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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.
I think that really most of the culture wars and the dislike of those who disagree feels more like a social class thing than anything really about politics. And as such, it’s not economics and economics won’t fix it.
The upper class of this country essentially wants to remake America to be much more like continental Europe. An open fairly liberated culture, walkable cities with good public transport, strong regulatory state, strong safety net, no guns, and irreligious. To them, the more rural, religious, and traditional red staters are “deplorables”, people who are just so far behind culturally that it’s an embarrassment to them. They’ve long sneered at those fools in flyover countries.
Of course the people in flyover counties are not onboard with the upper classes and their attempts to remake American culture into something different. They like their do-it-yourself culture, they like Christianity, they like speaking their minds, and they like guns. They obviously aren’t too keen on being sneered at by people who consider themselves better than a deplorable.
Do you think that the upper class in America really wants a strong safety net? If they do, why do they not put more support behind people like Sanders and Warren rather than people like Clinton and Biden?
The upper class supports a strong safety net for the children of the upper class. Specifically, they think that the low paying jobs that rich kids take for status reasons should come with an income that allows that person to stay in the class of their birth. The daughter of a surgeon or a banker who becomes an adjunct or a journalist should be guaranteed an income to allow her to live in the manner to which she has become accustomed. A Clinton or a Biden ensures this.
A Sanders could take wealth from backwards patriarchal dad who still pays the bills.
Does a Clinton or Biden really ensure it? As far as I know, wannabe journalists do not have it easy during Democratic administrations. And why would a rich person not just give their kids money directly rather than indirectly through trying to manipulate the levers of government? It takes more out of their pockets but on the other hand, is more sure of success. Some parents have the attitude of "make the kid learn by working for their own money", but making it so that the government supports them would be almost as bad for such a policy as giving them money directly would be.
Biden has certainly pulled every lever he could reach to send as much money as he can to universities. His initial student loan bailout had a cost of hundreds of billions before SCOTUS spiked it...
And here's the bailout for news organizations, framed as allowing them to collectively bargain to collude against tech companies.
So that's university jobs and news media jobs...
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