken the last 76 days to introduce the Vice President to voters, the campaign now plans to ratchet up negative advertising about how unfit Trump is to be President (emphasis by Wrongo).

“Leaning more heavily into negative campaigning is a strategic shift for Harris. While she has routinely been critical of Trump since becoming a candidate in July….Harris campaign officials said they intend to continue laying out her policy positions, background and plans…But emphasizing what Harris campaign officials view as Trump’s major vulnerabilities is seen as possibly one of the only ways to finally win over some voters who haven’t made up their mind in a static race that Democrats want to push in their direction.”

A recent poll by the Associated Press-NORC Center for Public Affairs suggests that Harris’ attacks on Trump’s brand of hyper-masculinity appear to be working. As the Daily Beast summarized the findings, respondents:

“…chose Harris 59% over Trump’s 57% when it came to which candidate they felt was tough enough to be president…and favored Harris 55 to 46 % on “which candidate would change the country for the better,” and by 54 to 43% on who “was more likely to fight for them.”

Harris also is micro targeting the message of Trump’s weakness. From the WaPo:

“For the millions of football fans who tuned in from home for Saturday night’s much anticipated matchup between the University of Georgia and the University of Alabama, she also ran a new ad nationally on ABC that hammers home her point.”

The ad says:

“’Winners never back down from a challenge. Champions know it’s anytime, anyplace. But losers, they whine and waffle and take their ball home,’ the narrator says at the start of the spot, over images of a football game and washed-out footage of Trump missing a golf putt. The 30-second ad ends with footage of Harris challenging him to another debate, with the words “When we fight, we win” hanging on a sign in the background.”

The money quote:

“Well, Donald, I do hope you’ll reconsider to meet me on the debate stage. If you’ve got something to say, say it to my face,…

Harris also posted the ad on Trump’s Truth Social media platform.

Marcy Wheeler quotes CNN’s David Wright who tracks political spending by the candidates about where the money is headed in this final month as the ad wars intensify:

“You can see how each side is placing bets on their best path to 270 electoral votes. In the first week of October, the Harris campaign is spending the most in the critical trio of “Blue Wall” states – they’ve got more than $5 million booked in Pennsylvania, about $4 million booked in Michigan, plus about $2.7 million booked in Wisconsin. And that makes sense – if Harris wins all three of those states, plus Nebraska’s up-for-grabs electoral vote in the swingy second congressional district (where the campaign also has more than $300,000 in ad time this week), she’s the next president.”

Turning to Trump:

“…he’ s looking to the Sun Belt. This week, Trump’s campaign is spending the most on ads in Pennsylvania, $3.8 million – it’s really the linchpin to both sides’ strategies. But in addition to that, the campaign is also spending $3.4 million in North Carolina and nearly $3 million in Georgia, its other top targets, and if he wins those two states plus Pennsylvania, he’s heading back to the White House.”

The Electoral College will come down to which of the two campaigns potential voters consider more trustable, probably mostly on their personal economic situation and where that’s heading with each potential president. From the WaPo:

“Americans are finally starting to feel better about the economy, invigorating Vice President Kamala Harris’s pitch for the presidency as she narrows her Republican opponent’s longtime lead on an issue that is foremost on voters’ minds.”

“Although voters still favor former president Trump over Harris on handling the economy, his advantage has dropped dramatically in recent weeks. Trump now averages a six-percentage-point edge on the economy…”

But Trump’s only answers for the economy are lower taxes on the rich and more tariffs. Yet, like everything else, Trump has no idea what tariffs actually do.

However, a new survey by Data For Progress’s top line finds Harris leading Trump by 3 points among likely voters nationwide. Nearly half of voters (49%), including a plurality of Independents (46%), choose Harris, while 46% choose Trump.

On the all-important economy, Harris has a trust advantage on most of the economic measures tested, including: supporting small businesses (+10 points), taxes on middle class Americans (+9), increasing wages (+5), lowering housing costs (+5), handling labor union policy (5%), improving our infrastructure (+3), lowering grocery costs (+2), creating jobs (+1), and protecting domestic manufacturing jobs (+1).

That says her campaign messaging is getting through.

Also the survey finds Trump with just a +1-point trust advantage over Harris on “reducing inflation,” an issue that voters have consistently ranked as their most important when deciding whom to vote for. Here’s their chart:

They also surveyed candidate favorability, which now tilts towards Harris. Harris’ rating is +2, while Trump’s is -12:

Is this poll on the money? Difficult to tell. A shorter election season makes it harder for campaigns to assess where to place their bets. And which of their cohorts in the electorate demand the most attention. We’ve focused on Gen Z and younger voters as being primarily swayed by economics. Messaging to women is another important element. Harris can run ads attacking Trump’s hyper-masculinity, (which will help with women).

From The Economist: (emphasis by Wrongo)

“And Harris needs to focus there. In the Obama years the gap between young men and women identifying as liberals was just five percentage points, during the Trump-Biden years this has tripled to 15 points, according to Gallup. This change has been caused almost entirely by young women moving to the left, rather than young men tacking to the right. The fact that this generation’s formative years were during the #MeToo movement, the Trump years and the decision to overturn Roe v Wade helps explain it.”

In 2020 a majority of white women voted for Trump. He will be in the minority in 2024. Leading among women is a real advantage. Since the 1980s a greater share of women than men has turned out to vote. In 2020 women made up 54% of the electorate. A final indicator that Democrats might be winning this battle of the sexes: in battleground states, according to Target Smart, a data firm, between July and September, twice as many young Democratic women registered to vote than young Republican men.

Trump’s bet is that Harris is the one with the turnout problem. They think their base is more committed to their candidate than is Harris’s. But Marcy Wheeler points to Harris’s investment in the Dem ground game:

“The Harris campaign claimed in late September to have 330 offices and more than 2,400 staff. They completed 25,000 weekend volunteer shifts on the final weekend of last month, contacting over 1 million voters over three days and completed the 100,000th event of the campaign.”

BTW: Ms. Oh So Right got a postcard from Harris to vote early this week.

Cartoons of the Week Plus Commentary – October 6, 2024

Cartoons this week were mostly about Vance failing to answer the “Who Won?” question. Here’s one Wrongo liked:

There’s always something in October:

Wrongo wants to update his last column about why Harris needs to speak with more empathy to Gen Z and younger voters. Friend of the Blog John S. left this comment:

“I believe Harris is speaking but perhaps not loud enough or Gen Z isn’t listening. Her plans do include downpayment money for new housing, tax incentives for builders to sell to first time home buyers, 3 million new homes constructed, business startup credits, earned income credits for low wage earners, newborn tax credits, food price regulations, and reduction of medical debt. Maybe you can say it won’t be enough or that some of these things can’t be implemented but nonetheless they are in “the plan”. Perhaps if her message was stronger on social media, as you mentioned in another column, the “Z’ers” would listen.”

He’ s right but Harris like most Dem politicians, isn’t offering sufficient “feel your pain” context to get people to listen. Obama was one of the few Democrats to place policy in a human context, but most of the time, the Democrats are relying on a laundry list of policies that may or may not ever be enacted.

America had good economic news yesterday, but no Republican was willing to cede that to Biden or the Democrats. Sen. Rubio (R-FL) claimed in a post on Twitter/X that the great jobs numbers were “fake” because past months had to be revised (most jobs reports are revised in subsequent months).

It’s true that the economy added jobs. But most were low-income service jobs. Meanwhile, the pathways to the middle class, manufacturing and white collar jobs, actually shrank. The Gen Z and younger workers suspect that the American Dream is fading because middle class jobs are going away, and they’re precisely correct in that intuition.

The GenZ’ers can’t square their lived reality with the commentary that comes from on high, particularly regarding the economy. Over time, they’ve come to distrust institutions. That’s true at a social level—levels of trust have cratered over time. And this is a key reason why this gulf between what young people live, experience, feel, and the skin-deep recitation of the miracle of the “Booming Economy”. It doesn’t reach deeply enough into their lives.

Harris shouldn’t cede any of this ground to Trump. Wrongo quoted Vance during the VP debate:

People are struggling to pay the bills. Times are tough.
The American Dream is fading, and feels unattainable.
We should stop shipping jobs offshore.

And Republicans understand the task at hand is to peel younger voters in swing states away from Harris. FWIW reports that a constellation of Right-wing groups are spending millions online to get their messaging in front of swing state voters. Probably the biggest line of attack being used against Harris has to do with inflation and the state of the economy: (brackets by Wrongo)

“For example, Duty to America is specifically targeting Gen Z and Millennial men in battleground states with ads bemoaning the state of the economy, saying: ‘According to…Harris, the economy is fixed [repaired]…at our age, our parents owned a home, had kids, saved for retirement, and we can barely buy groceries, gas, or pay our rent.’”

“This ad is running across platforms like Facebook, Instagram, and Google, but also on Roku devices and streaming services where young people actually watch TV shows. Duty to America has spent the majority of its ad dollars targeting Michigan, Pennsylvania, Georgia and North Carolina.”

“Similarly, Preserve America is running direct-to-camera video ads on Facebook and Instagram from a trio of white women who are complaining about high inflation and grocery prices, sometimes tying the issue to illegal immigration. You can browse through some of those ads here.”

FWIW adds a chart about ad spending: (note that the red and blue here are 100% pro-Trump spending)

A few other groups have also emphasized economic attacks among younger members of the electorate. One from Our American Century says “Kamala Harris thinks young people are stupid” when it comes to the economy, and Right for America is also running with the “stupid” line.

FWIW notes that Harris is outspending Trump on Facebook and Instagram: Harris spent $8.1 million to Trump’s $1.1 million between September 21 to 28. Meanwhile, political campaigns spent $40.3 million on Google and YouTube ads last week, with Harris and affiliates spent $10.8 million to Trump’s $2.8 million.

Here’s a recap of spending by both campaigns:

The Democrats instead should invest more money where the young people are. They should challenge the Republicans by admitting that things look pretty dire for Gen Z and younger people. That over time, the American Dream’s faded. That times are rough. That people are struggling.

They should use exactly those words like Vance did, because they’re the ones that count. They resonate. You have to hope that the Harris brain trust will match Trump’s initiative by spending some of this money targeting Gen Z and younger voters with empathetic messaging like the Republicans are already doing.

The policy details can come once they’re listening.

Harris Needs To Speak To Gen Z’s Reality

The Daily Escape:

Before tackling the major subject for today, Wrongo wants to briefly cover something you probably missed. There was an abortion ruling in Georgia that overturned the state’s anti-abortion law. The judge plowed new ground with his reasoning: (emphasis by Wrongo)

“While the State’s interest in protecting ‘unborn’ life is compelling, until that life can be sustained by the State — and not solely by the woman compelled by the Act to do the State’s work — the balance of rights favors the woman….Women are not some piece of collectively owned community property the disposition of which is decided by majority vote. Forcing a woman to carry an unwanted, not-yet-viable fetus to term violates her constitutional rights to liberty and privacy, even taking into consideration whatever bundle of rights the not-yet-viable fetus may have….It is not for a legislator, a judge, or a Commander from The Handmaid’s Tale to tell these women what to do with their bodies during this period when the fetus cannot survive outside the womb any more so than society could — or should — force them to serve as a human tissue bank or to give up a kidney for the benefit of another….When someone other than the pregnant woman is able to sustain the fetus, then — and only then — should those other voices have a say in the discussion about the decisions the pregnant woman makes concerning her body and what is growing within it.”

The ruling is unlikely to be the final word on abortion access in Georgia, since the case will ultimately be decided by the Georgia Supreme Court.

The judge has a solid argument: Why does society have an interest in a viable fetus when we know society won’t lift a finger to financially and medically support the newborn? Why allow the government to intervene at a time when the costs involved for the mother to continue with the pregnancy increase substantially?

Let’s move to a powerful idea that emerged in the VP debate. Wrongo thinks the key to winning the election will be how Harris reaches out to Gen Z (those born between 1997 and 2012). PBS Newshour interviewed Kyla Scanlon, who reminds us that Gen Z now has more people in the workforce than the Boomer generation, but they aren’t faring as well. Scanlon says that Gen Z has had a tough go of it, being essentially born into the tech bubble, growing up during the Great Recession and then graduating or being in college during the pandemic.

From Scanlon: (brackets by Wrongo)

“…I think for a lot of Gen Z’ers, rent is definitely not as affordable as it used to be. Real wages have increased, so [have] wages adjusted for inflation, but rent has increased much more. And that’s sort of the foundation of how everyone experiences the economy. It’s where you live and how you have to pay for where you live….people look at the price of rent, they look at the price of gas, they look at the price of food, they just look at the inflation that we have experienced over the past few years, and it’s sometimes just not enough to even make those real wage gains worth it.”

“It’s also the cost of childcare, eldercare, these things that are economically quite painful, but don’t necessarily show up in traditional economic measurements like GDP….They’re things that are… hidden costs that people experience.”

Scanlon also talked about the negative bias in the media that’s driving how people feel about their economic circumstances. Media sentiment on the economy has trended either skeptical or negative for a very long time, so people are reading negative headlines despite the economists and pundits saying the economy is OK. This is a big disconnect for the younger generations who get most of their news from social media.

In the debate, Vance said a few things that certainly resonate with Gen Z and others. He noted three things in particular:

People are struggling to pay the bills. Times are tough.
The American Dream is fading, and feels unattainable.
We should stop shipping jobs offshore.

It’s hard to disagree with any of that, and Harris shouldn’t cede any of this ground to Trump. How hard is it to build this into your stump speech? She could easily acknowledge that we’re in the midst of a global cost of living crisis. The biggest one in half a century.

But it was left to Vance and Scanlon to say the things that most Americans feel.

Gen Z and their younger cohorts mistakenly think that the economy is a zero sum game, meaning that if China is doing well or immigrants are coming here and finding work, that regular Americans must be doing worse, even though the economic statistics say otherwise.

Harris needs to deliver an economic message that’s grounded in the reality that Gen Z and others are experiencing. It can be as simple as acknowledging what Vance or Scanlon called out as problems for many younger Americans.

All she needs to do is “Just Say It”.

Many of Wrongo’s 12 grandchildren (17-32 years-old) largely feel that the American Dream is beyond their reach. They’re certain Social Security won’t be there for them. Most think that they’ll never own a home.

Why can’t Harris speak to this? Harris and the Dems talk vaguely about “the opportunity economy” but a more emotional and empathetic call out is required. People with economic problems need to trust the head of the ticket, and that trust starts with acknowledging their reality: That things aren’t as good for the younger generations as the economic statistics say they are.

The Dems have an actual track record: Investing in infrastructure and encouraging domestic production of strategic goods. Investment in manufacturing is at an all time high. We’re starting to produce advanced chips in Arizona. Unions are stronger than in recent years.

Harris needs to show empathy for those in Gen Z (and younger) who are not fully participating in the opportunity economy.

It will help her win in November.

The Gap Between Economic Statistics (good) vs. People’s Perception Of Economic Situation (terrible)

The Daily Escape:

Monument Valley, Navajo Tribal Park, AZ – May, 2024 photo by Hung Ton

From The Lever:

“Americans paid roughly 25% more on groceries and dining out this March than they paid in January 2020, outpacing the rate of general inflation. Over that same period, the companies behind the country’s 10 largest grocery and restaurant brands have together returned or pledged to return more than $77 billion to shareholders.”

“In March 2024, consumers spent 95% more for a carton of eggs, 33% more for a pound of ground beef, and 22% more for a gallon of milk than they did before the pandemic.”

According to an analysis by Food and Water Watch, a corporate watchdog group, food costs for an average family of four living on a “thrifty” budget increased 50% from January 2020 to January 2024, from $654 to $976 a month.

When economists and pundits talk about the disconnect between America’s overall economic performance and how badly Americans view the economy, this unprecedented spike in food costs is at the heart of the problem.

In 2021, as food costs were skyrocketing, America’s biggest chains and grocery brands blamed the price hikes on supply chain issues and economy-wide inflation. But these same companies have expanded profits and quietly authorized billions of dollars in stock buyback programs and dividend payouts to shareholders.

Former PepsiCo CFO Hugh Johnston told Bloomberg last year that consecutive double-digit price hikes on the company’s products in recent years were “just there to cover inflation”. But in 2023, PepsiCo reported $91 billion in net revenue, a 35% increase over prepandemic income. And it used $7.7 billion of its profits to repurchase stock and issue dividends. Those buybacks increased by a whopping 843% compared to 2021.

More from The Lever: (emphasis by Wrongo)

“Matt Gardner, senior fellow at the Institute of Taxation and Economic Policy, a tax policy advocacy group, said buybacks boomed right before the pandemic when Trump-era tax cuts left corporations with extra cash on hand.”

Advocates for the Republican tax cuts said that companies would reinvest that tax windfall back into the economy via manufacturing and jobs (more trickle down). But many began plowing money into buybacks instead.

Tyson Foods more than doubled its profit margins between 2021 and 2022 after hiking prices for beef, pork, and chicken by 30%. The company claims it raised prices because it needed to offset increased costs in labor, transportation, and grain for animal feed. But data from earnings reports show that while increased operating costs set the company back $1.5 billion dollars in 2022, price increases expanded profits by $2 billion, meaning consumers covered Tyson’s inflation costs plus they also shelled out $500 million more. That year, Tyson repurchased $702 million of its own shares and raised dividends by 4%.

Some Americans trying to save money by eating fast foods have seen those prices increase too. A study of the country’s biggest fast food brands by Finance Buzz found that at all of them, menu prices have outpaced inflation. The Food Institute’s survey shows that: (emphasis by Wrongo)

“Due to inflated costs, 78% of respondents say they now view fast-food as a luxury. The percentage increases to 80% or higher among those making less than $30,000 a year.”

These high food costs have been largely caused by the food industry increasing prices faster than their costs.

Americans are largely supportive of efforts to regulate how much companies charge for food. In a new Data for Progress poll, 69% of respondents said the government “should do more to regulate grocery stores that raise prices to maximize profits.”

Sad to say, the Democrats will not do anything meaningful to bring down the cost of food.

And the higher expense of putting food on the table may partly explain the so-called “vibecession”. There’s a great divide in the US between how people see their personal financial situation (pretty good) and their view of the overall economy (terrible). Here’s another chart:

Data: Federal Reserve Survey of Household Economics and Decisionmaking; Chart: Axios Visuals

In the above poll by the Federal Reserve, respondents are asked to choose from four options when it comes to how they’re doing. The top two choices were “living comfortably” and “doing OK.” 72% of Americans landed in those categories.

Respondents are also asked about the financial well-being of the national economy — the top two choices, “excellent” and “good,” were chosen by only 22% of Americans. In addition, that gap between people’s perceptions of their financial well-being and that of the national economy has nearly doubled since 2019. From Axios: (brackets by Wrongo)

“This divide is showing up in plenty of surveys. The University of Michigan Consumer Sentiment Index for May [2024] came in lower than 84% of readings since 1978….Just 22% of respondents to a May Gallup poll said they were satisfied with the way things were going in the US, compared to 77% dissatisfied. That’s a wider gap than three-quarters of the time since they started asking the question in the 1970s. A Harris poll last month showed that 56% of Americans think we’re in a recession.”

Brian Beutler reminds us that if Trump were in office today — presiding over full employment while Americans enjoyed more purchasing power than ever before, and inflation was hovering steadily around three percent — he and Republican politicians would claim credit for building the greatest economy in US history.

But Biden and his handlers are vacillating about how to address the economy’s perception gap. From Beutler:

“Nevertheless, the emerging Democratic consensus seems to be that Biden should continue to ‘meet people where they are’: sympathize with the plight of the struggling, implicitly concede that the economy—which would poll through the roof with Republicans stealing credit for it—is actually bad.

Within the White House…aides are pushing for a message that makes empathy toward the economic plight of certain Americans more central….Some noticed a preview…when the president described the April inflation report…‘I know many families are struggling, and that even though we’ve made progress we have a lot more to do.’”

That can’t be right if we can swap Republicans for Democrats without changing anything else, and the perception gap would somehow magically go away.

But Biden shouldn’t be speaking as though the economy is one where more people need help when the truth is that fewer people need it. That would affirm the false notion that economic suffering is broadly based and something must be done to alleviate it.

The WaPo’s answer was an editorial saying that “Nearly everything Americans believe about the economy is wrong”. The same issue also had a story saying that people can’t make ends meet.

Are both of those things simultaneously true? Politicians better figure out which is primary (great economy) and which is secondary (bad personal financial situation).

We know that people are struggling to pay rent and mortgages and now, fast food’s a luxury. This is what is making many people think that this is the worst economy ever. And if you look closely this isn’t just “anecdotal”. The statistics supplied above seem to bear it out in some detail.

Biden needs to brag about the economy but he also must call out the food industry, and show people who are struggling that he’s trying to help.

Democrats Are Better For The Economy

The Daily Escape:

Sunset at Fonts Point, Anza-Borrego Desert SP, CA – March 2024 photo by Paulette Donnellon

“If you want to live like a Republican, vote for a Democrat.” – Harry S. Truman

Republicans always claim that they are the Party of prosperity. They pretend that their policies lift everyday workers and their families, what with tax cuts and all, and the public seems to buy it. In polls, the Republicans usually get better marks on the economy than Democrats, often by hefty margins.

But as John E. Schwarz notes in the Washington Monthly:

“What is truly startling is the astonishing degree to which American workers have fared better under Democratic than Republican presidents….Today, the economic data are unambiguous: Whether it’s real wage gains or job creation, average Americans have fared far better under Democratic than Republican presidents.”

From the economist Jeffery Frankel, Professor of Capital Formation and Growth at Harvard University, and formerly a member of the White House Council of Economic Advisers:

“Since World War II, Democrats have seen job creation average 1.7 % per year when in office, versus 1.0 % under the GOP. US GDP has averaged a rate of growth of 4.23% during Democratic administrations, versus 2.36% under Republicans, a remarkable difference of 1.87 percentage points. This is postwar data, covering 19 presidential terms—from Truman through Biden. If one goes back further, to the Great Depression, to include Herbert Hoover and Franklin Roosevelt, the difference in growth rates is even larger.”

Frankel says that the results are similar whether one assigns responsibility for the first quarter of a president’s term to him or to his predecessor. He also makes the point that the average Democratic presidential term has been in recession for 1 of its 16 quarters, whereas the average for the Republican terms has been 5 quarters, a startlingly big difference.

Frankel asks whether these stark differences in outcomes are simply the result of random chance? But he concludes they aren’t:

“The last five recessions all started while a Republican was in the White House (Reagan, G.H.W. Bush, G.W. Bush twice, and Trump)….The odds of getting that outcome by chance, if the true probability of a recession starting during a Democrat’s presidency were equal to that during a Republican’s presidency, would be (1/2)(1/2)(1/2)(1/2)(1/2), i.e., one out of 32 = 3.1%. Very unlikely.”

I know, nobody said there’d be math in the column. Frankel says that the result is the same as the odds of getting “heads” on five out of five consecutive coin-flips. And it gets worse if we look back further in time:

“A remarkable 9 of the last 10 recessions have started when a Republican was president. The odds that this outcome would have occurred just by chance are even more remote: one out of 100. [That is, 10/2¹⁰ = 0.0098.]”

More math, but you get the idea. If you look at job growth, the results are similar. More from John Schwarz:

“The significant contrast between each party’s record on wage and job growth has held true from the election of Ronald Reagan in 1980 through to the onset of the pandemic, just after 2019 ended, and after that, starting once again under Joe Biden.”

Here’s a chart from The Economist:

The Republican and Democratic Parties were in the White House for roughly equal amounts of time, 24 years each. During the Republican presidencies they created about 17 million jobs, whereas Democrats presided over the creation of about 60 million. That’s such a big gap that Americans can safely reject claims of stronger economic performance under Republicans.

Schwarz closes with this:

“Democrats have an amazing story to tell in 2024. They should tell it loud and clear.”

Absolutely!

Enough of the hard math. It’s time for our Saturday Soother, when we try to disconnect from Trump’s Bible sales and from the plan by Senate Republicans to introduce articles of impeachment of the Secretary of Homeland Security when there’s so much truly pressing business for them to consider.

Here on the Fields of Wrong, we’re attending to some spring yardwork in the precious time between passing rain and snow showers. We will also find the time this weekend to watch college basketball’s March Madness.

To help you focus on anything but politics on this Easter weekend, grab a seat by a south-facing window and listen to Gregorio Allegri’s “Miserere mei, Deus” (Have mercy on me, O God), performed here in 2018 by the Tenebrae Choir conducted by Nigel Short at St. Bartholomew the Great Church, in London.

Allegri composed this in the 1630s, during the papacy of Pope Urban VIII. The piece was written for use in the Tenebrae service on Holy Wednesday and Good Friday of Holy Week. Pope Urban loved the piece so much, that he forbid it to be performed elsewhere outside of the Sistine Chapel.

We all could use a little mercy now, and this is beautiful:

State Of The Union Speech Mop-Up

The Daily Escape:

Morrow Bay, CA – March 2024 photo by Slocoastpix

(This is most likely the only column this week, as Wrongo is working on an outside project.)

Today let’s cover a few disparate topics that are about clean-up from the Biden State of the Union address. The Hollywood Reporter reports on Biden’s viewership ratings with this headline:

“The 2024 State of the Union address drew a larger TV audience than the 2023 address.”

Biden’s speech averaged 32.23 million viewers across 14 broadcast and cable outlets, almost 5 million more viewers than the 2023 State of the Union. Viewership rose on all of the largest outlets by about 18%. More:

“The vast majority of viewers — 28.47 million — watched the State of the Union on the big four broadcast networks (ABC, CBS, Fox and NBC) and the three largest cable news outlets (CNN, Fox News and MSNBC). All seven outlets drew a bigger audience than they did for last year’s address.”

So much for viewer apathy. One big surprise to Wrongo is that Fox News led with 5.84 million viewers, beating out the 5.24 million for ABC, which had the largest viewership among the broadcast networks. NBC’s 4.47 million viewers finished third, followed by MSNBC at 4.43 million, (its largest audience ever for a State of the Union).

Why would Fox have more viewers when their network demographics skew far more to the Right than the others? Did they tune in hoping to see a Biden senior moment?

Second, Sen. Katie Britt (R-Jesus) lied in her rebuttal for the GOP.

Third, Umir Haque’s newsletter, the issue has some good insights that Wrongo hasn’t seen elsewhere. About leadership: (emphasis, parenthesis and brackets by Wrongo)

“We recently discussed the difference between occupying a leadership position—and being accepted as a leader. This Biden’s been hid[den] away by the Democratic machine….Those roaring, electrified [people attending the speech)? Those surging positivity ratings? That’s…going from merely occupying the position, to being accepted as a leader.”

“Biden quietly proposed something very much like a new America. A new American social contract. The ideas came so fast and furious that they were almost easy to miss, sandwiched between philosophy and persuasion.”

“…most State of the Unions aren’t like that. They’re pretty boring because Presidents tout their accomplishments. They’re backwards looking…sort of performance reviews….This one really was…profoundly different.”

Haque who lives in the UK, says that the ideas Biden put forth, are very popular in Europe:

Taxing billionaires, which is part of a new movement, arising mostly in Europe, to reduce inequality, by having a global tax on the ultra-rich.
Taxing executive compensation on salaries over $1 million by making them no longer tax deductible. This is also linked to recent moves by European nations to make economies more equal again.
Giving home buyers tax credits. This is a first step towards fixing America’s badly broken housing market…..many European nations are trying to fix that through incentives like this.
Lowering drug prices. One of Biden’s most revolutionary policy ideas was to let the government negotiate prices for many more drugs—this is a big deal, because of course Americans are ripped off incredibly badly by their version of “healthcare.” This would bring the US in line with other Western nations.

More: (brackets by Wrongo)

“if you read between the lines….Biden [is] recognizing how badly broken many aspects of the American social contract [are] —healthcare, housing, inequality, salaries, taxes—and how all that adds up to an incredibly precarious life even [if you are] at or above the median [income].”

“Taxing billionaires, limiting salaries, intervening in broken markets, giving people actual support—none of these are ideas we associate in the slightest with…American politics. They’re the stuff of social democracy, and Biden’s setting out a sort of lightweight…social democratic vision. It’s not quite one fully, but what it does…is begin to put America on the path to becoming one, like the rest of the Western world.”

This sets a clear distinction between the Parties in 2024. Democrats since Bill Clinton have not had a clear definition of what they stand for: What do they stand for? What’s their overarching idea? Are they after a just society, and a good life for all Americans?

This theory of the good life, the just society, and how they’re linked now has Biden championing a politics that isn’t simply another version of “life’s about winners and losers”. Haque thinks this is an incredibly important evolution in US politics.

Will Biden’s move leftward bring enough votes to win in November? We have to hope it will. Conservative Republican Peter Wehner in the NYT reminds us that there’s just 34 weeks to the election:

“The next 34 weeks are among the more consequential in the life of this nation. Mr. Trump was a clear danger in 2016; he’s much more of a danger now. The former president is more vengeful, more bitter and more unstable than he was, which is saying something…..He’s already shown he’ll overturn an election, support a violent insurrection and even allow his vice president to be hanged. There’s nothing he won’t do. It’s up to the rest of us to keep him from doing it.”

It’s time on this Monday morning, to wake up America! IF he gets to run the country, Trump will act like a juvenile delinquent, flipping over as many of the cafeteria lunch tables as he can. In a nutshell, that’s his MAGA platform. And like the Zombie Apocalypse come to life, sooner or later all Republicans who hold public office will endorse him.

The rest of us have to put aside our ideological differences and support Biden. To help you wake up watch and listen to The Clash perform “(White Man) in Hammersmith Palais” from their 1979 album “The Clash”. This is far from their best, but it’s on point for today’s column:

This song is from a time when the youth began to realize that sticking together was actually a better idea than allowing themselves to be divided. That has to come back.

Sample Lyric:

White youth, black youth
Better find another solution
Why not phone up Robin Hood
And ask him for some wealth distribution

Thoughts On Biden’s Performance And On Gasoline Consumption

The Daily Escape:

Saguaros and poppies, Catalina SP, Tucson, AZ – March 2024 photo by Paul J Van Helden

You’ve all heard and read about Biden’s State of the Union (SOTA) speech last Thursday. But maybe you’re unaware of the White House strategy for the speech. This was the first SOTA in history to be streamed live on Instagram, in addition to a primary stream on YouTube. Playbook reported that the 9 pm and10 pm hours were the best periods of grassroots fundraising for Biden since the President’s campaign launch.

The White House Office of Digital Strategy also held several events to brief and engage digital creators and media brands around the SOTA. There was a creator watch party in the White House State Dining Room during the speech. Given the declining reach of legacy media, these creator engagement strategies are important.

Trump had planned to comment on Biden’s speech in real time on his Truth Social platform but it went down for the first part of the SOTA. It took over an hour to read what he had to say. When the site came back, we learned that Trump had pretty much just been ranting about Biden’s coughing and warning people not to shake his hand because it had germs.

As an aside, Trump has been a germophobe forever. A casual friend knew him quite well in the 1980’s. Then Trump was a young real estate entrepreneur wanting to get into a fancy Westchester, NY country club. My friend’s husband was also in the real estate business, and Trump’s father Fred prevailed on him to get the Donald into their club. That led to multiple weekends where Trump would take a limo to Westchester to play golf with my friend’s husband and several buddies, all of whom were club members.

It turned out that Trump was a good golfer, so the men were ok with playing with him, except for the obvious cheating on the course. But after each round, the group would adjourn to one of the members’ homes for a potluck, and there Trump’s germophobe flag would fly. He wouldn’t shake hands, and he washed his hands often. He clearly preferred going through the buffet line first, to the extent that if he couldn’t he wouldn’t eat.

Apparently, Trump has done a lot to overcome his germ fears but it all came back when Biden didn’t wash his hands before leaving the podium.

A little on Biden’s strategy: Biden isn’t banking on turning out 100% of Democratic voters. He’s not necessarily counting on low-propensity voters who normally have very little interest in politics. His goal is for Trump to continue to be himself, while Biden, in addition to getting high Democratic turnout, will peel off about 10% of self-identified Republican voters (up from 8% in 2020) and then win Independents. Wrongo has stated previously that he’s certain that Trump will not get near the same number of votes he got in 2020.

Next up, the Biden campaign is rolling out a $30 million ad buy and many more campaign travel stops.

What to say about the rebuttal speech? Sen. Katie Britt (R-AL) spoke from her kitchen table. By the end of the evening, there seemed to be less talk about her vice presidential chances than about who might play her on Saturday Night Live’s cold open.

Let’s turn our attention to gasoline consumption in the US. Wolf Richter reports that for 2023, gasoline consumption was where it had been 20 years ago, even though miles driven set a new record. This was largely due to more efficient internal combustion engine (ICE) vehicles and the shift to electric vehicles (EVs). Wolf provided two handy charts:

Gasoline consumption in the US in terms of product supplied to gas stations rose by 1.5% in 2023, to 376 million gallons per day. But that was still down by 3.9% from 2019. It’s finally back where it was in 2003, (20 years ago).

For clarity, gas consumption is determined by miles driven, and the growing efficiency of gasoline-powered vehicles, including hybrids, along with the transition to EVs (the #2 bestselling model in the US in 2023 was a Tesla).

The second chart above, “per-capita gasoline consumption” makes what’s going on clearer. The US population has grown over the past 20 years, but while gasoline consumption has been flat, per-capita gasoline consumption has plunged by 15% from 2003 and by 21% from 1978.

Further, average fuel economy has increased by 42% over the past 20 years, along with average horsepower, because of technical innovations that make today’s ICE vehicles more powerful and more economical than ever before. From Wolf:

“Since 1975, fuel economy for highway driving doubled from 14.6 mpg to nearly 30 mpg in 2023!”

More: (emphasis by Wrongo)

“With less demand for gasoline domestically, the US has become a significant exporter of gasoline….Exports of gasoline, diesel, and jet fuel accounted for about 21% of the record 10.1 million barrels per day of crude oil and petroleum products that the US exported in 2023.”

Where will gas consumption go from here? Biden says we should be at zero emissions by 2050. How will we replace the tax receipts from federal and state gas taxes?

Enough. Let’s punt on the election and on the debate over EV cars. It’s time for our Saturday Soother, when we take a break from the assault on our consciousness by media and social media, and instead, focus on calming ourselves before launching into another week of disinformation.

Here at the Mansion of Wrong, we’re planning for projects on the Fields of Wrong, preparing for a meeting with our yard guys. We’ve finally convinced them that because of global warming, yard work must begin in early March rather than in early April.

To help you get centered on this Oscars weekend, grab a seat by a big window, then watch and listen to famed conductor Michael Tilson Thomas lead the USA’s National Youth Orchestra in a 2018 performance of Aaron Copland’s “Hoe-Down” from his ballet “Rodeo” in Beijing:

Osnos Finds Biden’s Sharp Despite His Age

The Daily Escape:

West Quoddy Head Light, Lubec, ME – February 2024 drone photo by Rick Berk Photography

Wrongo has lots of time for Evan Osnos, a writer for the New Yorker. Osnos wrote a great book “Wildland: The Making of America’s Fury”, a detailed look at America’s reactions to 9/11 and to the Jan. 6 storming of the US Capitol. He follows the lives of a few people that reveal how we lost the ability to see ourselves as part of a cohesive society. Highly recommended.

Apparently, Osnos is one member of the media that Biden is willing to spend time with. In a New Yorker article, Osnos offers a look into Biden’s state of mind as the 2024 election silly season begins. Osnos writes:

“If you spend time with Biden these days, the biggest surprise is that he betrays no doubts. The world is riven by the question of whether he is up to a second term, but he projects a defiant belief in himself and his ability to persuade Americans to join him….”

“Now, having reached the apex of power, he gives off a conviction that borders on serenity—a bit too much serenity for Democrats who wonder if he can still beat the man with whom his legacy will be forever entwined. Given the doubts, I asked, wasn’t it a risk to say, “I’m the one to do it”? He shook his head and said, “No. I’m the only one who has ever beat him. And I’ll beat him again….”

Osnos thinks that for Biden, going against Trump is personal. After all, Trump tried to steal the presidency from him. Biden knows that Republicans have sold imaginary voter fraud to its voters to undermine the democratic process. Biden’s certain that he’s the best person to hold them at bay.

Biden knows that what Trump and the GOP are planning this fall is exactly what they did on Jan. 6, but with better planning.

The balance of the Osnos report is about Biden’s view of the upcoming election, about his view of Trump’s weaknesses, and about the negative polling on Biden’s policy stances and economic measures. Osnos asked Biden if it was possible for him to convert Trump supporters and others, given that he’s behind in the polls:

“Well, first of all, remember, in 2020, you guys told me how I wasn’t going to win? And then you told me in 2022 how it was going to be this red wave?….And I told you there wasn’t going to be any red wave. And in 2023 you told me we’re going to get our ass kicked again? And we won every contested race out there….In 2024, I think you’re going to see the same thing.”

Biden wants to make certain that we’re not going to buy into the 2022 red wave again. The NYT helped to push that narrative back then too just as it is today. Osnos, who wrote a book about Biden’s 2020 win, reflected on the changes brought about by age:

“For better and worse, he is a more solemn figure now. His voice is thin and clotted, and his gestures have slowed, but, in our conversation, his mind seemed unchanged. He never bungled a name or a date.”

Please. Will the American media just give Biden’s age a rest? John Harwood tweeted that the Osnos interview, like Harwood’s own last fall, “shows talk of his alleged mental decline as utter bullshit.”

No one should be a Pollyanna about Biden’s reelection chances – 2024’s gonna be a fight. Osnos reminds us:

“Biden should be cruising to reelection. Violent crime has dropped to nearly a fifty-year low, unemployment is below four per cent, and in January the S&P 500 and the Dow hit record highs. More Americans than ever have health insurance, and the country is producing more energy than at any previous moment in its history.”

But today, the two Parties have wildly different intentions for the country and have very similar levels of support. In 2020, seven states hinged on a difference of less than three percentage points. Everything will come down to improving turnout on the margins.

Osnos also talked to a Biden campaign staffer, Mike Donilon, about a “freedom agenda”:

“It’s easy to miss how unusual a “freedom agenda” is for a Democratic Presidential campaign. Since the nineteen-sixties, Republicans have held fast to the language of freedom—from the backlash against civil rights to the Tea Party to the Freedom Caucus. But….he sees an opportunity for Democrats to…lay claim to the freedom to “choose your own health-care decisions, the freedom to vote, the freedom for your kids to be free of gun violence in school, the freedom for seniors to live in dignity.”

He also interviewed Bruce Reed, a close Biden aide who talks about how to bridge the ideological divide:

“We live in abnormal political times, but the American people are still normal people. Given a choice between normal and crazy, they’re going to choose normal.”

This is a distilled message that Biden can use in the election: Trump and his anti-Constitution, anti-rule-of-law, anti-democracy cult will sure as hell try to steal your vote this fall to install Trump. Remind voters that it’s not just an abstract: Democracy is certainly on the line this fall, and if Trump returns to power, he intends to gut your freedoms.

We could all help Biden by asking our friends what are they prepared to do?

35% of Americans Meet The Criteria To Be Middle Class.

The Daily Escape:

Stoney Brook Grist Mill, Brewster, MA – February 2024 photo by Michael Kerouac

Wrongo and Ms. Right spent Sunday with one of our daughters and son-in-law. We spoke about the Ezra Klein op-ed in the NYT about why Biden should step aside. One of Klein’s points is that in presidential campaigns, the candidate is always the campaign’s biggest asset, and that Biden isn’t being used by Democrats as if he is their biggest asset.

Elsewhere, some pundits are saying that the Democrats need to forget campaigning on policy: Dems always try to find things people like and tell them they’re going to help them — and after that, show them the candidate’s character, biography, and qualifications for office.

Instead, the Republicans campaign by appealing more to emotion than intellect, using a negative message to develop enthusiasm.

While Wrongo is happy that Dems want to campaign again on an anti-Trump message, he still thinks policy is the right way to appeal to at least two types of voters: Those who rarely vote, and those who voted Democratic last time but are less enthusiastic this time. These voters think our political system hasn’t produced results for them, and they’re looking for promises to change that in order to get their votes.

While we keep touting Biden’s economic performance, Wrongo recently found a very important poll taken last November by the WaPo that asked Americans how they defined being in the middle class:

“About 9 in 10 US adults said that six individual indicators of financial security and stability were necessary parts of being middle class….Smaller majorities thought other milestones, such as homeownership and a job with paid sick leave, were necessary.”

They also asked how many of those markers of being in the middle class people said they had achieved, and the results are a staggering rejection of how well the US economy is working for many people:

“Just over a third of Americans met all six markers of a middle-class lifestyle. While about 9 in 10 Americans had health insurance, only three-quarters had health insurance and a steady job. With each added measure of financial security, more Americans slipped away from the middle-class ideal.”

Let’s get into the findings. Here’s the WaPo chart about what factors Americans think it takes to be in the middle class:

It’s arbitrary to pick six, but they were the most frequently mentioned. A secure job. The ability to save. To afford an emergency. Paying the bills without worrying. Healthcare. Retirement. It’s a sensible list. And in the poll, huge majorities agreed those are the key criteria for a middle class life.

The Very Big Problem with this is that when the WaPo asked the same respondents if they had the ability to meet those criteria, the numbers are startling. Here’s the second WaPo chart:

Just 35% of people say that they meet the criteria that almost everyone, (~90%) agree should make someone middle class. If that’s true, America needs to redefine “middle” class. The majority in this survey did not have the financial security associated with being in the middle class. More from WaPo:

“The most common barrier was a comfortable retirement, something that about half of middle-income Americans over 35 felt they were on track to achieve.”

Think about what this research is really showing us. America no longer has a middle class. While ~90% of people agree on what a middle class life is, only a minority can afford it. This means we have a “phantom” middle class: Americans want to be middle class, but only a minority of them are. So what class does that make the majority?

What this research appears to show is that America is building something more like a permanent underclass.

Acknowledging this issue would be a great starting point for Biden to gain traction with low propensity voters and with the Gen X and younger voters who make up most of the low enthusiasm cohort of Democratic voters.

As Anat Shenker-Osorio puts it:

“Democrats rely on polling to take the temperature; Republicans use polling to change it.”

This time around the Democrats need to emulate Republicans who work at moving the needle instead of chasing it. And this middle class problem is an issue that will move the needle.

Fortune Magazine’s Tiffani Potesta writes that Gen Xers personify the problem of middle class life: (emphasis by Wrongo)

“Gen Xers expect to keep working longer than they planned–and will be the first generation to go into retirement with less financial security than their parents and grandparents.”

Gen X will be the first to reach retirement under a new paradigm: the widespread move from Defined Benefit plans to Defined Contribution or 401(k) plans in the US. This is a barely cited yet fundamental societal change that shifted the responsibility to save for retirement from employers to individual employees. More:

“…the numbers do not add up: Gen Xers reported that on average they will need roughly $1.1 million in savings to retire comfortably, yet they expect to stop working with only about $660,000 saved–a savings gap of around $450,000.”

Still more:

“According to a report from the National Institute on Retirement Security, the average account balance in 2020 for private retirement accounts among working Gen Xers was $129,994. This is woefully short of the amount of savings most of us will need to be secure in retirement.”

What’s worse is that the median account balance was scarier: $10,000–and 40% have zero savings.

For a society to be staring at the next few generations not being able to retire and not to be members of the middle class is very troubling, particularly in terms of what’s likely to happen if that’s the case. Losing our middle class is almost a sure path to autocracy, possibly through the rise of fascism and/or authoritarianism.

Biden and the Democrats need to acknowledge these problems are real and pledge to do everything possible to return America to having a true, bell-curve shaped middle class. They can run generally against Trump as “order vs. chaos”, but Trump is running on “America’s decline”, which includes the financial insecurity of millions of Americans. Biden needs to call that out specifically, along with ideas on how to fix the problem. That would make financial insecurity an issue for Democrats equal to abortion, something that targets a specific group and encourages them to get to the polls in November.

If Bernie Sanders isn’t too old to rage against economic insecurity, then Biden is old enough to do the same.

The Wrongologist

Geopolitics, Power and Political Economy

Category: Economic Policy

Harris Needs To Speak To Gen Z’s Reality

The Gap Between Economic Statistics (good) vs. People’s Perception Of Economic Situation (terrible)

Democrats Are Better For The Economy