Last week, it seemed as if every cartoonist wanted to draw something about the Baltimore Key Bridge, or about Trump’s bibles. Here’s the best of the lot.
Bridge collision brought some elephants to reality:
Some saw it as a metaphor:
Trump reduced to schilling:
It could have been worse:
The Biden Impeachment failed:
Suck it up, buttercup:
Capitalism is no longer ready for prime time:
The Daily Escape:
Cholla Cactus at sunrise, Joshua Tree NP – November 2023 photo by Michelle Strong
Yesterday’s column described how confusing current polling data is with less than a year to go before the 2024 presidential election. We can easily overdose on polls, but in general, they seem to be pointing toward a very difficult re-election for Biden.
At the risk of contributing to the OD, here’s another example of terrible poll for Biden. It comes from Democratic stalwarts Democracy Corps, run by James Carville and Stanley Greenberg:
“President Biden trails Donald Trump by 5 points in the battleground states and loses at least another point when we include the independent candidates who get 17% of the vote. Biden is trying to win these states where three quarters believe the country is on the wrong track and 48% say, “I will never vote for Biden.”
What to make of all this? Wrongo thinks it’s time to take a different approach to the Democrat’s messaging. Let’s start with a quick look at the NYT’s David Leonhardt’s new book, “Ours Was the Shining Future”. Leonhardt’s most striking contention is based on a study of census and income tax data by the Harvard economist Raj Chetty: Where once the great majority of Americans could hope to earn more than their parents, now only half are likely to. From The Atlantic:
“Of Americans born in 1940, 92% went on to earn more than their parents; among those born in 1980, just 50% did. Over the course of a few decades, the chances of achieving the American dream went from a near-guarantee to a coin flip.”
As we said yesterday, the American Dream is fading. Leonhardt says that the Democrats have largely abandoned fighting for basic economic improvements for the working class. Some of the defining progressive triumphs of the 20th century, from labor victories by unions and Social Security under FDR to the Great Society programs of LBJ, were milestones in securing a voting majority. More from The Atlantic:
“Ronald Reagan took office promising to restore growth by paring back government, slashing taxes on the rich and corporations…gutting business regulations and antitrust enforcement. The idea…was that a rising tide would lift all boats. Instead, inequality soared while living standards stagnated and life expectancy fell behind…peer countries.”
Today, a child born in Norway or the UK has a far better chance of out-earning their parents than one born in the US. More context from The Atlantic: (emphasis by Wrongo)
“From the 1930s until the late ’60s, Democrats dominated national politics. They used their power to pass…progressive legislation that transformed the American economy. But their coalition, which included southern Dixiecrats as well as northern liberals, fractured after…Johnson signed the Civil Rights Act of 1964 and the Voting Rights Act of 1965. Richard Nixon’s “southern strategy” exploited that rift and changed the electoral map. Since then, no Democratic presidential candidate has won a majority of the white vote.”
The Atlantic makes another great point: (emphasis by Wrongo)
“The civil-rights revolution also changed white Americans’ economic attitudes. In 1956, 65% of white people said they believed the government ought to guarantee a job to anyone who wanted one and to provide a minimum standard of living. By 1964, that number had sunk to 35%.”
America’s mid-century economy could have created growth and equality, but racial suppression and racial progress led to where we remain today.
Leonhardt argues that what Thomas Piketty called the “Brahmin left” must stop demonizing working-class people who do not share its views on cultural issues such as abortion, immigration, affirmative action and patriotism. From Leonhardt:
“A less self-righteous and more tolerant left could build what successfully increased access to the American Dream in the past: a broad grass-roots movement focused on core economic issues such as strengthening unions, improving wages and working conditions, raising corporate taxes, and decreasing corporate concentration.”
Can the Dems adapt both their priorities and messaging to meet people where they are today?
The priorities must change first. What would it take to establish the right priorities for the future? Stripping away the wedge issues that confuse and divide us, America’s priorities should be Health, Education, Retirement and Environment (“HERE”). It’s an acronym that sells itself: “Vote Here”.
(hat tip to friend of the blog, Rene S. for the HERE concept.)
Wrongo hears from young family members and others that all of the HERE elements are causing very real concerns. Affordable health care coverage still falls short. Regarding education, college costs barely seem to be worth shouldering the huge debt burdens that come with it.
Most young people think that they have no real way to save for retirement early in their careers when there’s the most bang for the buck. They also feel that Social Security won’t be there for them. From the NYT:
“In a Nationwide Retirement Institute survey, 45% of adults younger than 27 said they didn’t believe they would receive any money from the program.”
Today, only about 10% of Americans working in the private sector participate in a defined-benefit pension plan, while roughly 50% contribute to 401(k)-type, defined-contribution plans.
Finally, people today feel that their elders have created an existential environmental threat that will be tossed into their laps. A problem for which there may not be a solution.
As Leonhardt argues, these HERE problems should have always been priorities for Democrats. But for decades, the Party hasn’t been willing to pay today’s political price for a long term gain in voter loyalty. That is, until Biden started working on them in 2020.
But every media outlet continues to harp on inflation and the national debt. Much of what would be helpful in creating a HERE focus as a priority for Democrats depends at least somewhat on government spending. No one can argue that our national debt is high. It is arguable whether it can safely go higher or if it must be reigned in at current levels.
To help you think about that, we collected $4.5 trillion in taxes in 2022, down half a $trillion vs. what we collected in 2021. Estimates are that the Trump tax cuts cost about $350 billion in lost revenue/year.
Looking at tax collections as a percentage of GDP, it’s less than 17% in the US, well below our historical average of 19.5%. There are arguments to keep taxes low, but if you compare the US percentage to other nations, Germany has a ratio of 24%, while the UK’s is 27% and Australia’s is 30%.
If we raised our tax revenue to 24% of GDP, which is where Germany is now, we would eliminate the US deficit.
There’s a great deal of tension in the electorate between perception and reality. And it’s not caused by partisanship: Democrats and independents are also exhibiting a disconnect, too.
Democrats have to return to being the party of FDR and LBJ. They need to adopt the HERE priorities and build programs around them.
The Daily Escape:
Comb Ridge, UT & AZ – July 2023 photo by RC Bullough Photography
Wrongo and Ms. Right were urban pioneers in NYC in the early 1980s. We rented a loft on Maiden Lane in the financial district. Back then, we had to go uptown or to Hoboken, NJ for groceries because there were so few people living amongst the downtown forest of office towers.
But by the 2020 census, lower Manhattan was the fourth fastest-growing residential neighborhood in NYC. Since the pandemic, downtowns have looked more like the ghost towns of the 1980s with so many workers adapting to remote work. And they seem to be staying away.
Things are going to get interesting. We may be at the beginning of a massive structural change, not just a temporary blip impacting office towers: It seems that companies have figured out they won’t ever need this vast amount of vacant office space. Brookings says that office utilization averages less than 50% across major US downtowns. While The Gothamist reports that national office vacancies are at a high of 19.2% (compared to 12.6% in early 2020). They also report that McKinsey predicts that remote work will erase $800 billion from urban office real estate values.
This has many cities thinking about conversion of office space into residential space. In NYC, 25 Water Street, which was once home to the Daily News and JPMorgan Chase, has a plan to gut the offices, carve out courtyards and add 10 floors to the 22-story structure. GFP Real Estate and Metro Loft bought the building, formerly known as 4 New York Plaza, in December for about $250 million.
One loophole is that the Financial District doesn’t require that the conversions include any affordable housing. So this project will not have any apartments with capped rents for low-income units. That isn’t true in other parts of the City, like Midtown, Queens or the Bronx.
Boston is testing an incentive program for developers to convert empty downtown offices into housing. Mayor Michelle Wu announced that the owners of repurposed buildings could get up to 75% off on their property taxes. Boston’s office market vacancy rate climbed to 14.2% in the second quarter, the highest level in 20 years, according to data from CBRE Group Inc. And median monthly rent for a one-bedroom apartment has jumped 8% in the past year to $2,800.
Boston’s downtown has about half of the city’s office space. An October 2022 report commissioned by the city found that economic activity downtown remained 20% to 40% below pre-pandemic levels for industries like retail.
Back in NYC, Mayor Eric Adams is also proposing incentives to designate 136 million square feet of office space for conversion to residential development. It’s worked before: A 1995 tax break for conversions helped create 13,000 new apartment units in Lower Manhattan.
Brookings raises the question of what the taxpayers’ interest should be in these conversions:
“To what extent are current high office vacancies a market problem whose burden falls on the private sector (property owners and investors) and to what extent do they represent a market failure and policy problem to which government must respond with financial support from the public?”
The advocates of tax breaks and other financial incentives say it will:
It seems that office-to-home conversions are no more a comprehensive remedy for housing than e-bikes are for transit issues. Few office buildings are truly suited for conversion. It’s often more straightforward for developers to knock down the existing structure and build condos from scratch.
Moreover, the best thing that cities can do to encourage more housing is to loosen zoning restrictions, allowing multi-use and apartment buildings to be developed rather than just supply tax breaks.
The battle lines are drawn. The 25 Water St. developer said state and city lawmakers will have to pay up if they actually want to turn vacant offices into homes:
“The politicians, if they want to create housing in New York City out of these buildings, they will need to provide significant incentives….And if they want to provide affordable housing, those incentives would have to be even higher.”
Time to wake up America! We can’t let our mayors give away more tax revenues to developers! We’re unsure if the current rate of office utilization will improve or not, so cities need to be smart about what they do next. To help you wake up, we dust off an oldie. Here are the Rolling Stones with “Salt of the Earth” from their album “Beggars Banquet”. Performed live at the Rolling Stones Rock and Roll Circus in 1968. This was the first tune where Keith Richards had the lead vocal:
Sample Lyric:
Raise your glass to the hard-working people
Let’s drink to the uncounted heads
Let’s think of the wavering millions
who need leaders but get gamblers instead
The Daily Escape:
Sunset, Monument Valley, AZ – April 2023 panoramic photo by Rich Vintage Photography
The ripples from Trump’s appearance on CNN continue. Politico reports that: (brackets by Wrongo)
“Nearly under his breath….Trump said that he and…Putin “used to talk about” Moscow’s intention to launch [an] invasion in Ukraine.”
What’s Trump talking about? The invasion happened in February 2022, more than a year after Trump left office. In fact, Russia didn’t even begin massing troops on the Ukraine border until March 2021 while Trump was already at Mar-a-Lago. Russia’s troops were partially withdrawn by June 2021, although the military infrastructure was left in place. The second build-up began in October 2021, lasting until the invasion in February 2022.
Politico says that Trump mumbled at some point, that he and Putin discussed Russia’s intention to launch a second, larger incursion of Ukraine. Was Trump talking to Putin about a possible invasion of Ukraine after Trump left office? If so, what are the chances that Trump shared his news with Biden?
Today, let’s spend a bit more time on one of the reasons why we must rebuild our energy grid. Wolf Richter of Wolf Street writes that in 2022, electric vehicles (EVs) made their first visible dent in US gasoline consumption: (parenthesis by Wrongo)
“Gasoline consumption in the US dipped by 0.4% in 2022…(vs.2021) to 369 million gallons per day…. below where it had been in 2002, and down by 5.7% from 2019, and by 5.9% from the peak in 2018, according to data from the Energy Department…”
Wolf reminds us that employment grew in 2022 by 4.8 million. And miles driven by all passenger and commercial vehicles, including those powered by diesel, ticked up nearly 1% to 3.17 trillion miles in 2022, according to the Federal Highway Administration:
Miles driven still haven’t recovered to 2019 levels (-2.8%). That’s probably due at least in part to reduced commuting during the Covid Work From Home times. Now, many office workers are either working from home entirely, or are going into the office on some days and working at home on others.
So the data show that the economy grew and people drove more miles, but they bought less gasoline:
The above chart shows the impact of the various recessions on gasoline consumption. The deep dip in 2020, and the 2021 recovery only brought gas consumption back to 2002 levels. Then they fell off again in 2022.
The question is why wasn’t there a further recovery in gas consumption from 2021 to 2022? One factor is the rising fuel economy of American vehicles. This started many years ago, and it continues today. But Richter says that the growth in ownership of EVs has dented US gasoline consumption:
“EV sales in 2022 grew to a share of about 7% of total new vehicle sales in the US. In California, EV sales in 2022 accounted for 17% of total sales. These numbers are starting to show up at the gas station as a decline in gasoline sales.”
Still a 7% share of market is small and for now, the impact on gasoline sales is also small in the US.
Another way to look at this is that while gas consumption declined, electricity sold to end-users in the US broke out of 15 years of stagnation and set a new record. The chart below shows that electric utilities have been a no-growth business for more than a decade, but now the volume of electricity sold is suddenly spiking:
Wrongo isn’t sure if these trends will continue, but continued growth in the number of EVs on America’s roads seems undeniable. EVs have lower energy costs and lower maintenance costs. That economic reality seems guaranteed to be sustained in the coming decades. The battery cost curve will continue to decline and the rare metals required in EV batteries are beginning to be helped by both new supply and changing battery chemistry.
Still, Wrongo isn’t a fan of EVs. Perhaps when EV charging stations become ubiquitous, he will reconsider. And there will be a place for the ICE engine for a very long time.
That’s enough for this week. It’s time for our Saturday Soother, where we disconnect from the crisis du jour and spend a few relaxing moments before charging headfirst into whatever next week brings. Here at the Mansion of Wrong, we’re off to the garden store to find vegetable plants for our puny garden.
It looks like a beautiful weekend in the northeast, so grab a chair outside and watch and listen to Manuel De Falla’s Danza from “La Vida Breve” (Life is Short or The Brief Life). It is from Falla’s 1905 opera. Here it is performed live at the ancient Roman Theatre in Cartagena Spain, by Paola Requena and Isabel Martínez who perform as the Carmesí Guitar Duo:
The Daily Escape:
Bright Angel Trail, Grand Canyon NP – February 26, 2023 photo by Adam Schallau Photography. The Grand Canyon NP was created on 2/26/1919.
There’s lots of talk about America’s need to move away from traditional sources of energy to renewable energy. Wolf Richter gives us some perspective: (brackets by Wrongo)
“Electricity generation, as measured in gigawatt-hours, [faced] near-stagnation in demand since 2007, as efforts to make everything more efficient…produced results…[but]…These upfront costs by electricity users…reduced electricity consumption. For electric utilities, it meant that they were stuck in a demand quagmire….But…in 2022…electricity generation rose by 3.5% from 2021, to a new record of 4,297,000 gigawatt-hours…”
Wolf helpfully provides a chart of electricity generated by type:
The decline in coal and the remarkable increases in natural gas and renewables are easy to see. The renewables category includes wind, hydro, solar, geothermal, and biomass.
The green line above is for nuclear power, which very few people think of as a “green” source of power generation. Wrongo believes we need to reconsider nuclear power if we are to hit our ambitious targets for lowering greenhouse gas emissions in the next few decades.
Jonathan Rauch in The Atlantic has a long and well-reasoned article about how, after a decade of regulatory and financial uncertainty, small modular light-water nuclear reactors are getting closer than ever to commercialization. Rauch describes the vision is for small nuclear reactors:
“Forget about those airport-scale compounds…and 40-story cooling towers belching steam. This reactor will sit in an ordinary building the size of…a suburban self-storage facility. It will be mass-produced in factories for easy shipping and rapid assembly. Customers will be able to buy just one, to power a chemical or steel plant, or a few, linked like batteries, to power a city.”
Given new technologies currently in advanced testing, even if a local disaster cuts the power to the reactor cooling system, this new type of reactor will not melt down, spew radioactive material, or become too hot and dangerous to approach. It will remain stable until normal conditions are restored.
But for decades, nuclear has flopped as a commercial proposition. It has broken its promises to deliver new plants on budget and on time. And despite an enviable safety record, the public still fears catastrophic accidents. The Three Mile Island plant’s partial meltdown in 1979 was the US nuclear industry’s worst accident. Although no one died or was injured, it hardened the public and environmentalists against increasing the use of nuclear power in the US. In fact, the plant’s second reactor operated without problems until 2019 when it was decommissioned. Today legacy nuclear power supplies about 18% of American electricity, and the US has fired up only one new nuclear power reactor since 1996.
It seems perverse to avoid nuclear, since it’s carbon-free, and as few realize, very safe. Only the 1986 accident at Chernobyl has caused mass fatalities from radioactivity. Remember, that plant was subpar and mismanaged by Western standards.
Excluding Chernobyl, the total number of deaths attributed to a radiation accident at a commercial nuclear power plant is zero or one, depending on your interpretation of Japan’s 2011 Fukushima accident. Yes, more than 2,000 people may have died in Fukushima, but most of that happened during the evacuation.
Solar and wind have huge problems because of how much land they require. According to Armond Cohen of the Clean Air Task Force, meeting all of the eastern US’s energy needs requires 100,000 square miles of solar panels, an area larger than New England. Wind is worse: It requires more than 800,000 square miles of onshore windmills to meet the eastern US power needs, an area the size of Alaska plus California. NIMBY opposition will prevent the building of sufficient power generation from wind and solar.
Contrast this with the space required by small nuclear reactors: They would take up about 500 square miles of nuclear plants, equal to the size of Phoenix, Arizona to power the eastern US.
Dozens of companies and labs in the US and abroad are pursuing small nuclear plants. GE Hitachi Nuclear Energy has a signed agreement to build the first grid-connected small modular reactor (SMR) for Ontario Power Generation. It will be a 300-megawatt light-water SMR in Ontario, Canada.
NuScale Power, a pioneer in small reactors, cleared the ultimate US regulatory hurdle when the US Nuclear Regulatory Commission certified the design of NuScale’s 50-megawatt power module. It’s the first design ever approved for use in the US. The US Department of Energy is helping to fund NuScale’s project at the Idaho National Laboratory, including $1.35 billion in funding. The first of six clustered SMRs at the site is expected to go online in 2029, with the rest expected to follow in 2030.
Biden’s Inflation Reduction Act also provides a tax credit for advanced nuclear reactors and microreactors.
Ultimately, choice of energy generation will come down to cost. Solar is widely deployed today because it’s the lowest-cost generation source. But how can it scale?
If SMRs can demonstrate a cost advantage in real-life operation, orders will follow. And the long-promised nuclear renaissance might actually arrive.
Along with a better shot at a low carbon future.
The Daily Escape:
Sunrise, with Mt. Hood in background, Vancouver, WA – November 2022 photo by Sanman Photography
The NYT has an article showing how the US tolerates a high number of auto-related deaths:
“The US has diverged over the past decade from other comparably developed countries, where traffic fatalities have been falling….In 2020, as car travel plummeted around the world, traffic fatalities broadly fell as well. But in the US, the opposite happened. Travel declined, and deaths still went up. Preliminary federal data suggests road fatalities rose again in 2021.”
They helpfully include a chart that shows America’s relative ranking vs. other developed countries since the start of the pandemic in 2020:
(chart is truncated for viewing purposes)
More from the NYT:
“Safety advocates and government officials lament that so many deaths are…tolerated in America as an unavoidable cost of mass mobility. But…Americans die….in rising numbers even as roads around the world grow safer.”
In 2021, nearly 43,000 people died on American roads. The recent rise in fatalities has been highest among those the government classifies as most vulnerable — cyclists, motorcyclists, pedestrians, even though miles traveled have fallen:
The NYT says that the explanation for America’s road safety record lies with a transportation system designed to move cars quickly, not to move people safely. They quote Jennifer Homendy, chair of the National Transportation Safety Board:
“Motor vehicles are first, highways are first, and everything else is an afterthought…”
To fix this means we must solve both infrastructural and cultural problems at the same time.
This year in our northwestern Connecticut town, we’re seeing an average of 3 accidents per day compared with 2.2 per day last year. Our population is growing, but certainly not as fast as our accident rate.
The explanation for the increases both locally and nationally isn’t simple to explain.
The average car sold in the US is larger, taller, and heavier than in other developed countries. Many of these SUVs and trucks can weigh up to 9,000 pounds, like the latest Rivian and the electric Hummer. Their batteries alone weigh 3,000 pounds, the weight of the average car in the 1990s!
The larger size offsets the advancements in safety technology. Add in growing distracted driving: texting, work calls, difficult to navigate infotainment systems that lack physical buttons. And deaths are up in America.
In the 1990s, per capita roadway fatalities across developed countries were significantly higher than they are today. Back then, the US had fewer than South Korea, New Zealand, and Belgium. But other countries started to take pedestrian and cyclist injuries seriously in the 2000s. They made them a priority in both vehicle design and street design in a way that the US has never committed to.
In America, we prioritize straighter, smoother roads. We prioritize traveling long distances by car as fast as possible. Our culture and our infrastructure are designed to allow us to go faster on better roads. That has made us number one in road vehicle-caused deaths since the pandemic.
More American Exceptionalism! And given our exceptionalism in firearm fatalities, it’s hard to see how or why Americans would be willing to stop being exceptional in vehicle deaths either.
Biden’s infrastructure bill, passed last year, takes baby steps toward changing this. There’s more federal money for pedestrian and cycling infrastructure. And states are now required to analyze fatalities and serious injuries among “vulnerable road users” (people outside of cars) to identify the most dangerous traffic corridors and the potential ways to fix them.
States where vulnerable road users make up at least 15% of fatalities must spend at least 15% of their federal safety funds on improvements prioritizing those vulnerable users. Today, 32 states, plus Puerto Rico and DC, will have to meet this mandate.
Here in our CT town, Wrongo serves on the Municipal Roads Committee. We talk endlessly about how, once a road is repaired, speeds immediately go up. It took several years and much public disagreement to build a roundabout as a traffic calming measure on one accident-prone road.
In Europe, you see plenty of “traffic calming” measures. Chicanes, roundabouts, and narrower lanes bring vehicle-pedestrian fatalities down, in part by making drivers pay more attention. Therefore, driving becomes a bit more nerve-wracking, and people go slower.
Making that happen here would require Americans and politicians to buy into the idea that streets aren’t exclusively for cars.
The Daily Escape:
Aerial view of sunset at Cathedral Rock just after snowstorm, Sedona, AZ – February 2022 photo by mattymeis
Wrongo will leave it to others to deeply analyze Biden’s State of the Union speech. Biden clearly doesn’t have the oratory skills of Obama, or a Reagan. He’s more like Carter, or GHW Bush. He is, however, a better public speaker than Mitch McConnell.
Biden’s performance was pretty solid for a guy facing down fascism, both here at home as well as abroad. He didn’t attack his predecessor. He didn’t mention Jan. 6. That means he knows that what really matters isn’t shouting at his political adversaries, but talking over the heads of Congress to the nation.
But let’s take a prospective look at a few of the issues that may make or break Biden’s second year and likewise, cost the Democrats their majorities in both Houses of Congress in November. He’s facing one global crisis (the pandemic) that’s fading, and another (Russia’s invasion of Ukraine) that’s escalating.
In his first year, Biden presided over a robust economic recovery. It did create inflation, bringing higher prices for everything from housing and food to cars and gasoline. Here are a few of the challenges and opportunities for Biden in 2022:
Inflation. Biden adopted an aggressive, populist approach to beating inflation in his speech. In particular, saying that “Capitalism without competition is exploitation—and it drives up profits” was a great way to speak to the average American. The Fed’s interest rate hikes in 2022 will help.
Gas prices. The cost of fuel, electricity and power was 3.8% of average disposable income in January 2022. This is about where it was in late 2018, when Trump was president. Vehicle fuel efficiency means $3.50/gal. gasoline isn’t the scourge it once was. But, with the oil markets at above $100 a barrel because of Russia’s invasion of Ukraine, Biden may have a difficult time convincing voters they’re better off.
The supply chain. The shipping logjam is still with us. The Port of Los Angeles processed 7 million 20-foot equivalent shipping containers last year, surpassing the previous record set in 2018 by 13%. But that system isn’t built to handle the spike in demand caused by people buying more goods than services in 2021. Our supply chain is controlled by private companies including port operators, labor unions, the rail and trucking industries, and the large shippers that rely on their services. It’s unclear what Biden can do to reduce shipping costs.
Homicides. Americans are killing each other at rates not seen in decades. The sense that crime is out of control is and will continue to be a drag on Biden’s approval ratings, especially among Republicans and Hispanics. The current wave of killings began before Biden took office in 2021, and other measures of crime haven’t shown increases. There’s little Biden can do to turn this around.
Illegal border crossings. The 1.66 million migrants seeking to cross the US-Mexico border illegally in the 12 months through September, are the highest number since 2000. But Biden isn’t doing as bad a job as Republicans say. The Migration Policy Institute estimates that the actual number of successful unlawful entries in 2021 was less than one-fourth the total in 2000. Customs and Border Patrol has greatly reduced the number of migrants who manage to sneak in. Biden says he will address the multiple year backlog in asylum cases by hiring more immigration judges.
Tax refunds will be late this year. Americans hate doing their taxes but love getting refunds. A Bankrate survey found that 67% of those expecting a refund said it was important to their finances and planned to either save it, or use it to pay down debt or for daily expenses. The IRS says they’re overwhelmed following pandemic-related challenges, years of underfunding, and additional duties such as administering stimulus payments. The IRS has added a “surge team” to help whittle the big backlog and speed refunds. But if long delays materialize, voters will only remember they had to wait for too long to get their money back.
Biden’s approval rating. Pundits think that unless Biden’s approval rating improves into the high 40%s in the next few months, Democrats risk a 2010-style bloodbath in November. We won’t know for a few weeks if Biden received a bump in his approval ratings post-speech. CNN’s post-speech poll shows that 67% of those who watched the speech say that Biden’s policy proposals would move the country in the right direction, with 33% saying we would go in the wrong direction. That’s in contrast with a survey conducted before the speech with the same people. They were closer to evenly split (52% right direction, 48% wrong direction).
Many of the challenges confronting Biden are not fully in his control. In addition to what are enumerated above, Biden can get a boost based on his handling of Putin’s War and the sanctions regime. That may offset the negative image of our Afghanistan withdrawal.
There are just 8 months until the mid-terms. Biden needs to move fast.
The Daily Escape:
Mesquite Dunes, Death Valley NP – November 2021 photo by Ed Kendall
Paul Campos asks: “Should Biden run again in 2024?” While Martin Longman asks what explains Joe Biden’s steep decline in the polls in the latter half of 2021?
Jonathan Chait has an idea:
“Nobody can say with any confidence if this fall can be reversed. Indeed, given the US’s steady job growth, nobody can ascertain exactly why the public has turned so sour so fast. Biden is like a patient wasting away from some undiagnosable disease. What is clear is that if the presidential election were held this fall, Biden would enter the contest as the decided underdog against Trump.”
All of us have been on the wrong side of failing someone’s unstated expectations. We didn’t know we were taking a test; we didn’t know our actions were being scored, and naturally, we failed. That’s where Biden is today. Regardless of the analysis, it seems clear that Biden would lose an election to a Republican if it were held today, probably even to Trump.
But the reasons for Biden’s poor poll numbers are at least to Wrongo, unclear. At the 2020 presidential election, people were crying out for a return to normalcy. Back to Campos:
“It’s clear that a big underlying reason for Biden’s success in 2020 was a widespread…belief/hope among voters…that electing an anodyne middle of the road elderly white man — you know, a normal person, as opposed to a woman or a minority or a Jewish radical leftist [sic] — would calm things down after all the Trump craziness, and the Republican party would at least trend back toward being a center right party…”
We didn’t return to normal, and maybe, there isn’t a normal to return to. If that’s true, “Make America Great Again” will again have tons of appeal.
Wrongo detects among Democrats a perception that Biden and the Democratic Party are all in on tying their policies to racial justice. While that’s well-intended, and good strategy for energizing the base of People Of Color, it’s causing some dissatisfaction among Whites and certain Hispanic sub-segments.
That showed in this year’s Virginia and New Jersey elections. White suburban women moved away from the Dems in both states.
In Passaic, NJ, Hispanics make up about 70% of the population. Trump won 22% of their vote in 2016, and 36% in 2020. The 2021 Republican candidate for governor won a similar percentage. A Republican won a seat on the county board of commissioners for the first time in more than a decade.
These results should be a wakeup call for Democrats.
A recent Pew Research study divided the electorate into nine affinity groups, four Republican, four Democratic and a disaffected group that didn’t fit well into either Party’s coalition. Pew found that among: (brackets by Wrongo)
“….the four Republican-oriented typology groups…[fewer]…than…a quarter say a lot more needs to be done to ensure equal rights for all Americans regardless of their racial or ethnic background; by comparison, no fewer than about three-quarters of any Democratic group say a lot more needs to be done to achieve this goal.”
This gulf on one of the central questions facing our nation suggests that for now at least, Republicans have a powerful message to take to Independents and undecideds in the mid-terms and beyond. From Tom Sullivan:
“The MAGA squad on Capitol Hill sees waging culture war as the very point of holding political office: stoking anger, provoking fights, “owning the libs,” and advancing conspiracy theories.”
Everything isn’t about Dems being too pro-equality. Things like the withdrawal from Afghanistan, inflation, the supply chain disruptions, and the Delta variant of Covid have something to do with Biden’s poor numbers, along with no prospect of returning to normal.
Should Biden not run in 2024? Do the Democrats have a viable national candidate who could step into Biden’s shoes? Having a president candidate in their early to mid-80s, like Biden will be, isn’t optimal. That would seem to rule out both Sanders and Warren.
Kamala Harris looks to be doomed at least for now as a national candidate. She polls behind Biden. About the only thing low-information voters know about her are her gender and ethnicity. All else being equal, being nonwhite and female are probably national electoral handicaps this time around. She does appeal to many minority voters. But are there enough minority voters in swing states who would be willing to vote for her?
Given the ossification of the Democrats, the question of “Who should run?” feels like shuffling the deck chairs on the Titanic.
We’re one election away from permanent Republican rule that will bring with them “show elections”. So far, no Democrat with the exception of a few dark horses, like Transportation Secretary Pete Buttigieg or Connecticut Senator Chris Murphy, appear to have the smarts and charisma to be credible with the disaffected middle road of American voters.
Maybe the Dems have no realistic alternative to Biden in 2024.
Who do you think should run?
The Daily Escape:
Lone Rock, Lake Powell – November 11, 2021 photo by Ron Broad. This shows how dramatic the loss of water has been in the lake. One commenter said it was possible to boat completely around the Rock in July 2021!
The country is facing a series of problems that, if unresolved, point towards a bloodbath for Democrats in the 2022 mid-term election. An ABC poll, released this weekend should be a wake-up call. Here’s a chart showing early mid-term voting preferences by Party:
On a generic ballot, it shows that the Democrats and Republicans have swapped places since 2017. Today the Dems are supported by just 41% of those surveyed, down from 51% in 2017.
It’s true that relying on polls conducted of just 882 registered voters via landlines, as this poll was, isn’t the only thing Democrats should build their political strategy on. But ABC’s result is similar to others.
People are frustrated with the economy, because they see how everything is getting much more expensive, and they’re blaming the government and politicians. They’re not blaming the Federal Reserve’s expansive policies, because the polls never ask about the Fed, and because most people don’t understand how it works.
Consider this: 62% said the Democrats were out of touch with the concerns of most Americans. One dimly positive note was that Americans didn’t rate Republicans much better, with 58% considering them out of touch. The economy was among the key factors: 70% said the economy is in bad shape, up from 58% in the spring. About half blamed Biden for inflation. And his approval rating of handling the economy plunged to 39%, with 55% disapproving.
Biden doesn’t control prices, but try telling that to consumers. People who make a living by selling their labor have seen recent wage increases get eaten up by higher rents, home prices, food prices, gasoline prices and higher new and used-vehicle prices.
But you can always find an economist or a political writer who minimizes an impending political problem. That’s the kind of thing that Wrongo said yesterday was a bad strategy for Democrats. Here’s Dean Baker: (emphasis by Wrongo)
“The October Consumer Price Index data has gotten the inflation hawks into a frenzy. And, there is no doubt it is bad news. The overall index was up 0.9% in the month, while the core index, which excludes food and energy, rose by 0.6%. Over the last year, they are up 6.2% and 4.6%, respectively. This eats into purchasing power, leaving people able to buy less with their paychecks or Social Security benefits….While the stretch of high inflation has gone on much longer than many of us anticipated, there are still good reasons for thinking that inflation will slow sharply in the months ahead.”
Needless to say, if inflation continues at rates not seen since the 1970s until the 2022 election, no voter will see it as transitory and that won’t be good for Democrats.
Biden has signed his $1 trillion infrastructure bill, hoping that the legislation will help jump-start a Democratic political recovery. His infrastructure plan may not add to inflation, but inflation in the most important things that consumers either notice and care about – food, gasoline, cars, and houses – doesn’t seem transient.
Biden has a few tools at his disposal. He’s doing what he should to address the microeconomic aspects of inflation: trying to increase capacity at ports, expanding microchip production and he’s considering a release of raw materials from the National Defense Stockpile. The biggest lever he hasn’t pulled is a tariff reduction, especially on goods from China.
Richard Nixon instituted price controls in 1971, They were the first and only peacetime wage and price controls in US history. After a 90-day freeze, increases would have to be approved by a “Pay Board” and a “Price Commission,” with an eye towards lifting controls, conveniently for Tricky Dick, after the 1972 election. His action led to greater inflation, not something any of us should want to see.
From Jason Furman in the WSJ:
“Ultimately inflation is a macroeconomic problem. It’s the Fed’s job to keep it under control….Policy makers at the Fed need to recognize that tools like asset purchases can’t solve the supply-side problems constraining US labor markets and output. They have a dual mandate. They have to take inflation into account even if the economy isn’t yet at maximum employment.”
Biden can pick a different Fed Chair, and there’s an additional vacant seat on the Fed’s board.
Biden can also be jawboning America’s CEOs about gas and food prices. Otherwise, he has no cards to play. All he can do is wait for supply and demand to turn back toward equilibrium, and hope that it happens in the next six months. If inflation turns around, Biden will get some credit.
If it doesn’t, you could see President Trump waddle back into the White House in 2024.
The Daily Escape:
Early fall foliage, Long Pond, Rutland, MA – September 2021 photo by Jurgen Roth Photography
Charlie Sykes, talking about what will be a jam-packed week in Washington DC:
“This is going to be a helluva week. Democrats in Congress may not be able to save the Biden presidency, but they can destroy it…”
There are clear differences among Democrats on social spending priorities and the correct size of the pending human infrastructure spending bill. Several Democratic House members have vowed not to support both of Biden’s bills, unless they get what they want included. Along with threats by Sens. Sinema and Manchin not to stand with Democrats in the Senate, both House Speaker Pelosi and Senate Majority Leader Schumer can’t be happy trying to lead their fractious caucuses.
And among these efforts to thread the needle, are the twin crises of a Thursday cut-off of federal spending and a subsequent (possible) default on the nation’s debt.
Funding for the federal government is set to run out on Thursday at midnight. Senate Democrats will move a stopgap spending measure forward to position for a vote on the House-passed short-term funding bill. That would keep federal agencies open until Dec. 3, while suspending the debt limit until Dec. 2022.
Suspending the debt limit for another year is a great idea, but Senate Republicans are certain to tank that proposal. The likely scenario is that Senate Dems will remove the debt-limit provision and pass the bill with bipartisan support. Then, the House passes the bill, Biden signs it, and a government shutdown is averted for another two months.
But that leaves the debt-limit problem unresolved. We will reach that in early-mid October.
Mitch McConnell and Senate Republicans won’t support an increase in the debt limit. They say that Democrats should lift the cap on government borrowing on their own, as a part of their reconciliation package. But that creates a political advantage for the Republicans. And besides, it could take weeks, enough time to bring the country close to defaulting on its obligations. And it isn’t certain that Schumer has the votes to pass it without Republican help.
Only one thing’s certain: No one knows what’s really going to happen.
On infrastructure, Pelosi announced that debate on the Senate-passed bipartisan infrastructure bill would start on Monday. A House vote on it is slated for Thursday. House Democrats are also trying to make progress on the big reconciliation package.
Pelosi’s challenge is to keep progressives from walking away from the big bill and tanking the infrastructure bill. Democratic leadership also must appease Senate centrists about the size of the big infrastructure bill, which they say is too large.
House Democrats will meet late on Monday, (shortly after Wrongo posts this). Pelosi wants the members who’ve drawn lines in the sand about the human infrastructure bill (and who haven’t shown up for caucus meetings lately) to be there. From Politico:
“I urge the fullest participation of Members and hope that as many of us can be there in person as possible…”
These are strange days for Democrats. As a Sunday WaPo article said, “Political Suicide is not a Strategy”. In addition to the obsessive focus on securing the necessary votes in the House and Senate, the focus on the human infrastructure’s price tag is the essence of bad political messaging. Few Democrats stand up to say that the $3.5 trillion will be spent over 10 years, amounting to only 1.2% of GDP over that period.
Worse, focusing on the dollar amount takes attention away from the value in the bill for children, families, education, health care, housing, and climate. From Rep. Jim Himes (D-CT):
“When Democrats allow a debate to be only about a number, it’s like talking about a Christmas party and only discussing the hangover.”
The WaPo quotes Sen. Chris Van Hollen (D-MD) as saying that the discussion is getting things exactly backward:
“We should work from what policies we want to enact, rather than an arbitrary number.”
No one can forecast how this will all work out. It would be dandy if Republicans supported the debt ceiling increase.
It would also be dandy if they accepted the results of the 2020 election, got vaccinated and stopped passing voter suppression laws. A rational and patriotic Party would do those things. But those are a bridge too far for today’s Republican Party.
So, Democrats are on their own. We’ll soon see if they can stand together as a team to avoid disaster and deliver on Biden’s promises.