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There is something I really like in this Ygeslias article. Whatever is causing more partisan politics it’s not the economy. We’ve done well the past few years.
https://www.slowboring.com/p/how-obama-and-trump-and-biden-beat
Macroeconomic management has been actually really good the last 15 years. Someone can argue we could have had a few million more people employed between 2010-1016, but that’s like 2% of gdp. Trump did close that gap and I’m not sure if he was brilliant or lucky but he yelled at the Fed for being too hawkish.
I like how he led with the shale Revolution. I’ve been saying this for years. Tech gets all the fan fare but if Tech was the Jordan of the economy American energy independence over this time frame was the Scottie Pippen in creating wealth for America. I think part of the reason it doesn’t get the fanfare is because it doesn’t create 12 figure networth people. Its a constant costs business versus moat building business. Of course if the businesses are not as profitable then the surplus value went to consumers in the form of lower energy costs versus companies having high margins. Also likely led to America not needing to write giant checks to the Saudis which meant our trade deficit could fund other things and those depend more on price leading to the strong dollar. People working in constant-costs businesses (farming, manufacturing, energy) tend to vote red; people working in wide moat with ability to extract economic rents or winner take all markets tend to vote blue. Someday I should write a long article on this because I have not seen anyone write about it. But the split in voting patterns makes a lot of sense based on the economics of their business. It would even make sense to have different tax regimes for these businesses but would be impossibly hard to execute. As a driver of political views it seems as powerful as male-female splits which seems a lot more talked about.
I think maga and the left like to cite American wealth not making it to the middle class etc. But honestly this much wealth creation can’t just be consumed by the 1% it pretty much has to flow to others. Perhaps, the middle class isn’t doing as well as we want them to be doing but the counter factual (Europe) would be poorer than what we got.
The GDP numbers are more pronounced because we calculate things in currencies and the cited figures were when the dollar was weak. The gap has definitely shifted in favor of the US but I do think this overstates the change.
The Tea Party seems underrated to me. They put a halt to more government spending. Less fiscal policy meant the fed could keep rates lower which basically crowded-in private investment in tech and shale and a host of things with cheap money. The current situation is the opposite of this where we increased federal spending from about 20.5% last decade to 24% now. And that’s caused a massive change in rates to get inflation close to target.
Culture Wars seem to have little to do with economic mismanagement by either side. I think the right is correct that the fall of small towns is bad but I think that largely came from economic forces (like productivity) gains that couldn’t be prevented. And there small towns have also been hurt by the people (probably like myself) who would be logical local elites moving away.
As much as national divorce or something always sound appealing it’s just going to make us all poorer. To break up economic integration would make our economy much more like Europe. We would run into something like Brussels that is ineffective at macro management and lose the economy of scale.
Shale was a major mistake by the US. Shale oil is short lived compared to conventional oil with high decline rates and is expensive to extract. The shale boom will not be a long term solution. Shale caused a 10-20 year boom which will be followed by a decline. Meanwhile, the US is missing valuable years transitioning away from fossil fuels. The world is building public transit and high speed rail at record rates, the US is investing in short term shale oil as its long term energy solution. Cheap natural gas has allowed for construction of energy inefficient buildings and a lack of investment in efficient heating/cooling systems. The US is seriously lagging behind in walkable and bikeable cities due to cheap gas. Even when it comes to electric vehicles the US is somewhat behind
As for the energy grid, the US is lagging behind in nuclear with an older fleet of reactors than Europe and only 1 of 60 reactors planned for construction in the world are in the US. The US is lagging behind in renewables, and overall investments in the energy transition
The shale boom absolutely benefited the US. However, other parts of the world have ripped of a sizeable chunk of the bandaid regarding getting off fossil fuels.
The same entities that oppose shale also make nuclear expensive and hydro and everything. While there are some genuine green activists that would be happy with decarbonization, there are many more who use that as an excuse for the real goal of de-electrification.
Like some sort of primitivists? I go with mistake theory, I think it's more that leftism is virtually ignorant of the concept of trade offs. Any negatives are because of a lack of will; just get the right people in power and spend money and we can have zero carbon energy for our dense, walkable, clean, safe, cities.
Have a look at what certain people in the UK see as a viable and desirable vision for the future:
https://api.repository.cam.ac.uk/server/api/core/bitstreams/75916920-51f6-4f9c-ade5-52cbf55d5e73/content
Page 6 has a quick chart that explains their vision. No meat, no shipping, no airports, much less heating, much less road use, massive austerity in construction. They're big on electricity production though. And all of this (a 20-30 year Greater Depression) comes with an enormous price tag and mobilization of national resources! An apocalyptic vision if ever there was one.
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