NDN Blog

NDN On The 2020 Elections

With twenty plus announced Democratic candidates in the race the 2020 election is now fully underway. Election analysis has been one of NDN's most influential areas of work over the past 14 years, and we send along some of our most recent releases below, hoping they will inform your own work and thinking in the days ahead.  Our 2018, 2016, and 2014 election analyses are also available for your review. 

Top Lines

Notes on 2020 - Our Regular Look at The Latest Electoral Trends.  Recent essays on 2020, all in one place.

Analysis: Trump Is The Least Popular First-Term President Since WW2 - Chris Taylor, NDN, 9/11/19 - Trump is the most unpopular first-term president in over six decades and is leading Republicans down the path of the California GOP by ignoring those demographic groups that will over the next decade become more and more critical to winning elections.

Trump 1.0 Has Failed. What Comes Next? -  Evidence of the failure of Trumpism is all around us.  His poll numbers are the worst of any 1st term President, his policies have left the nation weaker, more isolated.  As he begins his re-election campaign, Trump is looking increasingly desperate, and we fear, dangerous. 

Tariffs, Trump, And Tyrants - Simon Rosenberg - More Mad King than President, Trump's refusal to honor the laws, rules, and norms which make democracies work is the greatest High Crime of all. His ill-considered, whimsical tariffs are just the latest example, and should be forcefully challenged by Congress.

Demographic/Geographic Analysis

Americans Under 45 Are Breaking Hard Toward The Democrats - And For Good Reason - Simon Rosenberg and Chris Taylor - Among the most significant political developments of the Trump era is the dramatic shift of under 45 year old voters towards the Democrats.From 2000 to 2016 D margin w/under 45s was 6 points. In 2018 it was 25. 

Dems Have Already Won Back Voters In The Rust Belt. It's Trump Who Needs To Win Them Back Now - Simon Rosenberg - It is a myth that Trump's anti-immigrant and protectionist policies have made it difficult for Democrats to win in the Rust Belt in 2020.  Trump is trailing badly there now raising questions about Trumpism itself has become a grand failure. 

Notes On The GOP's Erosion In The Southwest - Simon Rosenberg - The dramatic erosion of the GOP brand in the heavily Mexican-American parts of the country over the past two elections is one of the biggest stories in American politics.  Trump's border extremism has cost the GOP dearly, and it hasn't kept the industrial north from slipping away. 

In All Important Florida, Democrats Lost Ground With Hispanic Voters - Simon Rosenberg, NDN, 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. 

$38 Million For Beto, And Why It Matters - Simon Rosenberg, NDN, 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.

More

Europe's Elections: Liberals and Greens Make Gains, Right Loses Ground - Simon Rosenberg, NDN, 5/28/19 - In both Europe and the US, a new politics is emerging in opposition to the extremism of the far right. It emphasizes political pragmatism and the embrace of trade and immigration, while also focusing on the significant threat of climate change.

Democrats Must Demonstrate Greater Leadership In Challenging Trump's Ruinous Trade Policy - Simon Rosenberg, Twitter, 5/8/19 - Democrats should be more aggressive in challenging Trump’s tariffs and trade policies given the failure of those policies to achieve their objectives and growing discontent with them around the country.

Iowa, Trump, and the Politics of Globalization/Tariffs - Chris Taylor, NDN, 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.

Media Citations: You can find NDN in recent stories about the national political landscape in the AP, Hearst Media/San Antonio Express News, NBC News, Washington Monthly and Washington Post (here, here, here).  Our most important recent citations are below. 

Joe Biden Identifies The No. 1 Threat: Trump - Greg Sargent, The Washington Post, 4/25/19 - Key passage: As Democratic strategist Simon Rosenberg, who worked on House races in 2018, told me, Democrats realized that both Democratic and swing voters wanted candidates who offered a "safe port in a storm" at a moment of perceived extreme danger in the form of Trump, which is why Democrats recruited many candidates with records of accomplishment and an aura of solidity and competence. 

The Biggest Field Yet. No Frontrunner. A Divided Base. Welcome To The 2020 Democratic Primary - Molly Ball and Philip Elliott, Time Magazine, Cover Package, 2/21/19 - Key passage: “The Democratic Party is going through a very large transformation,” says party operative Simon Rosenberg, who’s backed the winning candidate in every primary since 1988 but has no favorite this time. “The era of Clinton and Obama is ending and ceding to a new set of dynamics. A new Democratic Party is being forged in front of our eyes.”

This Is Why Republicans And Democrats Aren't Talking To Each Other In Washington - Ron Brownstein, CNN, 1/8/19 - Key passage: "It's fair to say that the House campaign in 2018 executed on a politics that we first saw with Obama in 2007 and 2008: It aligned the House with the way that Obama began to reorient the Democratic Party," said Rosenberg, who consulted with the Democratic Congressional Campaign Committee through the campaign. "There were many people who were saying that Obama's embrace of this new coalition [that was younger, more diverse, better-educated, and more urbanized] was the cause of Democratic decline in the Senate and the House. It was never true. But what was true was that Democrats had never resigned themselves to having to lean into this new coalition that Obama constructed. Now they did in 2018 -- they leaned into it -- and look what happened."

Backgrounder: Protecting American Politics From Foreign Manipulation

If the Mueller Russia Report wasn’t persuasive enough to get Congress to act far more forcefully to protect America’s politics, elections, and discourse from foreign manipulation, consider what we’ve witnessed in just the past few days: Presidential spokesperson Rudy Giuliani claimed that the President did nothing wrong in working with the Russian effort to interfere in 2016 and put him in the White House, a position which of course invites Russia and other nations to return on Trump’s behalf; in public remarks Jared Kushner downplayed the significance of the Russian operation, breaking from Mueller’s account of the gravity of the attack; Twitter took down 5,000 accounts over the weekend pushing pro-Trump memes on the Mueller Report – these accounts were redeployed from their work battling for the Saudi government in the Arabic language; and according to the New York Times, DHS Secretary Nielsen gave up trying to organize a comprehensive governmental response to this emerging threat due to the President’s concern it would bring up uncomfortable issues about how he was elected in 2016.

The President’s repeated denials that Russia intervened on his behalf and that this help was instrumental in him winning him the White House have suppressed the normal societal immune response which would have kicked in to prevent future foreign manipulation.  Smart bills were repeatedly blocked by Senator McConnell.  Critical operational capacities were dismantled. The government has not developed a plan for how to combat foreign manipulation, and no one is in charge of protecting us.  Our 2020 campaigns and elected leaders are basically on their own to navigate potential hacking and mis/disinformation from foreign hostile nation states.  The President, to serve his own interests, has betrayed our national interests in ways which have no parallel in American history.

Simply, Congress and our political leaders must act, and they must act forcefully now.  There is much that can and should be done but in a recent op-ed I laid out what I think the 3 most important things are: 1) Adopt paper ballots and audits, 2) Protect our elected officials, party committees, and candidates, and 3) Forge a pledge among candidates of both parties to forgo the use of illicit campaign tactics in our politics, including the use of fake accounts, troll farms, and the weaponization of stolen materials. 

It is time now for Congress to act. 

Published Work

Re-imagining the Parties In An Age of Hacking, Disinformation - Simon Rosenberg, NDN, 9/7/19 - New digital threats will require US political parties to start seeing themselves as front line actors in our national effort to protect our elections and discourse.  Some thoughts on how the parties can re-imagine themselves to meet these challenges head on. 

GOP Bringing “Moscow Rules” on Disinformation to American Politics - Simon Rosenberg, NDN, 7/26/19 - A series of events over the past several months raises questions about whether using Russian style disinformation tactics has become a core part of the GOP’s electoral strategy in 2020.

Our List of High-Volume, Pro-Trump Twitter Accounts Up to 175 - Simon Rosenberg, NDN, 7/29/19 - Every Monday we will be updating a list of high volume pro-Trump Twitter accounts, ones we call "amplifiers."  The goal - to get a sense of how many of these accounts there are out there. 

ASDC Resolution on Protecting our Elections from Foreign Manipulation - Simon Rosenberg, NDN, 6/19/19 - This is the resolution passed unanimously by the Association of Democratic State Chairs (ASDC) on June 15th in Santa Fe, New Mexico which addresses foreign manipulation of our democracy and elections.  

Biden, Democratic State Parties Embrace Call to Forgo Illicit Campaign Tactics - Simon Rosenberg, NDN, 6/18/19 - Vice President Biden and the Chairs of the State Democratic Parties have now advanced the idea of a pledge to forgo illicit campaign tactics.  Is another encouraging sign that American has begun to take the necessary steps to combat foreign manipulation of our democracy.

Three Things We Need To Do Now To Protect Our Elections In 2020 - Simon Rosenberg, Medium, 4/10/19 - America’s leaders should prioritize three things to protect our elections in the run-up to 2020: require paper ballots and audits, protect candidates from hacking and disinformation, and enter a pact to forgo the use of illicit campaign tactics

Trump Doesn't Take Russian Electoral Interference Seriously. This Is What Democrats Did To Oppose It In 2018 - Simon Rosenberg and Aaron Trujillo, NBC News, 12/18/18 - The U.S. and its politics are not powerless to stop the kind of foreign hacking and disinformation tactics we saw in 2016. In the 2018 midterms, the DCCC developed a series of tools and strategies for reducing the influence and impact of malicious actors. Far more can now be done to protect our democracy and our discourse — and doing so should be a very high priority for the new Congress in 2019.

NDN Hails Progress Made Towards 2020 Pact on Disinfo, Hacking – Simon Rosenberg, NDN, 4/23/19 - This post is a roundup of all the recent developments in the establishment of a new pact or pledge to forgo the use of illicit campaign tactics in the 2020 elections.  It includes links to the pledge which many European political parties and Vice President Biden have signed on to, and recent statements from the DNC, State Parties, and the Gillibrand campaign. 

Protecting the 2020 Dem Primary from Disinformation, Bots and Hacking- Simon Rosenberg, NDN, 1/29/19-  Democrats must come together now to prevent what happened in 2016 from happening again this time.  NDN is calling for all 2020s to sign a pledge forgoing use of illicit campaign tactics in the Democratic Presidential Primary.

The Country Needs to Stop Downplaying The Enormity of the Russian Intervention in 2016 - Simon Rosenberg, Twitter Thead, 1/25/19.  In a widely shared thread Simon goes through what Russia did in 2016 and concludes that the campaign was far bigger and more impactful than conventional wisdom holds, and clearly delivered a very close election to Donald Trump. 

The RNC's Russia Problem - Simon Rosenberg, US News And World Report, 4/14/17 - The Republican National Committee has a particularly important role to play in future efforts to protect America's elections. For as we've learned over the past two years, the RNC was at the center of two of the most important components of the Russian campaign – the penetration of Trump's campaign by the Russian government, and the normalization and use of Russian disinformation.

Media Citations:

Our Next Election Is Dangerously Vulnerable, A Top Democrat Warns. Does Trump Care?- Greg Sargent, The Washington Post, 6/25/19 - In a piece in which Greg Sargent links to NDN work on cybersecurity, he examines the question of whether Trump will warn Putin at the G20 against launching another attack on our political system. 

Simon In Richard Clarke's Future State Podcast On "The Future Of Hacking Democracy" - Simon Rosenberg, NDN, 6/19/19 - Simon talks with Richard Clarke about what Russia did in 2016, new trends and threats we've seen in the past few years, and what steps we should be taking now to prevent foreign governments and domestic actors from manipulating our elections and discourse.

Will It Use Hacked Materials Again? Trump Campaign Will Not Say - Sean Sullivan and Michael Scherer, The Washington Post, 4/26/19 - Key passage: "Refusal to forgo both hacking and the use of hacking materials is a great start, but clear stances on use of fake social media accounts, fake websites and images, high-volume bots, troll farms, and other illicit tactics in common use today by Russia, Saudi Arabia, China and other authoritarian nations will also be necessary," said Simon Rosenberg, who was senior advisor to the House Democratic campaign arm in 2018 and helped run a program to search for online election interference. 

Simon Discusses How To Protect Our Elections On CNN's Situation Room - Simon Rosenberg, CNN, 4/24/19 - Simon appeared on CNN's Situation Room earlier this week to discuss how the Trump administration is actively hindering efforts to protect our elections in 2020, and what our political leaders must do now to prevent what happened in 2016 from happening again next year.

Trump, GOP Won't Act On Election Interference Warnings - A.B. Stoddard, Real Clear Politics, 2/25/19 - Key passage: “Trump’s denial the Russia attack ever took place,” [Simon Rosenberg] told RealClearPolitics, “has suppressed the normal immune response which would have kicked in to protect ourselves from future attacks.  Bills have been blocked, common-sense steps not taken, some important government capacities have even been unraveled. All of it has left us unprepared for what is coming this election cycle, and it is important that both parties in Congress come together in the days ahead around a few simple, achievable things which can make it less likely foreign governments can once again manipulate our elections for their advantage.”

Top Democrats Want 2020 Candidates To Sign Non-Aggression Pact - Natasha Korecki, Politico, 2/26/19 - Key passage: “If we know the campaigns aren’t doing it, it’s going to be much easier to find it and make it go away. If this becomes widespread, it will become truly impossible to root out what’s coming from foreign powers. There’s something bigger than all of us here, and that’s our democracy. Democrats should make a clear stand, understanding that if we don’t set clear norms and rules soon, we could see a proliferation of this illicit tactics that could do permanent and lasting harm to our democracy and other democracies throughout the world.”

Pelosi Just Challenged Trump's Corruption And Lies. Here's What Should Come Next - Greg Sargent, The Washington Post, 2/22/19 - Key passage: Democratic strategist Simon Rosenberg, a leading advocate for this approach, argues to me that the 2020 Democrats should join in a pledge condemning all tactics of disinformation warfare, such as "fake accounts, trolls, hacking, and the use of hacked materials." He adds that this can be part of a broader project of making "the repair of our democracy central to the conversation they are going to have with the American people."

Simon Discusses Protecting The Democratic Primary From Disinfo And Hacking On MSNBC's Joy Reid - Simon Rosenberg, MSNBC, 2/2/19 - Simon appeared on Joy Reid’s MSNBC show last Saturday to discuss his ideas for how Democrats should be working to protect the 2020 Presidential primary from bots, disinformation and hacking.

While Trump Blames The Fed, The Real Cause Of The Growth Slowdown Is His Trade Policy

On Sunday, Trump once again blamed the Fed and Chairman Jerome Powell for the economic slowdown that has intensified since late 2018, and that will likely see 2019 growth close to 2% rather than the 3%+ promised by the President. If Trump actually wanted to find the culprit for this deceleration, however, he would be wise to take a look in the mirror. Indeed, Trump's protectionist trade policy has created enormous business uncertainty around the world and has led to a steep fall in global trade, causing a decline in both US and global growth. Last week, the IMF downgraded 2019 global growth from 3.5% to 3.3%, and similarly reduced their US growth projection for this year from 2.3% to 2.1%. In their analysis, they cited increasing trade tensions as the top risk to global growth and wrote that a failure to resolve Trump's trade war with China and a potential one with the EU would cause a further economic decline.

Furthermore, CNBC's March Fed Survey saw a downgrade in expected 2019 US growth from 2.45% to 2.3% according to 43 market investors, who blamed global trade conflicts and slowing global growth for the slowdown. Finally, the WTO early this month projected that global trade growth would fall from 3% in 2018 to 2.6% in 2019, significantly below its 2000-2018 average of 3.8%. America has witnessed an unprecedented experiment with protectionist trade policy during the Trump administration, and the results of this experiment are now clear - significantly slower US and global growth, and a large hit to the stability of the rules-based global trading system. You can read more about NDN's work challenging Trump's trade policy here, and find our recent piece about the WTO's legal blow against Trump's tariffs here

Weekly Notes On The Economy is a weekly column that NDN writes on the most recent economic news, policy, and data.

Three Things We Need To Do Now To Protect Our Elections In 2020

This essay originally appeared on Medium.

Despite how front and center Russia’s significant campaign to influence the 2016 elections has been in our politics these past few years, little has been done to ensure it doesn’t happen again in 2020. No major bill addressing foreign interference has passed the Congress, the strategy of the United States government remains opaque at best, and of course our President has still not accepted that Russia did intervene last time. This lack of action comes despite the US intelligence community giving repeated warnings about Russia and other nations trying again in the 2020 election; and in recent weeks FBI Director Wray has been loudly raising the alarm about an unprecedented rise in cyber-attacks happening now against American interests. Given how late we are to taking action — the election began three months ago, twenty candidates are actively campaigning for President and voting begins in January — there are three things which the nation’s political leadership should prioritize and make happen in the coming months:

Require Paper Ballots And AuditsFirst and foremost: make sure every state uses unhackable paper ballots and conducts mandatory post-election risk-limited audits of votes (something currently required in Colorado, Rhode Island, and Virginia). Getting this done by the November 2020 elections is going to require swift action, strong leadership from the Administration and Congress, and federal resources. Our current system of leaving election security up to the states, with no minimum mandatory standards, isn’t an adequate response to the reality of the threat today. The simple truth is without paper ballots and audits we have no way of knowing whether our election results have been altered. The lack of leadership from the White House on this fairly straightforward issue has been profound, and dangerous.

Protect Federal Candidates From Cyber Attacks/Hacking And DisinformationWhen it comes to protecting political candidates for federal office from the kind of activity we saw in 2016, the candidates and their political party campaign committees are essentially on their own. The Department of Homeland Security just isn’t yet in this business, and the extraordinary turmoil we are seeing at DHS now will make it far less likely a real program will emerge in the coming months. The cyber protections that federal elected officials receive in their official capacity as Senators and House Members do not extend to their campaigns or private activity, nor does it extend to candidates who are not yet elected. Essentially, it’s up to the candidates and campaigns to protect themselves — even though few politicians are cybersecurity experts — from Russian, Chinese, Iranian and North Korean government hackers and disinformation campaigns.

A series of things must be done here to address these emergent challenges. First Congress should work with DHS to establish a clear and transparent process for information sharing and technical support at the very least with the six federal party committees — the RNC, NRSC, NRCC, DNC, DSCC and DCCC — who can then extend similar services to each of their campaigns. Next each party committee should add a Vice Chair for Cyber Security to oversee these efforts and a Chief Security Officer to ensure the Committee’s access to the technical knowledge required to truly protect our candidates. The strategy for how each Party Committee approaches their responsibilities in these areas should be public, perhaps on their FEC filings; and robust programs with modern tools, fulsome information sharing and extensive training should be funded and executed.

The two offices that provide cyber security for Congress, the Senate Sergeant at Arms and the House Chief Administrative Officer should be given additional authorities and resources, including the ability to help extend protections to the political and private communications of Senators and House Members. Congress should also make counter intelligence and cyber security training mandatory for all principals and staff, and this training should be conducted at least annually as the threats, tactics and tools are always evolving.

Candidates Should Enter Into A Pact To Forgo Use Of Illicit Campaign TacticsOne of the great dangers facing the US in the coming years is that the kind of illicit tactics used by the Russians — hacking, weaponization of stolen information, extensive use of fake accounts and inauthentic amplification — becomes commonly used by domestic actors here in the US against one another. It is vital that responsible leaders of both parties come together and commit to forgoing the use of these kinds of tactics in our democracy.

Many European political parties have signed on to a pledge to forgo these kinds of illicit tactics in their May elections. The Democratic Party State Chairs of the four early primary states — Iowa, New Hampshire, South Carolina and Nevada — have expressed support for the idea of the Democratic Presidential candidates entering into a binding pact with one another committing to forgo the use of a wide range of these tactics. Encouragingly, all of the Democratic candidates up and running in late February agreed to forgo the use of stolen or hacked material in the 2020 elections, a tactic central to how Russia influenced our election last time. It is a good first step but much more must be done.

As an advisor to the Democratic Congressional Campaign Committee in the 2018 elections, I supported both extensive cybersecurity security and countering disinformation operations run by the Committee. We worked with the social media platforms to take down illicit activity, and reported cyber intrusions to the FBI. But at no point did we work cooperatively with anyone else in the federal government. The systems for information sharing, joint learning, training and tool evaluation simply aren’t there yet. We were on our own, as are the campaigns and party committees of both parties this election cycle.

Simply put, we are not ready. The country hasn’t taken the kind of commonsense steps to protect ourselves that we should have taken after Russia’s historic attack on the nation in 2016. The kinds of things I describe above should have happened in 2017 and 2018, and been up and running on January 1st, 2019. They didn’t happen — but they should now. While there are many things which can be done to protect our elections (like the Honest Ads Act and DETER Act, and of course HR1) to me these three steps are the most important and achievable in the coming months. I urge our candidates, elected leaders and the Trump Administration to step up and work together to get them done as soon as possible.

WTO Strikes A Legal Blow Against Trump's Tariffs

On Friday, the WTO issued a series of rulings that struck at the core legal justification for Trump's steel and aluminum tariffs. The administration had argued that countries can impose tariffs based upon their own interpretation of national security interests, and that whether there actually is a legitimate national security concern can't be arbitrated by international trade courts. In a case not directly involving the United States but clearly aimed at Trump's tariff policies, however, the WTO ruled that countries can't simply impose national security-based tariffs for any reason at all, but instead can only impose them when there are unexpected war-related dangers requiring urgent action that involve interactions between sovereign states. This ruling significantly weakens the arguments that Trump had used to justify the tariffs. They have been imposed upon economies including Canada, Mexico, and the European Union, which clearly don't present "unexpected war-related dangers" (and Mattis in 2017 even said the tariffs weren't needed by the US military for any defense-related activities). Furthermore, US steel and aluminum manufacturers have lost business to private foreign companies, and the vast majority of nations affected do not provide state support to their steel and aluminum industries, so Trump's tariffs also don't involve direct interactions between sovereign states.

As NDN has long argued, Trump's tariffs instead represent an extraordinary abuse of Presidential power, and their imposition violates both US and international law. This ruling only reiterates that the tariffs do not serve a legitimate national security interest, and Congress must now act to rescind this latest violation of Presidential authority. You can read more about NDN's work challenging Trump's tariffs here, and find recent Congressional action towards reining in the tariffs here

Weekly Notes On The Economy is a weekly column that NDN writes on the most recent economic news, policy, and data.

NDN Applauds The Progress Made Towards Reining In Trump's Tariff Authority

NDN applauds the progress we've seen this week towards challenging the President's whimsical use of tariffs to achieve his trade objectives. We're pleased that the New Democrat Coalition's Trade Task Force sent a letter on Wednesday urging the President not to impose auto tariffs on our close trading partners, and are also pleased about the more vocal opposition to these tariffs now coming from Republicans as well.

NDN has already endorsed the Bicameral Congressional Trade Authority Act and the Automotive Jobs Act, both of which would put constraints on the President's tariff authority. We continue to believe that the President's frequent and routine invocation of national emergencies as a justification to put tariffs on our closest allies is an extraordinary abuse of President power and should be more forcefully challenged by Congress.

Related Writings: 

Congress Should Warn The President Against Levying Tariffs On Europe - 3/21/19 - The hostility shown by the President and his family towards Europe this week has reinforced the need for Congress to send a clear message to Trump that if he chooses to put tariffs on European goods there will be consequences for his Presidency and his agenda in Congress.

NDN Supports Bicameral Tariff Bill - 2/8/19 - NDN is pleased to endorse and support the Bicameral Congressional Trade Authority Act of 2019, legislation which provides critical Congressional oversight on the President’s ability to use national security as a justification to impose tariffs on our close trading partners.

Trump's Tariffs Are A Growing Threat To The American, And Global, Economies - 11/28/18 - US growth expectations have fallen, manufacturing and agricultural firms now face higher costs and weaker demand, and the trade deficit has surged. With a President unwilling or unable to grasp the risks of a broader trade conflict, it is up to Congress to challenge Trump far more directly on his reckless trade 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. 

Trump Is More Like Maduro Than Any Democrat

This essay originally appeared on Medium.

In recent months, the Republican Party has toyed with a new electoral strategy heading into 2020: accuse Democrats of becoming radical leftists opposed to free markets and democratic institutions, and argue that they want to transform the country into something similar to the Maduro regime in Venezuela. In February, for example, Trump delivered a speech in Miami accusing his political opponents of wanting to impose Venezuelan-style socialism on the United States, while Press Secretary Sarah Sanders in March said that “Democrats are harassing the President to distract from their radical agenda of making America a socialist country.” The strange dynamic of this argument, however, is that the picture it paints of Democrats’ supposed economic unorthodoxy and disdain for the rule of law is far more reminiscent of Trump himself.  More so than any US President in the modern era, Trump has derided the American market-based economic system as robbing Americans and destroying US jobs, all the while trampling on the rule of law and seeking to intimidate his political opponents.

Let’s drill down a bit on the ways Trump is more like Maduro than any Democrat here in the US:

Anti-Market Economic Policies, Picking Winners and Losers - Trump has overseen what has become the most anti-market economic policy of any President in the postwar period. First, his unprecedented attacks on the global trading system have directly weakened the competitiveness of innovative American firms in an attempt to prop up his favored industries. The steel and aluminum tariffs have increased costs to automakers like Ford and GM by over $1 billion, and have led to aggregate job losses of over 400,000 net jobs. And have the tariffs led to the end of unfair trading practices against American steel and aluminum manufacturers? No, because the vast majority of those US imports come from Canada, the EU, and Mexico, all of whom haven’t engaged in dumping or subsidies to their domestic steel and aluminum producers. Trump’s tariff strategy is no different from if he enforced punitive taxes on American automakers and then gave government handouts to the steel and aluminum industries. Indeed, as a result of his tariffs, much of the agricultural industry is now reliant on government subsidies to stay afloat as their export markets have dried up.

Second, in his Miami speech Trump derided the Venezuelan government for its “power to decide who wins and who loses.” And yet Trump consistently interferes in the market and attempts to leverage government power to intimidate firms that he doesn’t like and help companies that he does like. Trump attacked GM’s decision to scale back US production as a result of elevated raw resource costs, and threatened to cut off GM’s access to completely unrelated electric car tax credits that are available to all US automakers. He threatened to unilaterally increase the shipping rates that the US Postal Service charges to Amazon, in an attempt to harm Amazon and Washington Post owner Jeff Bezos. Furthermore, Trump attempted to force electrical grids across the country to buy coal- and nuclear-generated electricity, even if the grids didn’t want to use those sources because they were more expensive. And just last month, he tried to pressure the Tennessee Valley Authority into buying more expensively priced coal-generated electricity from several firms that were owned by friends of the President. Time and again, Trump has refused to allow competitive markets to function, and instead has turned to the socialist strategy of using state power to advantage his allies and harm his enemies.

Third, Trump has overseen the most fiscally irresponsible budget in the modern era, at a time when the strong US economy requires the least fiscal stimulus. Orthodox economics says that debt-financed stimulus should be done during economic downturns and then deficits reduced during subsequent economic booms, so as to maximize the efficiency of borrowed money and reduce the debt burden on future generations. Trump has done the opposite of this. With unemployment under 5%, his tax cut and increased spending have sent deficits surging from 3.1% of GDP in 2016 to a projected 4.2% this year, negating much of the progress that Obama made in reducing it from 9.8% in 2009 to 3.1% in 2016. This level of budget deficit during good economic times is unprecedented in the United States. Indeed, since the end of the Second World War, the three largest budget deficits as a % of GDP while unemployment has been under 6% have been Trump’s deficits in 2017, 2018, and 2019 (projected). Similarly, disregarding fiscal sustainability has been a hallmark of the Maduro regime, which ran budget deficits of 20% of GDP and 15% of GDP in 2015 and 2014 that have played a major role in the country’s current hyperinflation.

Repudiation of Democratic Institutions – The area in which Trump might resemble Maduro the most is in his contempt for the rule of law and democratic checks and balances.  Maduro and his predecessor Hugo Chavez gained absolute power in Venezuela through state take-over of the free press, packing the independent judiciary with their own loyalists, transferring the power of the elected legislature to the executive, and imprisoning their political opponents. If those authoritarian actions sound familiar, it is because they are similar to the steps Trump has tried to take to consolidate his own power (albeit in a system with far greater checks to such abuses). Trump has attempted to delegitimize the free press as the “enemy of the people” in the eyes of Americans, applauded criminal assaults against journalists, threatened to disband specific courts that have made rulings he opposes, threatens almost weekly to lock up his political opponents, and used a blatantly made up national security emergency to bypass the elected Congress to build his border wall. In each of these ways, the actions of the Maduro regime to consolidate power are echoed by Trump in his attempted actions and rhetoric, while it is the Democratic Party that has taken the mantle of defending democratic institutions in the United States.

Furthermore, the President has attacked the independent governmental institutions that help manage the economy when they take actions that Trump doesn’t like. When the Federal Reserve was raising interest rates in a way that Trump thought would hurt his approval rating, he launched the most vocal attacks on the Fed of any President in decades. Meanwhile, Trump’s newest appointee to the Fed, Stephen Moore, is likely the most blatantly political figure appointed to the central bank in recent memory. In December 2018, Moore wrote an op-ed titled simply “Fire the Fed”, and he has consistently called for Fed Chair Jerome Powell to resign. Finally, Trump and his advisors have constantly attacked the Congressional Budget Office for supposedly making up economic data to hurt Trump, even though there is no evidence whatsoever of this activity. Major elements of Maduro’s economic policy in Venezuela have included a takeover of the central bank to dramatically increase monetary stimulus for political gain (leading to hyperinflation) and the packing of the independent statistical agencies with loyalists who doctored data to increase Maduro’s popularity. Here, Maduro seems much closer to Trump than to the Democratic Party.

As the 2020 election approaches, Republican attacks on the Democratic Party and its candidates as socialists and Venezuela-lite will undoubtedly escalate. But for all of their condemnation of anti-market and authoritarian impulses in Venezuela, their man in the White House is the greatest embodiment of such sentiments in modern American history. As is so common with Trump, this new line of attack is simply an attempt at misdirection from the real economic achievements of Democrats and Republicans over the past generation. Contrary to the arguments portraying Democrats as scary socialists, the Democratic economic approach has actually produced far better results than that of Republicans. Since 1989, four times as many jobs have been created annually while Democrats have been in the White House than when Republicans have been. Similarly, median income has on average fallen under Republican Presidents while it has risen under Democrats, and the budget deficit and uninsured rate have on average increased under Republicans while they have declined under Democrats. If Republicans want to find a party that has mismanaged the economy and adopted increasingly authoritarian ideas, they should look in the mirror.

Congress Should Warn The President Against Levying Tariffs On Europe

We are at the point now where Congress should send a clear message to President Trump that if he chooses to put tariffs on European automobiles and other goods in the coming weeks there will be consequences for his Presidency and his agenda in Congress.   Given the struggles Europe is having with Brexit, its upcoming May elections, and a slowing economy, launching tariffs at this particular moment would be rightly interpreted in Europe as an unnecessary and reckless hostile act and do grave and lasting damage to America’s relations with our closest historic allies.  Additionally, as we’ve written elsewhere, the President’s repeated evocation of emergency powers to levy tariffs without the approval of Congress is a dangerous abuse of Presidential power and should no longer be tolerated by leaders in either party. 

Events of the last few days have made this kind of aggressive action by Congress far more urgent.  First, the President’s son, Don Jr, penned an op-ed in a UK newspaper attacking Prime Minister Theresa May for her ineffective management of Brexit during perhaps the most consequential week of this sorry saga.  An extraordinary step, the op-ed demonstrated a willingness by the President’s family, and perhaps his government, to take dramatic action outside of all traditional diplomatic protocol to hasten the breakup of the European Union.  Second, the President has used remarkably hostile language about Europe in recent days, most notably in this exchange with the Irish Prime Minister at the White House last week.   With the Irish Prime Minister sitting next to him, the President said about Europe: “We are going to do something that’s pretty severe economically.  We are going to tariff a lot of their products coming in.” 

The formation of the European Union was one of America’s most successful and important post war projects.  In April, Europe and the United States will be marking NATO’s 70th Anniversary, and in May, Europe will be holding elections for representation in the European Parliament.  This should be a time to be celebrating our historic alliances and partnerships, not attacking them.  And at a broader level, Congress must now, as best it can, not just work to counter or mitigate the damage the President is doing to our nation and its interests, but to prevent it. 

While we believe anything the House and Senate do should be very aggressive, at the very least they should give serious consideration to two bills currently in Congress: the Bicameral Congressional Trade Authority Act of 2019, sponsored by Senators Toomey (R-PA) and Warner (D-VA) in the Senate, and Reps. Kind (D-WI), Panetta (D-CA), Gallagher (R-WI), and LaHood (R-IL) in the House, and the Automotive Jobs Act, sponsored by Reps. Sewell (D-AL) and Upton (R-MI). The Bicameral Congressional Trade Authority Act provides critical Congressional and Department of Defense oversight on the President's Section 232 ability to use national security as a justification to unilaterally impose tariffs, while the Automotive Jobs Act requires the federal government’s International Trade Commission to study the economic impact of auto tariffs before they can be implemented by the President.

With all of the warning bells ringing for the American and global economies, and our alliances with key trading partners, it is time now for Congress to engage and directly challenge the President on his irresponsible tariff policy.

Growing Recession Risks Could Make Trump Even Less Stable

In recent weeks, new challenges have emerged to the conventional wisdom that the US economy is largely doing fine. Growth is projected to significantly decelerate this year, with first quarter growth seen at only 0.4% by the Atlanta Fed and 0.9% by Goldman Sachs. Manufacturing output, a key leading indicator of economic activity, has fallen significantly over the past six months, and four major manufacturing indicators (ISM PMIMarkit PMIPhilly Fed, and Empire State Fed) now show US industrial activity at its lowest level since late 2016. Finally, the most widely trusted recession indicator in the financial markets - the yield curve - is now at its flattest level (indicating its highest recession probability) since 2008, and the NY Fed's recession model shows a 24% chance of recession in the next 12 months, an alarming reading considering that over the past 40 years there has always been a recession within 12 months when the model has reached 28%.

An economic downturn, accompanied by a loss in confidence in the economy among the public, could significantly harm Trump's chances in 2020. While the President continues to have the consistently lowest first term approval rating in the post-World War 2 period, it has been kept above disaster territory by relatively strong approval of his economic management. For example, March's Ipsos poll showed his net approval at -13, but his net economic approval at +6. If such a downturn were to happen, therefore, the bottom could easily fall out on his Presidency, and a serious primary challenge could be undertaken against the President. As a result, as the economy continues to weaken, we'll likely see a more unstable and increasingly erratic Trump, who will try ever harder to please his base with even more reckless policies in an attempt to hide the slowing economy.

Weekly Notes On The Economy is a weekly column that NDN writes on the most recent economic news, policy, and data.

With Growth Slowing, Trump Releases A Budget Devoid From Reality

This morning, the Trump administration released their budget request for 2020 and with it their economic projections for the next decade. Unfortunately, the document reads more like a Trump rally speech than a serious piece of economic literature, and contains projections at odds with virtually every independent analysis. The budget forecasts growth of 3.2% in 2019, even though the Fed, CBO, IMF, and every major bank (Goldman Sachs, JP Morgan, Morgan Stanley, and Bank of America for example) all project that 2019 growth will be 2.5% or less (the average 2019 projection for those seven organizations is just 2.2%). Even more implausible, Trump's budget forecasts that growth will stay at 3% and above through 2023. In reality, the IMF projects that US growth will be closer to 1.4% in 2023, while the CBO forecasts a growth rate of 1.7% in 2023. The administration's fiscal daydream doesn't stop here though. Much of the growth boost in 2018 came from sharply higher budget deficits that boosted aggregate demand (the deficit of 3.9% of GDP in 2018 was the largest deficit when unemployment was under 6% since 1950). Trump's budget, however, sees a budget deficit of 3.7% of GDP by 2023, compared to the CBO's current estimate of 4.6% in that year. What the administration is saying, then, is that they will have double the rate of growth in 2023 compared to CBO projections, while also having less fiscal stimulus than the CBO anticipates (stimulus that would presumably be necessary on an even larger level to achieve anywhere near 3% growth). 

Above all else, today's budget request is a desperate attempt to rewrite the economic narrative of the Trump presidency. Growth is slowing, not rising, and will likely hit its potential rate of 1.8% by 2020. This means that the President's promise that his tax cut would create sustainable long term growth above 3% was a lie. In addition, the budget deficit will continue to grow to unprecedented levels when outside of a recession (and indeed, the deficit for the first four months of FY 2019 is already 77% larger than the first four months of FY 2018). Trump's promise that his tax cut would pay for itself and that he'd balance the budget within his first term in office? Another lie. So far in Trump's presidency, growth has been strong because of a large fiscal stimulus that, while having little effect on long term growth and blowing up the deficit, increased short term growth. Now that the stimulus is wearing off, however, the reality of Trump's poor economic policies is becoming clear, something that could be politically disastrous for him in 2020. 

Weekly Notes On The Economy is a weekly column that NDN writes on the most recent economic news, policy, and data.

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