Welcome to my brand new “Not an Economist” series, where I talk about economics with the small caveat that I’m not an economist so I may very well be talking out of my ass. Enjoy!
With Congress coming back from a two week recess and the clock winding down until the midterms, word on the street is Democrats are ready to restart formal negotiations on another reconciliation bill. As I’ve argued in the past, the old Build Back Better wasn’t going to have much of an effect on inflation either way. It might have slightly increased inflation in the short term (and by slightly I mean a few tenths of a percentage point) because much of the spending was frontloaded, but it would have likely lowered inflationary pressure over the long term – since it was fully paid for and would increase the productive capacity of the economy. But, of course, that bill is dead. The new bill doesn’t exist yet but from what I can glean from what’s been reported it looks like it will be better designed to ease inflationary pressure, both in the short-term and the long-term, and will lower the burden of high prices on working families. For starters, here’s what the the bill will probably look like:
1. Lower the cost of prescription drugs 2. Extend the expanded Obamacare subsidies 3. Massive investments in clean energy 4. Raise taxes on those making more than $400,000 a year 5. Reduce the deficit
So how would these items lower inflation? Well the first two are self-expanatory. By allowing medicare to negotiate prices, the bill will bring down the cost of prescription drugs. Extending the Obamacare subsidies, which were made more generous by the American Rescue Plan, would keep out-of-pocket healthcare costs down for most people. These would have the added benefit of keeping people healthy so they don’t miss work and could help nudge those still sitting on the sidelines back into the workforce. More workers means we can produce more things which will help ease some of the supply-chain shortages fueling inflation. And more workers also means companies won’t have to compete as much for talent, which would lower the upward pressure on wages – another contributor to inflation.
Everyone is upset about the price of gas these days. Well while we can take steps to bring down gas prices in the short-term, a long-term solution would be to move away from oil and gas entirely to cheaper, cleaner sources of energy. Onshore wind and solar are currently the cheapest ways of generating electricity. Making the investments to expand these technologies will drive down energy costs and make us less reliant on other countries for our energy needs. I know everyone talks about wanting to be “energy independent” but the truth is that we only have about 4% of the world’s proven oil reserves. We consume around 20% of the world’s energy every year. The only way to be truly “energy independent” is to move to sources of energy we have in abundance here at home. As someone who lives in California, let me tell you, we’ve got plenty of sun. And I’ve asked some of my friends in Chicago. Turns out we’ve got plenty of wind too! The other benefit of doing this is that it will save lives. More than 100,000 people die in this country every year from air pollution. From a strict macro-economic standpoint more people alive equals more workers which means lower inflation.
It’s long been a charge from the right that raising taxes, especially for those at the top, slows economic growth and hurts the economy. Well for once there’s an argument that that’s exaclty what we need to do. It kind of confounds me that Democrats haven’t been pushing more for raising taxes on the wealthy, since it’s one of their most popular agenda items, and since it’s a natural solution to fighting inflation. If pumping too much money into the economy causes inflation, it stands to reason that taking money out of the economy will lower inflation. Raising taxes could slow economic growth and stunt job growth but in an economy that’s running too hot that might be a good thing. Taking excess money out of the economy and using it to pay down the deficit will have long-term benefits for the economy and lower inflation in the short term.
Finally I’d be remiss if I didn’t mention another bill making its way through Congress that could help with inflation. It’s the China competition bill. One of the big drivers of inflation early on was the rapidly rising price of used cars, as a semiconductor shortage made companies unable to produce enough new cars to meet demand. China’s recent lockdown of Shanghai, which has caused even more supply chain snags, is a good reminder of the dangers of relying on other countries (especially adversaries) for essential items. Investing in the manufacturing of these components here at home will help ease the burden of supply chains snarls, and ease inflationary pressure.
The truth is that there isn’t much fiscal policy makers can do about inflation. That is Fed’s wheelhouse. But we can and should act where we can to move things at the margins. The good news is Democrats can still pass much of their agenda without having to worry about increasing inflation. In fact, the small effect it will have on inflation will be to bring down prices. And that is good for everyone.
It’s easy to get lost in the minutia of day to day politics but I really think people are missing the forest for the trees. In the grand scheme of things Biden’s little spat with Manchin and Build Back Better isn’t really going to matter. The bill will pass and disappointment about what gets left on the cutting room floor will inevitably fade and give way to excitement about what IS in the bill. Think about the argument we’re having right now: Do we want universal pre-k or or a universal child allowance? Should we make the largest investment ever in combatting climate change or the largest expansion of affordable healthcare in a over a decade? Or maybe we should focus on the greatest expansion of civil rights and voting rights since 1965? These are not bad problems to have.
I just don’t buy all the punditry saying Joe Biden misread his mandate or made a mistake by going too bold and now people are inevitably going to be dissapointed. It’s easy to play Monday morning quarterback but let’s game out some other scenerios. Biden ran on a bold, progressive platform. What would have happened if he said, “Never mind. I only got 50 votes in the Senate, so all that stuff I said I was gonna do – I’m not even going to try.” He would have had a progressive revolt and thrown away any chance of doing anything. Biden has a difficult task before him – keeping the disparate factions of the Democratic party together and united behind his agenda – and in my opinion (Manchin spat aside) he’s done so masterfully.
I just finished reading Evan Osnos’ biography of Joe Biden (you can thank my long layover in Texas for that). I highly reccommend it. It really helps you understand what he’s doing and why he’s doing it. Here’s the Biden theory of the case: the only way to save our democracy is to prove that a democratically elected government can deliver results for people. Put another way, the only way to defeat Trumpism is to show Trump’s supporters that their voices are being heard and that they don’t have to turn to someone like Trump to get a government responsive to their problems. That’s why Biden’s been so singularly focused on Build Back Better. It’s why he’s billed the infrastructure bill a “blue collar blueprint to rebuild America.” And it’s working. Wage growth for those without a college degree has outpaced wage growth for those with a degree since January 2021 – the longest period on record.
The bad actors are going to act bad – that’s what they do – the only thing we can do is make the outrage they’re peddling less appealing. Remember: the outrage machine only amplifies anger and resentment, but there has to be an existing base of anger and resentment for it to amplify, and though you’re never going to remove all the things that make people angry or upset, you can reduce it to a level that is sustainable. Just like how reducing transmission of the virus allows society to function normally, reducing anger and resentment to a sustainable level will allow democracy to function. The only way out is through helping people, not punishing them.
Of course governing effectively is only one piece of the puzzle. There’s an important second piece too. If making the bad actors less appealing is step one, reforming democracy to shore up the weaknesses exposed by the bad actors is step two. Biden has gotten a lot of flack (including from me) for not paying enough attention to voting rights. Bad actors all across the country are using the “Big Lie” as an excuse to pass restrictions that make it harder to vote, and they’re likely to continue in 2022. Passing both the Freedom to Vote Act and John Lewis Voting Rights Advancement Act will push back against these state level restrictions and also put an end to gerrymandering, which causes increased polarization by making elections less and less competitive.
In order to pass both of these bills we will need to reform the filibuster – though filibuster reform shouldn’t be thought of as a means to an end, rather, reforming the filibuster is itself essential to saving our democracy. The fact is that one of the reasons people no longer believe democracies can deliver is because whichever party is out of power does their damnest to make sure the party in power can’t get anything done. Giving the minority a blanket veto over the majority’s agenda is insane and runs counter to the way our democracy was designed. Fixing the filibuster will allow our government to function as intended and be more responsive to the needs of it’s people – instead of our current state of affairs where politicians make big promises on the campaign trail that are impossible for them to fullfill once in office.
Finally, we need to update the Electoral Count Act to clarify the Vice President’s role in the counting of electoral votes and also what constitutes grounds for challenging a state’s votes. It’s unclear at this point whether this is something Democrats will have to do on their own or whether there’s enough establishment Republicans (I’m looking at you Mitt Romney) to pass a filibuster proof bipartisan bill. Obviously for big changes like this you’d prefer it to be bipartisan but if going it alone is the only way then that’s the route Democrats must take. This is just too important. Besides, both the 14th and 15th Amendment, which gave citizenship and voting rights to freed-slaves, passed on party-line votes.
Biden has not paid nearly enough attention to voting and democracy reform in the first year of his presidency but it looks like that is starting to change – a very welcome sign for those of us worried about the future of democracy.
Biden has a great task ahead of him: literally saving American democracy. But if he can pass Build Back Better, voting rights and election reform, on top of the infrastructure and COVID relief bills he’s already passed, that would go a long way towards meeting his goal of proving democracies can function. It would also safeguard our democracy against future attacks. I don’t know if it will save Democrats in the midterms but I would still call it a success – and though this has been said about every President, I think it’s the case now more than ever: Biden’s success is America’s success.
There’s no one more supportive of voting rights yours truly, but the rhetoric surrounding the fight is starting to get a little too heated and over the top. We’ve seen what can happen when you whip your supporters up into a frenzy and scare the bejeezes out of them with lies and propaganda. Let’s not do that again. So we all need to take a moment, pause, breathe, and try to think about this rationally. The election restrictions being passed in GOP state legislatures should be concerning – if for nothing else than for the sheer number of them – (so far 18 states have passed 3o laws that make it harder to vote according to the Brennan Center for Justice) but this isn’t Jim Crow 2.0, it’s not the end of democracy, and though we should be diligent about the prospect of election subversion, it’s not as imminent as some would have you believe.
The most concerning changes seem to be petty moves by GOP state legislatures to ‘punish’ people who wouldn’t do Trump’s bidding, and to give themselves more power over the administration of elections. In Georgia, for instance, Republicans stripped Secretary of State Brad Raffensperger of power by making him a non-voting member of the election board and made it so they can appoint the majority of the board’s members, which could lead the traditionally nonpartisan board to become overlty partisan. They also allow the election board to replace “underperforming” county elections superintendents. At first glance this seems like a blatant attempt to put a thumb on the scale, however there’s a 30 day period before hearings can even begin on a replacement, so it would be impossible to overturn an election after the fact; and there’s protections against the election board simply appointing a partisan footsoldier (the person must not have been a candidate or donated to a political campaign in the two years prior to appointment). Brad Raffensperger recently called for the Fulton County election superintendent to be fired, so we’re likely to get a real-time test of whether this provision could lead to election subversion or not. I would advise people to watch the proccess carefully and skeptically, but it’s not time to start freaking out about it just yet.
With all that being said, race can’t be ignored. While some of the effects these restrictions will have on voters of color have been overstated, many of them will still disproportionately affect black voters and it’s probably not a coincidence that in the last two elections (2018 and 2020) 92% of black voters supported a Democrat.
So why are Republicans doing this? I don’t know. Maybe they’re just playing to Trump’s base, maybe they believe it will help them win elections, or maybe they really do believe the lies about fraud in the last election. They’re obviously aware that many of these things will disproportionately affect black people, and that black people vote for Democrats more than nine times out of ten, but does that make them racist or does it just make them shameless partisans?
We should fight them. We should challenge them. We should ask them to explain why these measures are necessary, and what they have to say to the voters, especially voters of color, who will be dispropotionately affected by these laws, but we shouldn’t give in to fear mongering, race-baiting, and outright lying about what these laws do and what they don’t do.
But we need to go further than that. We need to pass the For the People Act and the John Lewis Voting Rights Advancement Act. Not to save democracy from it’s imminent demise but to make our democracy better, stronger, and more inclusive. We need to pass them based, not on fear but on the simple fact that they are good bills based on tried and true reforms passed at the state and local level by Republicans and Democrats alike that will make voting easier and more accessible, make our elections more secure, end partisan gerrymandering, get big money out of politics, and make sure our elected officials are held to the highest ethical standards.
We should also pass laws to prevent election subversion, not because it’s imminent, but because it’s good policy to safeguard our elections. Let’s start by reforming the Electoral Count Act, which seems to be our biggest achilles heel. Right now a simple majority of each house of Congress can reject any slate of electors for whatever reason they like. It makes no sense that it takes 60 votes to secure voting rights but a simple majority to overturn an election.
I do believe our democracy is in peril. But it’s not because Georgia makes you put the last four digits of your social security number on your absentee ballot or because Iowa went from 29 days of early voting to 20. Donald Trump is a threat to democracy. January 6th and the prospect of a future attack are threats to democracy. These laws are only a threat to democracy insofar as they feed into the false narrative that the last election was stolen or that democratically elected leaders are not legitimate. We have to be vigilant but we also have to be honest. We can’t defeat Trumpism by becoming like Trump, and we won’t defeat the “Big Lie” with a “Big Lie” of our own.
The slide to autocracy doesn’t happen overnight, and nobody announces that it’s coming. It happens gradually, under the guise of “law and order” and “election integrity.” It happens when nobody is watching. When people let their guards down, and more often than not, you don’t realize it’s happening until it’s too late. So it’s worth taking a look at what that slide might look like.
First, let’s assume there isn’t going to be a violent coup that reinstates the former President by August. I hope that’s a safe assumption. That brings us to 2024. For simplicity sake, let’s say that 2024 will be a rematch between Joe Biden and Donald Trump and that the vote will be exactly the same as in 2020, i.e. Joe Biden wins the same states by the exact same amount which, using the new allocation of electoral votes, would produce the following map.
With the firehose of falsehoods we saw after the last election and the sizeable segment of the population that still believes the false narrative that the election was stolen, it’s not out of the realm of possibility that Congressional Republicans, under considerable pressure from Trump and his allies, would overturn the results in 2024 and throw the election to Trump. And with Republicans well positioned to take back the House in 2022, and the Senate in 2024, it’s fairly likely that they will find themselves in the position where they have to make a choice: Donald Trump or democracy? Do you trust them to choose wisely?
More broadly, voter fraud is extremely rare. Study after study, court after court, partisan commission after partisan commission (and when I say partisan I mean Republican) have failed to turn up any evidence of widespread fraud. Proponents of voter fraud like to point to the Heritage Foundation’s database which, as of this writing, has 1,322 proven instances of voter fraud. But that goes back to 1982, a period during which over 3 billion votes have been cast in federal elections alone. That’s a rate so low, my calculator doesn’t have enough space for all the zeroes.
For this story though, I want to focus on another claim I often hear, which is, that voter fraud is going on undetected. To a certain extent this claim is unfalsibiable, meaning it cannot be proven true or false. Unfalsibiable claims are especially dangerous, since they’re able to just hang there in the ether. But if massive voter fraud were going on undetected, there would be certain clues, anomalies in the data, that would be a pretty clear give away.
Of course, I am not the only person to contemplate this question. In fact, people way smarter than me have contemplated it. Researchers at Harvard and Stanfod did a study last year using statistical analysis to try and estimate the amount of double voting in the 2012 election, looking at the national voter file. What they found was a rate of one double vote for every 4,000 voters. But when factoring in a poll book error of 1% (the error in Philadelphia), the rate drops down to 1 in 13,000 voters. A poll book error of 1.3% would explain all of the discrepancies.
So as you can see (and I hope this is the last time I have to say this, but I have a feeling it’s not) the election was not stolen, voter fraud is rare, and it unlikely that it’s happening on a massive scale undetected. Put another way: Arizona auditors are using UV lights to search for signs that ballots were flown in from China, they’d be better off shining those UV lights inside their bodies to cure themselves of coronavirus.
We all know by now that Joe Biden won the popular vote by about 7.1 million votes or 4.5 percentage points. But that doesn’t tell us much, being that we don’t elect the President by popular vote. We know that Biden won the electoral college 306-232. But that doesn’t tell us the whole story either. An election where you win by 74 electoral votes and your margins in the swing states are huge is much different from an election where you barely squeak by in those states. So the logical answer to this question would be Biden’s combined margin in the states that put him over the top (Arizona, Georgia, Wisconsin). Trump came within 42,918 votes of winning in those states, meaning if 42,918 voters in those three states voted differently, we would have had a 269-269 tie, which would have effectively ended with Trump being reelected. So there you have it. Biden won by 42,918 votes.
Not so fast! It’s highly implausible that 42,918 voters in those exact three states would change their votes without any voters anywhere else in the country changing their minds. In order to get those 42,918 votes to change you would need a shift in the national mood. So the real answer for how much Biden won by is how much the national mood would have needed to shift in order for 42,918 voters in Arizona, Georgia and Wisconsin to switch. Luckily this is fairly easy to do. All you need to know is Biden’s margin in the state that gave him his 270th vote, i.e. the tipping point state. The tipping point state in 2020 was Wisconsin, which Biden won by .63%. That means if the entire nation shifted .63% towards Trump, he would have won. Put another way, if Biden won the popular vote by 3.8%, instead of 4.5%, it would have resulted in a 269-269 tie, which would have likely ended with the House awarding the Presidency to Trump. For Trump to win outright, the nation would have needed to shift 1.2 points, the margin in Pennsylvania.
So bringing this back to our original question: how much did Biden win by? Well, there were 158,397,726 votes cast in the 2020 election. 0.63% of that (the margin in Wisconsin) is 99,791. 1.2% of that (the margin in Pennsylvania) is 1,900,773. So Biden won by 99.8K or 1.9M depending on how you look at it. The 2020 election was not close in terms of the popular vote, however because of a 3.5% Republican bias in the electoral college, the highest in 70 years, Trump came within about a million votes of tying (and thus winning) and about 2 million votes of winning the election outright.
I have good/terrible news, depending on your viewpoint. Democrats are not going to pack the Supreme Court or end the filibuster. At least not any time soon. How do I know this? Well if we learned anything from President Joe Biden’s first 100 days it’s that he’s a politician first and foremost. His governing strategy seems to be: do popular stuff. His American Rescue Plan enjoyed broad support from the American public. His American Jobs Plan and American Families Plan both also enjoy majority support, though it should be noted that the American Families Plan, which was just released on Wednesday, hasn’t been polled much. I don’t write this to brag about how popular Biden is, I write it to say that Biden seems to have made the calculation that if he does things people like, he will be rewarded.
Packing the court does not have the support of a majority of Americans. A Mason-Dixon poll found that 65% of American were opposed to the idea while only 31% were supportive. It’s worth noting though that the question was prefaced by saying, “For 150 years, the Supreme Court has had nine justices.” Still, a Reuters/Ipsos poll found similar results with 38% supporting and 46% opposed. Interestingly, that poll also found that 63% supported term limits for Supreme Court justices. And a YouGov/Washington Examiner poll from back in October found only 34% supported increasing the number of justices, even while a majority (51%) felt the Senate should wait to consider Amy Coney Barrett’s nomination until after the election. Biden, the weather vane that he is, is not likely to push for something supported by only a third of the country.
The legislation to pack the court that Democrats introduced earlier this month is dead on arrival, as more than enough Democrats in both the House and Senate have come out against it, and Nancy Pelosi has said that she has no plans to bring it to the floor. The commission Biden set up was a way to fullfill a campaign promise and placate liberals while not actually having to do anything. When a politician sets up a commission to study something, that usually means that thing isn’t going to happen.
Polling on the filibuster is a little more muddled. A recent poll from Monmouth found only 19% supported getting rid of the filibuster entirely. 38% wanted to keep it with reforms and another 38% said keep it with no changes. Support for the filibuster overall was also very evenly split. 34% support, 34% opposed, with 33% having no opinion. An Economist/YouGov poll found support for the filibuster evenly split as well, with 47% saying filibusters are mostly good and 53% saying they’re mostly bad. As far as reform ideas go, the most popular was requiring Senators to hold the floor, which got 53% support. Finally, a Business Insider poll asked people about the filibuster and the most common response was “I don’t have strong feelings about the filibuster” (36%). Only 20% supported getting rid of the filibuster while 21% supported requiring Senators to hold the floor, and 17% said the filibuster is fine as it is.
These polls vary but there are a few common threads. Only about 1 in 5 people support getting rid of the filibuster entirely. The most popular solution seems to be bringing back the talking filibuster, and about 1 in 3 people don’t have a strong opinion either way. This last point is interesting because it suggests that there are still a lot of persuadable people out there.
With both court packing and filibuster reform the support just isn’t there right now and Biden and Democrats, with their eyes on 2022, are unlikely to move on something if the support isn’t there. If they want to make these changes they will likely have to build a case first. If, for instance, the Supreme Court starts striking down popular policies, public opinion may turn. Similarly, if Republicans start abusing the filibuster again to block Biden’s agenda, an agenda that is likely to continue to include popular items, support for reforming or abolishing the filibuster will likely go up. But right now, it’s hard to argue that you need to get rid of the filibuster when Republicans haven’t actually used it since 2014, the last time they were in the minority.
So breath a sign of releif conservatives, and one of exasperation liberals, the filibuster and the nine member Supreme Court are here to stay. At least for now.
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