Biden Bites Back

There's an underlying current in the presidential election campaign that could alter the dynamics of the race, and it's undoubtedly the economy.  Wall Street - still in a bull market despite COVID-19 - is expecting the economy to improve enough by October, and some - but not all - investors hope that the higher Dow helps Trump win re-election, because Trump has been so good for investors.  He hasn't been good for anything else, but he's been good for investors.  And polls still show Trump leading Biden on the economy, so if economic numbers go up just before Election Day, Biden's numbers could go down.  So Biden has moved to counter that.

This past Thursday, Biden went to his hometown of Scranton, Pennsylvania and unveiled an economic plan that promises $400 billion in government procurement of American-made products, $300 million in research and development, more investments in clean energy and a 28 percent corporate tax rate, up from 21 percent.  The idea, as indicated in the slogan in the picture above, is to build America back and make the country better than it was before COVID-19.  This all comes on the heels of a task force Biden had with Bernie Sanders and other progressives to produce a compromise economic strategy that includes greater support for the Affordable Care Act but eschews a Green New Deal program, indicating that the far left and the center-left in the Democratic Party are concentrating more on what unites them than what divides them.

Trump, of course, has accused Biden of ripping off his economic policy - although Biden's populist message espouses policies more labor-friendly than the corporate-friendly policies Trump has been pursuing despite his own populist rhetoric - and Trump's charge is undoubtedly meant to recall the 1987 plagiarism scandal that derailed Biden's first presidential campaign, when the showman-President Biden had hoped to succeed was Ronald Reagan.  But Biden should have more credibility on populist economics because of his background and his past support from labor.  His economic speech isn't and shouldn't be the final word.  But it's a good start.

Nevertheless, Biden still has some challenging days ahead.  His lead in the polls suggests that he may be peaking too soon, and there are numerous things that could being his numbers down besides an improving economic outlook - like a COVID-19 vaccine being announced before Election Day, which suddenly became a possibility when Pfizer announced it was getting close to one.  There could, of course, very well be problems with casting ballots as a result of the pandemic.  And Trump's politicized Justice Department could find a way to go after Biden on charges that he had helped spy on the Trump campaign when he was Vice President.  But cynical, amoral investors who shrug off the pandemic and racial inequality are, for now at least, still his biggest hurdle.  That, not Kanye West, is what Americans, especially Democrats, should be focusing on now.     

Adventures In Capitalism

You know the appeal of venture capitalism is losing its bite in America when even Republicans doubt it.

Mitt Romney used his New Hampshire primary win to denigrate the opposition for playing politics with the American capitalist system - not just President Obama but fellow Republicans like Newt Gingrich and Rick Perry. Romney says that both presdiential candidates focus more on the resentment of those who geet laid off in a bad economy rather than come up with a more positive economic message like his own - about how how government can help people become wealthy.  Both Gingrich and Perry have attacked Romney for how he made money in his job at Bain Capital - buying companies and firing a lot of people to make them more "competitive." Rather than explain how a venture capital firm works and explain to voters why this is a preferred method for resuscitating companies, Romney instead re-iterated his desire to help everyone become rich and accused his rivals for the Republican presidential nomination of giving the Democrats fodder for the fall campaign while accusing President Obama of wanting to transform America into a European-style social welfare state.

With Romney having moved to the right in his party, Obama is now obliged to defend his own turn from the center of American politics and explain how his leftward drift on economic issues - taxation, health care - is meant to benefit everyone. For the President, the 2012 campaign will be an effort to present the case for more government intervention in the economy even as Romney is already making his case (again, the old adage that our system allows people to work hard and hopefully become wealthy) against it.  But fewer people are buying that Horatio Alger message these days. Expect Obama's talking points to reflect the economic speech he gave in Kansas in December.

Obama doesn't have to worry about being called a socialist - he's not even that much of a liberal. But he can point to how he's created more jobs than Mitt Romney. General Motors has been hiring lately. Chrysler's sales were up 26 percent in 2011. Bailing out auto companies with government money did more for capitalism than taking over companies and firing people - or just letting them go bankrupt and possibly out of business, as Romney advocated in his opposition to the auto company bailouts.