NDN Blog

Trump’s Tariffs Are A Growing Threat To The American And Global Economies

This is the eighth article in a series produced by NDN challenging Trump’s tariffs.

Today there is a growing body of evidence that one of Trump’s signature policy proposals, the tax cut, hasn’t delivered the economic returns promised by the President. I will argue in this piece that his other major initiative, the protectionist trade policy, has also failed to deliver on his promises. In launching the tariffs, Trump’s promises to Americans were simple: strengthen growth, reduce the trade deficit, and help US manufacturing. By any account, each one of these has failed. Instead, the trade war is now viewed as a growing risk to the global economy, and threatens to weaken the strong economy that Trump inherited in 2017.

Risks to Economic Growth

Since mid-summer, future growth expectations for the US and global economies have rapidly declined.  In Bank of America’s November investor report, 44% of investors expected a decline in global growth in 2019, the highest number surveyed since November 2008 on the eve of the Great Recession. In October, meanwhile, the IMF reduced their forecast of global growth for both 2018 and 2019 from 3.9% to 3.7%, representing a global income loss of almost $530 billion. This weakening of the global economy is likely to put significant downward pressure on US growth as well. Goldman Sachs now forecasts that US growth will fall from 3% this year to 2% in 2019, and will hit only 1.6% in the fourth quarter of 2019. Similarly, JP Morgan estimates that growth will decline from 3.1% this year to 1.9% in 2019, and will hit just 1.5% in Q4 2019.

Trump’s trade policies, which have placed tariffs on $250 billion of Chinese imports and $50 billion of steel and aluminum imports primarily from Canada and the EU, have played an important role in this slowdown. First, higher tariffs mean that domestic companies have to pay more for intermediate inputs, putting downward pressure on jobs, income, and capital investment as firms have to account for higher costs. Second, with less access to cheap foreign goods, the purchasing power of domestic consumers falls, meaning that workers can buy fewer products for every dollar they earn. Finally, tariffs create inflationary pressures by taxing low cost goods, which forces the Fed and other central banks to hike interest rates faster, thereby tightening financial conditions in the global economy. It is no surprise, then, that in Bank of America’s November investor report that found 44% of investors expecting a decline in global growth in 2019, investors cited Trump’s trade war as the biggest risk to the global economy (35% of investors), ahead of the Fed’s rate hikes (26% of investors), and rising corporate debt (14%). Business investment, a key component of growth and something heavily affected by firms’ input prices and consumer demand, has likewise slowed significantly in the face of Trump’s trade policies. Non-residential private investment rose only 2.5% in Q3 2018, compared to an average of 10.1% in the first half of 2018 and 6.3% in 2017. Furthermore, new durable goods orders have fallen for two straight months and are down 1.2% since June, significantly lower than the 2.3% growth seen in January to June 2018.

Worsening of the Trade Deficit

The six months since June have also seen a large widening of the trade deficit, and the US today is running its largest trade deficits since 2008. Since the tariffs were enacted, the trade deficit has increased by 18.1%, compared to economic growth in that period of 1.8%. Since June, the trade deficit has averaged $50.8 billion per month, which is 5% higher than its Jan-May 2018 average, 10.4% higher than its 2017 average, and 21.4% higher than its 2016 average under Obama. Given that one of the biggest impetuses behind Trump’s tariffs was to reduce the trade deficit, the policy as a whole seems to have faltered.

Driving the increase in the trade deficit, firstly, has been a decline in US exports. Exports have fallen at a 0.6% annualized rate since June, compared to an increase of 8% (annualized) in Jan-June 2018, 7.8% in 2017, and 4.1% in 2016. Secondly, US imports have skyrocketed since the tariffs were enacted, even though one of their major purposes was to encourage the substitution of imports with domestic production. Imports have risen at a 12% annualized rate since June, compared to 0.2% (annualized) in Jan-June 2018, 9.7% in 2017, and 4.5% in 2016. These trends are unsurprising given the effects of Trump’s tariffs. Almost $150 billion of US exports have had retaliatory tariffs enacted against them by our trading partners, and crucial intermediate inputs like steel and aluminum have seen their prices rise by over 20%, making American products uncompetitive abroad and at home.

Harms to US Manufacturing

Outside of the major macro-economic goals of improving growth and reducing the trade deficit, the tariffs were also primarily crafted to help US manufacturing. Instead, however, American manufacturing companies have been strongly hurt by the tariffs, and the auto industry in particular has seen its global competitiveness weakened. Since June, the S&P 500 Industrials index (which covers industrial companies within the S&P 500) has fallen by 5.1%. By contrast, it rose at an annualized rate of 11.8% from January 2017 to June 2018 and by an annual average of 14.2% during Obama’s 2nd term.  

GM, meanwhile, has seen a 15.2% decline in its stock price since June and earlier this week announced the layoff of 14,000 workers in North America and the closure of five plants. This is on the back of the company losing $1 billion in earnings in 2018 alone as a result of Trump’s steel and aluminum tariffs, and a 15% decline in GM’s sales in China in October as a result of worsening trade tensions. Similarly, Ford’s stock price has fallen 20.1% since June and the company last month announced likely layoffs of 12% of its global workforce (24,000 workers). Ford too reported that Trump’s tariffs would cost the company over $1 billion in earnings this year. Tesla also reported a drop in its China sales of over 70% in October, after warning last month that the trade war would harm its business. Finally, new reports suggest that the 25% tariff on foreign-made autos that Trump is considering would destroy a further 715,000 jobs in the auto industry and reduce annual GDP by $59 billion. Rather than revitalize US manufacturing, Trump’s tariffs instead have reduced its global competitiveness. With rising input costs and constrained export access, US companies particularly in the auto industry have been forced to lay off workers and close plants.

Large Losses in American Agriculture

The second biggest supposed benefactor from Trump’s tariffs were American farmers, who Trump claimed were taken advantage of by Canada and European protectionism. More so than any other industry, Trump’s trade policy has significantly harmed American agriculture. From June to September 2018 (the most recent data), US agricultural exports fell 1.8% YoY and the US trade surplus in agricultural products fell by 26%. As a result, the recent increase in farm bankruptcies throughout the country that began in 2017 has continued unabated, reaching levels over twice as high as those in 2013 and 2014. Soybean farmers in particular have been devastated by Trump’s trade war with China, and have seen a 97% decline in exports over the past three months.

Furthermore, while $12 billion in government bailouts has kept some farmers afloat, the damage done to agriculture (and to the rest of the US economy) will continue long after the tariffs are rescinded. New supply chains that exclude American workers, instead going to Canadian and Brazilian exporters, have been developed in place of American ones that took decades to develop. Further, the level of uncertainty over basic trade policy created by the Trump administration makes it less likely that American or foreign firms will invest in long term projects in the US.

Today there is an overwhelming body of evidence that Trump’s tariffs are unpopular and causing material harm to the US and global economy. The question now is, what do we do about it? In a recent Wall Street Journal interview, Trump showed that he doesn’t understand what he’s doing and that no rigorous analysis backs up his views on trade. As a result, it is unlikely that he can offer ideas to address the growing risks of the trade war with China and the conflict with our closest allies over auto tariffs. It will be up to members of both parties in the next Congress to challenge Trump far more directly on his reckless trade policies, and remove the threat to the US and global economies. 

The Case for Optimism: Rejecting Trump’s Poisonous Pessimism

This piece was originally published on Medium on June 2nd, 2017. 

So, imagine if you lived in America at a time when:

· Incomes of everyday people are at an all-time high, have been rising for at least four years now and saw their largest annual increase in recorded US history just a year ago.

· The unemployment rate is 4.3%, about at what economists consider “full employment.” This rate is historically low — over the past 70 years (821 months), the rate has only been lower in 130 of those months or just 16% of this 70 year stretch. A reminder that the unemployment rate never dipped below 5.3% during the entire Reagan Presidency.

· More people have health insurance and access to quality than any time in American history. A recently implemented health care law has materially improved the lives of tens of millions Americans in a very short period of time.

· The US stock market is at an all-time high, and 33% percent higher than any sustained high in US history and between 5 and 10 times higher than where it has been most of last 50 years. So really high.

· The high school graduation rate is the highest ever recorded.

· Violent crime rates are half of what they were a generation ago, and cities across the US are blossoming, seeing growth, investment and people once again living “downtown.”

· Teenage pregnancy rates are plummeting, and now are at all-time low.

· There has not been a foreign fighter terror attack on US soil in 16 years, few American troops are dying overseas and the US faces no true existential threat from a foreign power.

· Due to smart policies and years of investment, the flow of undocumented immigrants into the US has dramatically slowed, seeing no net increase for a decade now.

· The US is taking control of its energy future, seeing a sharp decrease in foreign oil imports and sharp, even historic, increases in the production of renewable energy.

Would that America sound like a good America to you? I think so. And of course this list describes the America of today, early June, 2017. America is not without its problems, of course. Despite our economic success, we are still leaving too many behind. Growing levels of inequality are corrosive to the social fabric and bad for the economy too. We have too much public and private debt. Tribalism, racial strife and social coherence remain daunting challenges. Mass incarceration too. The opioid epidemic is tragic, and needs far more attention and action. Too few people vote in America, and our civic life needs renewal on many fronts…..

For a 70 year old alive today, the unemployment rate has been higher than 4.3% for 59 of her 70 years. Line is current level of unemployment.

But it is the premise of this essay that while America has very real challenges, somehow the positive side of the nation’s balance sheet — and there is a lot there — has been recklessly ignored in our national discourse. It is my contention that contrary to the claims of our President, America hasn’t lost its greatness, and that by many historical measures there has never been a better time in all of America history to be alive. Certainly better than the Great Depression, or when we held millions of slaves in cruel bondage, or when kids worked and didn’t go to school, or before there was a minimum wage or a social safety net, or when little black kids and little white kids couldn’t drink from the same water fountain, or when hundreds of thousands were dying in Vietnam, or a Cold War could lead to nuclear annihilation at any moment? Or when sky high interest rates prevented us from buying homes, or women couldn’t vote or work or pursue their dreams, or when OPEC decided to punish America, forcing us to wait in lines for hours just to buy gas? Or especially, my Republican friends, when Ronald Reagan was President and the unemployment rate never dipped below 5.3?

Incomes recovering after years of stagnation, decline. Note difference of GOP (red) and Democratic (blue) Presidencies.

Which brings us to Trump. So much of what he is doing flows from the argument that America isn’t managing this new age of globalization well but being defeated by it. It is the rationale behind stripping health care from tens of millions, dismantling common sense environmental regulations, and getting out of the Paris climate deal and TPP; behind his harsh new immigration enforcement and criminal justice policies; behind his dancing with dictators and distancing himself from democracies. And of course, the data above suggests that this argument — the entire rationale for Trump’s Presidency — just isn’t true. Not even close. Things are far better than he says, or perhaps, understands.

Dow Jones Average 1900–2017. Today, far far above historic norms.

Our new President is the first in our history to be under investigation for treason while in office. Whether he has in fact betrayed our nation to a hostile foreign power (and I think he did) will be determined soon. But to me the greater betrayal of this remarkable nation and its hundreds of millions of decent, hardworking people is the President’s denigration of our collective accomplishments over the past generation. Despite the many headwinds of the modern world America has made true, substantial progress. We are a better and more prosperous nation than we were a generation ago. Our companies lead the world in just about every possible sector, and the innovation and creativity in our private sector remains the envy of the world. Our military has no near peer, and remains the greatest fighting force ever assembled. We are taking control of our energy future, and making great strides against climate change. We are working through our unique challenges with race and tribalism, and while Trump is an obvious setback we just saw a man of color lead our nation successfully for the first time in history. Millions of new Americans are starting businesses, building families and making their mark. Our universities are the best in the world, and our public schools are getting better. I could go on and on and on.

But the bottom line is by selling us short Trump betrays both the greatness of our country and the goodness of the American people every day of his Presidency.

And this is the key. To defeat Trumpism we must be optimists, patriots, pragmatists now. To defeat the man, we must defeat his fallacious arguments about America and what we have become. While he talks down America, we must talk it up. We should be proud stewards of a great nation, but steely-eyed and resolute about tackling the real challenges that remain. In many ways, even in these nasty early days of Trump, I have never been more proud of my country, more in touch with what it means to be an American. For it remains the greatest country on Earth, the inspiration for so many — and it will reclaim that role in the days after Trump if we can together not just defeat the man, but defeat the dark pessimism his brand of politics has unleashed into America and the rest of the world.

Can we do it? In the words of another who came before, there is no doubt in my mind that “Yes, we can.”

2018 Was A Very Good Election For Democrats, And An Even Better One For Their Future

This piece is part of a series by NDN analyzing the 2018 election.

Much has been made about whether to call the 2018 midterms a “wave” election for Democrats. During election night, pundits were quick to capitalize on some early evening setbacks for Democrats to argue that the Party had underperformed their polls. However, with a dominating performance in California and strong results in Arizona coming in over the past week, it is clear that 2018 was indeed an historic wave election for Democrats.

National Popular Vote

The House popular vote is the best way to conceptualize the election results as a whole. It includes every voter in the country, isn’t affected by district gerrymandering, and ignores the partisan lean of the Senate seats up in a given year’s cycle. As of November 17th, Democrats had a 7.7% lead in the popular vote ahead of Republicans, and this is likely to end up close to 8% once all of California’s ballots are counted. How does this compare to previous elections? Firstly, it will likely be the largest popular vote win by any party in a national election since 1996 (when Democrats won by 8.5%) – larger than Republican’s 6.8% margin in 2010, Obama’s 7.2% margin in the 2008 presidential election, and likely Democrat's 8% margin in 2006. Second, compared to the three definitive midterm “wave” elections of the modern era (1994’s 7.1% margin for Republicans, 2006’s 8% margin for Democrats, and 2010’s 6.8% margin for Republicans), it is right at the top. Third, while Democrats have passed the 7.7% margin twice in the modern era, this margin is larger than any Republican electoral margin since 1988 (when Bush won the presidency by a 7.8% margin) and any Republican House margin since 1946 (when Republicans won by 8.5%). Fourth, the Democrats have won 53% of the vote in 2018 so far and are on track to hit near 53.2% once all of California comes in, which beats Obama’s 52.9% in 2008 for the largest percentage won by Democrats since 1986. Finally, the 37-40 seat pick-up by Democrats (depending on a few seats not yet called) will be the largest gain by Democrats since 1974. Clearly then, this election was one of the best showings by either political party in recent decades.

Young Voters

Even more decisive than its actual results, however, was what this election said about the future of the two-party system. In every demographic group that will increase its share of the electorate in future years, Democrats won unprecedented victories. Firstly, young people. Democrats won the 18-29 age group by 35%, the largest margin by any party for that demographic group ever recorded (data goes back to 1992 for House races and 1976 for Presidential ones). For context as to how dramatic a shift this has been, in 1998 this age group went 50-50 to Democrats and Republicans. For all under 45s, Democrats won by 25%, also the largest margin ever recorded for this group. As late as 2004, Republicans were winning this demographic group by 1% (and by 6% in 2002). The catastrophic Republican performance among young people cannot be overstated. In every single state with an exit poll in 2018, Democrats won the 18-29 group, including deep red seats like Mississippi (D+6 among 18-29 year olds), Tennessee (D+16), and Georgia (D+29). In Texas, a state where Republicans won 18-29 year olds by 5% in 2008, Democrats won that age group by 42%.

Hispanic and Asian Voters

Hispanic voters, who made up 11% of the electorate this year compared to 6% in 1998, showed a very similar trend. Democrats won the Hispanic vote by 40% in 2018, the 2nd highest margin among this demographic group since 2000 after Obama’s 44% margin in 2012. By comparison, Democrats won Hispanics by only 26% in 2014. Among Asian voters, who this year comprised 3% of the electorate versus 1% in 1998, Democrats won by 54%, their highest ever margin among this demographic. Among college-educated voters, meanwhile, Democrats won by a 20% margin, also the highest margin for either party since at least 1992. This compares to a Republican win of college-educated voters by 3% in 2014 and by 8% in 2010.

Democrats won an historic victory in 2018 among all voters, but their dominating victories among all of the emerging demographic groups should cause Republicans significant concern. In the early 2000s, the Republican Party put significant effort into reaching these voters, and they were rewarded in the 2004 presidential election with historic support from under 45s (R+1) and Hispanics (D+9). Under Trump, however, the party has harshly veered from that trajectory and has been decisively repudiated by those groups as a result. The R+1 among under 45s in 2004 has turned into a D+25 in 2018, while the D+9 among Hispanics in 2004 has turned into a D+40 in 2018. Unless Republicans can dramatically change how they are viewed by these groups, their long term path to power seems difficult.

Invite: Wed, Dec 12th - NDN's "Patriotism, Optimism"

Over the past year or so Simon has been making a big argument about the past and future of the center-left in America.  Called "Patriotism and Optimism," it makes the case that America is not in decline and is in fact doing as well as it has in any point in its history. It is meant to be an explicit rebuttal to the core argument Trump is making about America and its decline, an argument which is malevolently selling America and its people short every day. 

This primary way this argument has made itself into the world is through a 45 minute long Powerpoint deck, which has been seen in dozens of showings over the web and live in person to policy makers here in Washington and around the country. Our next showing of the deck will be Wednesday, December 12th from 12:00pm to 1:15pm at our new offices at 800 Maine Avenue SW, Washington, DC. Lunch will be served. You can RSVP for the event and learn more here. For background before the showing, feel free to check out some related readings below.

Key Background Readings On "Patriotism and Optimism"

The Case for Optimism: Rejecting Trump's Poisonous Pessimism, Simon Rosenberg, Medium, 6/2/17. In an essay that originally was published on Medium, Simon argues that the great rationale of Trump's Presidency  –  that America is in decline – simply isn't true, and must be challenged more forcefully.  This is the piece that spurred the creation of the presentation. 

Chin Up, Democrats, Simon Rosenberg, US News and World Report, 1/20/17. In his column Simon argues that Democrats should have pride in their historic accomplishments and optimism about the future of their politics. This one is very relevant to the presentation itself. 

A Center-Left Agenda for the Trump Era - Simon Rosenberg, US News and World Report, 12/9/16.  In the early days after Trump's election Simon layed out a possible agenda for the Democrats centering on prosperity, security, shoring up the American led liberal order and ambitiious efforts to reform our political system. 

Additional Readings

Some Thoughts On the Caravan - By Simon Rosenberg, Medium, 10/24/18.  The Caravan, composed of 7,000 poor, unarmed, mostly Honduran Central Americans, poses no threat to the US, and illegal border crossings continue to be way down. Some thoughts on what Democrats should do to respond to Trump's farcical attacks and terrible policies.

Are We Better Off Under Trump? The Short Answer Is No - By Simon Rosenberg and Chris Taylor, NDN, 10/18/18.  Most measures of the US economy are worse today than when Trump took office. Worse still, the President’s policies have made it very challenging to manage the next recession or global economic downturn.

Challenging Trump's Tariffs - An Ongoing Series - By Chris Taylor, 10/17/18.  In a new series challenging Trump's tariffs, we argue that the President's trade policy is illegal, recklessly ignorant, damaging to the US economy, and historically unpopular. Congress must step up and rescind them in the coming months. 

Trump's Immigration Strategy Is Failing - By Simon Rosenberg, NBC News, 8/6/18.  Almost nothing the President has done on immigration and the border has worked; expect more extreme policies as the elections approach. 

Congress Must Debate The Weakening of Global Order - By Simon Rosenberg, NBC News, 5/10/18.  Few presidents have inherited a world or a nation in which more was going right. Trump seems determined to undo it all.

The Pernicious Politics of Oil - Simon Rosenberg, US News and World Report, 12/16/16.  Petro-powers are challenging the global order, and the next president seems uninterested in stopping them.

An Enduring Legacy: The Democratic Party and Free and Open Trade - Simon Rosenberg, Huffington Post, 1/24/14.  The global system created by Presidents FDR and Truman has done more to create opportunity, reduce poverty and advance democracy than perhaps any other policies in history. 

Who Won The Hill Election Prediction Contest?

Friends, a few of you have asked who won The Hill election prediction contest.  In reviewing the various submissions, with the late movement towards the Dems in Arizona and other places, it appears I won, or Maria Cardona did, or both of us. 

Of the three who could win Armstrong Williams had it Senate GOP plus 5, and Dems winning 30 in the House.  Maria and I had Rs keeping the Senate/Dems plus 1, and I had the House at 40 and she had it at 35-40. 

Where we stand today is Rs plus nothing (they are still at 51), which is far closer to where Maria and I have it than Armstrong (he is off 5, we are off 1).  If Rs win both FL and MS in the coming weeks and get it up to plus 2 then Armstrong, Maria and I will be off by 3 seats each, tying.  But Maria and I are closer in the House as it looks like Dems will come in 38-40. 

Still waiting for the Hill to make their call but sure does look like it will be some combo of me and Maria, and Maria as many of you know is a former NDNer.  Will update when we know more.  

In All Important Florida, Democrats Lose Ground With Hispanic Voters

In an election where Democrats had one of their best years ever with Hispanic voters across the country, Florida Democrats saw their Hispanic numbers decline.  Nationally, Democrats went from 62-36 (26 pts) in 2014 to 69-29 (40 pts) this election. In Florida, Democrats went from 58-38 (20 pts) in 2014 to 54-44 (10 pts) this year.  If both Gillum and Nelson end up losing, this significant underperformance with Hispanic voters will have played a major role. 

The growth of the Hispanic share of the electorate from 2014 to 2018 from 13% to 15% can be attributed entirely to registration growth, not better turnout operations.  And we know from registration data that very few of these new potential voters registered as Republicans.  So this growth we saw should have made the Hispanic electorate more Democratic, not less. 

Finally, think about what Trump has done in the last 2 years.  He has relentlessly attacked immigrants and Hispanics in particular.  He grossly mismanaged the aftermath of Hurricane Maria, sending hundreds of thousands of Puerto Ricans fleeing to central Florida.  He revoked the temporary status of many immigrants in Florida.  Given all this one would have imagined the environment for Democrats to make gains among Hispanics was present in Florida this year, gains which were made elsewhere.  Yet we fell back.

I don't know what happened but there needs to be a big conversation about the Democratic Hispanic campaign in Florida with this year.  Figuring out what went wrong and correcting it may hold the key to the Presidency in 2020.

PS - am very aware that Florida Hispanic electorate very different from rest of US.  I oversaw a $3m ad campaign in Spanish in Florida in 2004 which ran three different sets of ads - one to Pueto Ricans in central Florida, one to Cubans in South Florida, and one to Colombians also in South Florida.  Well aware of the differences, and is clear now Mexican American voters rejected the GOP in record numbers this election but something  very different happened in Florida.  Need to understand why.  

NDN's 2018 Election Analysis

NDN has produced a new series that takes an in-depth look at the 2018 election results and provides analysis as to what the election means for policymaking over the next two years, the changing demographics of voters, and the 2020 presidential election.

A Good Night For Democrats - 2018 Post-Election Analysis - 11/8/18 - 2018 was a very good election for the Democratic Party.  Next year Democrats will have far more power, Republicans far less.  Important new leaders emerged, GOP saw its position erode in key 2020 battlegrounds, and young voters and Hispanics swung hard for Democrats.

Among "New Coalition" Voters, Democrats Have Their Best Performance Ever - 11/9/18 - In the 2018 elections Democrats had their best showing ever with 18-29s, 18-44s, and Asian-Americans, and their 2nd best with Hispanics.  Bodes well for 2020 and many elections to come.

2018 Was A Very Good Election For Democrats, And An Even Better One For Their Future - 11/16/18 -  In 2018, Democrats had their largest popular vote margin over Republicans since 2006, and their highest percentage support since 1986. Alongside historic gains among all of the growing demographic groups, this election shows the strength of the emerging Democratic coalition.

$38 Million For Beto, And Why It Matters - 10/30/18 - Democrats have been raising a lot of money this cycle.  This is not just about fear of Trump - it is about the broad adoption of a more authentic people based politics suited for the digital age championed by Dean, Obama, and yes even Trump himself. 

A New And Exciting Democratic Party Is Emerging - 11/8/18 - Some thoughts on the rise of a new generation of political leaders and how they are going to change the Democratic Party. 

Some Thoughts About The Caravan - 10/24/18 - The Caravan, composed of 3,000 poor, unarmed, mostly Honduran migrants, poses no threat to the US, and illegal border crossings continue to be way down. Some thoughts on what Democrats should do to respond to Trump's farcical attacks and inane policies.

Iowa, Trump, and the Politics of Globalization/Tariffs - 10/12/18 - Trump’s trade policies are hurting the Iowa economy. His tariffs are unpopular there, and his party is performing badly in the fall elections. Some thoughts on what this means for the Democratic presidential race starting soon. 

In All Important Florida, Democrats Lost Ground With Hispanic Voters - 11/9/18 - In a year when Democrats made gains with Hispanics across the nation, Florida Democrats saw their performance with Hispanics decline.  Work has to be done to figure out why. 

Some Notes On The Decline Of TV, Rise Of Social Media In American Politics - 4/27/18 - Some recent data from Pew Research suggests pace of erosion of TV, rise of digital is picking up, and 2018 likely to be first election more folks get their news online than from TV. Big implications for US politics.

Among "New Coalition" Voters, Democrats Have Best Performance Ever

According to the exit polls the 2018 election saw the Democrats returning to an historically strong position with critical emerging parts of the American electorate — young voters, Hispanics and Asian-Americans. Let’s drill down a bit:

Hispanics — Democrats won the Hispanic vote 69–29, a 40 point spread. This is the best party wide showing since Obama’s 71–27 2012 total, and its second best since Hispanics start becoming a significant share of the electorate. Hispanics also voted in high numbers in a high turnout year, clocking in at 11% of the electorate, equal to 2016 and far exceeding the 8% share we saw in the last three midterms, 2014, 2010 and 2006.

 

 

Young People — 18–29 year olds voted Democratic by 35 points, 67–32, the best showing ever for Dems with this demographic. 18–29 year olds made up 13% of the electorate, the same share as the last two midterms, no small thing in a high turnout election. CIRCLE at Tufts University estimates their turnout rate was 31%, up from 21% in 2014, and the highest in over 2 decades.

 

 

Under 45s — Voters under 45 preferred Democrats by a whopping 25 points, 61–35. This is the biggest spread ever with this demo, 2nd most was Obama’s 16 point spread in 2008. In 2016 the spread was 14, and in 2014 5. So this is a huge and consequential shift. The “age gap” is now bigger than its more famous cousin, the “gender gap,” and is perhaps the most overlooked demographic in American politics today.

 

 

Asian Americans — Asians voted for the Democrats by an astonishing 54 points, 77-23, by far the biggest spread with this demo. In 2016 it was 36 points and in 2014 Republicans won Asian voters by a point. So a remarkable performance.

 

 

Taken together, Democrats performed better with these emerging, growing demographics in 2018 than they have in any other election. Was it Trump? Well run campaigns speaking to everyone not just prime voters? Will leave that discussion for another day. For now I sit amazed at this performance, and what it portends for 2020.

A New and Exciting Democratic Party Is Emerging

I published this a few days before the election and will be returning to it again soon.

Many new Democratic stars have emerged since Trump was elected - Kamala Harris, Andrew Gillum, Beto O'Rourke, Mikie Sherill, Abigail Spanberger, Stacy Abrams....the list goes on and on.  To me what we are seeing emerge is a whole set of leaders who will guide and direct the next Democratic Party, a post Clinton/Obama, a post Trump party.  This is my 14th election day as a Democratic operative and strategist, and I will say I have never seen such a talented and capable crop of candidates running and winning across the country.  The future of the Party feels like it is in very good hands.   

For those of us in DC I think this incoming House freshman class has the opportunity to be an historic class.  The DCCC recruited an extraordinarily accomplished and compelling group this cycle, and it is the deepest and most talented class I've seen since I came to Washington (the 1996 class was pretty great). I discuss the potential of this class in a smart new piece by Ron Brownstein and counsel everyone to be very slow at assigning ideological labels other than pragmatist to many of these new arrivals. 

Having said all that, I think there are three groups arriving in January with the power to shape and influence the direction of the caucus for years to come:

Women - Women brought energy and passion to our politics this cycle, huge number of votes and an historic number of women ran and won/will win their elections.  We will have better numbers in the next few days but expect this new dynamic to be central to everything that happens in the Democratic Party in the House and more broadly across the Party in the coming years.

Patriots/National Security Democrats - Next will be a very large group of veterans and former national security officials. Joining current Members like Seth Moulton, Stephanie Murphy, Conor Lamb and Ruben Gallego, this group could become a deeply consequential one, forging American foreign and security policy for decades to come.  To me this group feels like a the type  of Democrat we haven't seen in a long time - a pre Vietnam War Democrat, a WW II and Cold War Democrats, pragmatic patriots, similar to the class full of veterans which came in 1946 after the war to serve their country again but in another way. 

The reason this new type of Democrat will be with us for some time is just the sheer number of Americans who have served in the war on terror and other military conflicts over the past 17 years.  Many of these young soldiers and security officials have now reached the age and a stage in their life where running for office became an option for them.  This is why I think this a permanent trend at least for the next 10-15 years, and one of those trends which makes the emerging Democratic Party very different from the Party of Clinton and Obama.

NDN has been writing and speaking for some time now about the Democratic Party's very real opportunity to reclaim "patriotism" from the right.  Let us hope this will be the case in the years to come.

The Democratic Socialists - While there is no doubt this new sensibility has resonance in the center-left family, it remains to be seen how powerful it will be next year.  This movement has a compelling, emerging champion in future Rep. Ocasio-Cortez, but there just aren't that many candidates running this cycle with this label as their primary affiliation.  The first two groups we discussed - women and the national secrurity Dems - will likely be much larger in number in the Senate and House next year.  Regardless of numbers, expect this new post-Bernie tribe to be loud and influential. 

While some of these new Members will get absorbed into existing groups like the New Dems, Blue Dogs, Future Forum, Hispanic/Black/AAPI Caucuses, my sense is that this class is going to be so large and its sensibilities new enough that it will itself become a force perhaps equal to any of these existing factions.  Will be fascinating to watch.  And watch this new video which brings together, powerfully, two of these trends - women and national security experience.  Hard to watch this and not sense the emergence of a new post-Clinton, post-Obama Democratic Party.

A Good Night for Democrats - 2018 Post-Election Analysis

This analysis was originally posted on Wed, Nov 7th at 1150am and was last updated on Nov 20th, 8am.  You can find all of NDN's pre and post election analysis here

A Good Night For Democrats – The Democrats now appear to have won between 36 and 39 House seats, the biggest election year gain for House Democrats since 1974, 44 years ago. Democrats also won 7 governorships, close to 400 state legislative seats (5.4% of total), flipped 8 state legislative chambers and ended GOP super majorities in MI, NC and PA.  No question the losses in the US Senate hurt, but national Republicans have to come to terms with what was an extraordinary repudiation of their politics in the 2018 election. The NYT currently estimates that Democrats won the popular vote by 7% and exit polls show a victory of 8%. Both results would put 2018 at the upper end of recent midterms considered waves - 1994: R+7.1% 2006: D+8.0% 2010: R+7.2% 2014: R+5.7%.  It was a very good election for Democrats indeed; and count me in as one those who argued at the time, and believe today, that the President's decision to close with the inflammatory and absurd caravan - particularly after the two domestic terror incidents - rather than a more surburban oriented close was a huge mistake, one which cost him and his party dearly. 

While the Donald Trump and the Republicans still has a great deal of power, they will have far less of it next year. The allocation of political power in the US will more accurately reflect a nation where Democrats consistently win more votes than the Republicans  (6 of 7 last Presidential votes, all time US record).  The House will be Democratic, a majority of Americans will have Democratic governors, wildly gerrymandered GOP supermajorities will have finally been ended, and Democrats will control more state legislative chambers.  What remains remarkable, and perhaps dangerous, that the GOP will have between 51 and 53 seats in the Senate despite losing the popular vote in Senate races in 2016 54%-42% and 57%-42% in 2018. 

GOP Lost Ground in Critical 2020 Battlegrounds – Democrats had strong nights in both the Midwest/Rustbelt and in the Southwest, the regions of the country which will decide the 2020 Presidential election.  Democrats won the MI, MN (2), PA and WI Senate races and MI, MN and PA governors race by very huge margins.  The region's wunderkind Scott Walker was defeated.   Democrats will pick up at least 9 House seats in this region, and while they came up short in the Iowa Governor’s race they now control 3 of the 4 House seats there. Reviewing it all the total collapse of the GOP in MI and PA should be of particular concern to Trump and the GOP

The Southwest, on the other hand, has never been friendly territory for Trump and it got a lot worse this election. As background, the three states which saw the biggest movement towards the Democrats in 2016 were, in order, CA (7pts), TX (6.8pts) and AZ (5.5pts). Last night we saw Beto get within 2 1/2 points in Texas, help Dems win many down ballot races and hold 6 GOP reps to 51% or less (TX-10, 21, 22, 23, 24 and 31).  Rep. Sinema seems to be in process of winning the AZ Senate race and Dems now hold a 5-4 advantage in the AZ Congressional delegation. Democrats had very good/blowout nights in Colorado, Nevada and New Mexico, so much so that there are questions about whether these will remain in the Presidential battleground in 2020.  Dems are on track to pick up at least 14 House seats in these states including 6 or 7 in California alone, a state where the GOP didn’t even have a Senate candidate on the ballot and where voters with no party preference now outnumber Republicans in registration (and the home of the two most significant GOP Presidents in past 50 years).  We saw intensity too.  AZ, NV and TX saw more people vote early this year than voted in all of 2014, the only 3 states to see that level of increase.

All of this adds up to a night of dangerous erosion for the GOP in this region.  Recall that as recently as 2004 Bush won AZ, CO, NM and NV and Senator Kerry didn't even contest CO that year.  Trump has accelerated the movement of the heavily Mexican-American part of the US from lean R to deep blue and purple now.

Over the last two years there was always this sense that while the President’s thunderous championing of white nationalist, xenophobic and anti-immigrant rhetoric and policies was hurting him in the heavily Mexican-American parts of the US, it was the key to unlock the Rustbelt and Midwest.  Given the really bad night the GOP had in the northern part of the US that no longer appears to be true  Trump may have used the caravan to win in very red and rural places like Indiana, Missouri and Tennessee, but in the states he needs to win in 2020 Democrats will be far more powerful in just about every state.  Looking at both vote share, and the partisan representation in the state, let's see how the terrain looks for Mr. Trump in 2020: 

Much more Democratic - AZ, CO, MI, MN, NM, NV, PA, VA, WI.  Will be interesting to see if Trump even contests CO, NM, NV and VA in 2020.  AZ now clearly a purple state.

More Democratic - GA, IA, NH.  Georgia now likely to be in play in 2020. 

Not much change - FL, NC (Florida is still up in the air).

More Republican - OH. Will be questions about whether OH remains a battleground state.

My broader point is that Trump barely won the election in 2016, and as of today, the map looks even harder for him in 2020 than 2016. 

Young Voters and Hispanics Continue to Show Their Potential For Democrats – Much will be written about the huge and consequential gender gap this year, but I want to drill down a bit on another huge yawning gap – those over and under 45 years old.  The exits found 18-29 year olds going 67%-32% for Democrats last night, under 45s 61%-36% and those over 45 just 49%-50%.  By comparison, 18-44s went 53%-39% for Clinton in 2016, and over 45s went 52-44% for Trump.  But remarkably the share of the electorate for those under 45 dropped from 44% in 2016 to just 35% in 2018.  Imagine the outcome last night if Democrats were able keep the under 45 participation rate in the 40s – would have been an even bigger blow out.  Given the margins we see here, national Democrats must literally become obsessed now with speaking to and maximizing the turnout of voters under 45.  It is simply one of the highest strategic priorities we have.  And to do so we will have to continue to embrace a post-television politics, as this age cohort essentially no longer watches conventional television.  I wrote about the disappearance of television earlier this year, and also why Beto’s campaign helped show us the future with his remarkable people-centered, social media heavy campaign. 

Latino voters went 69%-29% for Democrats in 2018, slightly up from 2016’s 66%-28%.  This 40 point net showing was among the best in recent elections, and reminds us that in the age of Trump investments in speaking to and turning out Latinos will pay enormous dividends. Or as Democrats in Florida may have just been reminded, failure to do so can cost you close elections. 

We just put together a new memo summing up this and other data.  The bottom line - Democrats had their best showing ever with Asian-Americans, 18-29s, 18-44s and their second best showing with Hispanics.  The Democratic Party's "new coalition" is clearly alive and well, and delivering powerfully six years since the last time Barack Obama was on the ballot. 

More - I published a related piece, "The midterms show Trump might not get re-elected in 2020," on Thursday, November 8th on the Al Jazeera website.  You can also find my thinking about the 2018 election in these stories in the AP, The Houston ChronicleUS News, The Washington Post and this new Washington Post frontpager which refers directly to this analysis. 

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