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Can inflation kill a presidency? | ticker VIEWS

Published

1 year ago

November 15, 2021

Bruce Wolpe

Ask two of the last three one-term presidents. Both Jimmy Carter and George HW Bush suffered economies that veered out of control, with inflation surges followed by the inevitable interest-rate tightening by the Fed and recession

BRUCE WOLPE ON TICKER NEWS

Both failed at re-election. (It took an act of God – Covid – to strike down the third one-term president: Trump.)

On this most important Monday for Joe Biden – signing into law the largest investment in infrastructure in modern American history, and engaging in the most important summit of his time in office with China’s Xi Jinping – there is a raging political undercurrent: Will inflation also kill Joe Biden’s presidency?

Presidents own the economy and inflation gets everyone’s full attention.

As Politico reported last week’s data from the Bureau of Labor Statistics:

“Gasoline prices are up 49.6% … fuel oil up 59.1% … utility natural gas up 28.1% … used cars and trucks up 26.4% … beef prices are up 20.1% … pork up 14.1% … bacon up 15.4% … chicken up 8.8% … eggs up 11.6% … milk up 4.3% … apples up 6.7% … coffee up 4.7% … peanut butter up 6% … baby food up 7.9% … prices for furniture and bedding costs had their biggest jump since 1951 … prices for new cars and trucks had their biggest jump ever.”

Larry Summers, who served as Treasury Secretary under President Obama, warned in February – to vehement disagreement from the White House – that Biden’s American Rescue Plan could trigger an inflation wave:

“There is a chance that macroeconomic stimulus on a scale closer to World War II levels than normal recession levels will set off inflationary pressures of a kind we have not seen in a generation, with consequences for the value of the dollar and financial stability.”

The White House pushed back hard on Summers’ analysis.

“The risks of doing too little are far greater than the risks of going big,” one official said. Biden had to go big and go early to get liftoff for the US economy, which is now booming with growth over 5%. Jobs are up and unemployment is down. Wages are up and the job market is strong.

The general consensus among economists is that inflation pressures are not as structural as in the run-up to previous recessions: the choppiness caused by Covid and the severe supply chain disruptions are the main drivers of goods shortages and price pressures. In short, for today’s US economy it is not 1979 or 1992.

But that does not help the pocketbook and the outlook. Inflation is taking back some of the wage rises for workers.

It makes Biden an easy mark for Republican hits that Biden’s socialist reckless spending spree will inflict immense harm.

As a result, Biden’s slide in approval to the 40s, and the rise in his disapproval to over 50%, and the current mood, held by 70% of voters, that the country is on the wrong track, has all coincided with inflation’s emergence in the past four months.

The inflation wave is cresting right at the moment Biden is pressing Democrats to unite and pass his Build Back Better program: $1.7 trillion in social programs and climate investment that will lower costs for children, education, seniors, health care, and promote a decisive shift from fossil duels to renewable energy.

But even the inflation hawks believe that the infrastructure bill Biden will sign into law today and the social rebuilding program before Congress right now are right for the economy. Summers himself sees them very positively:

“I think it’s fine. The 10 years of the two spending bills together, A, are less than the one year of what they did last spring, and, B, unlike what they did last spring, are paid for by tax increases. So I don’t think that’s an inflation problem. I think a lot of it is vitally needed investments in the future of the country.”

Biden is counting on this calculus, and the proven polling appeal of all the elements of his program, to keep the Democrats united and to see this legislation through. We will know the outcome by Christmas.

Biden always plays a long game: it took him 32 years to win the presidency.

He is working to bring home what the US economy could look like next year: Delta in retreat, robust growth, the supply chain fixed, inflation ebbing, wages up, jobs growing, significant investment in infrastructure across the country, support flowing to families and their kids, health care costs lowered, clean energy blooming.

That is his bet on the American people for 2022. And he never, ever bets against them.

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Bruce Wolpe

Bruce Wolpe is a Ticker News US political contributor. He’s a Senior Fellow at the US Studies Centre and has worked with Democrats in Congress during President Barack Obama's first term, and on the staff of Prime Minister Julia Gillard. He has also served as the former PM's chief of staff.

World

Why Trump’s historic indictment won’t dampen his support

Published

17 hours ago

April 1, 2023

ticker NEWS

Donald Trump: polling suggests criminal charges won’t dampen his support

Donald Trump’s impending court case marks an historic moment in US politics. He will be the first former president of the United States to face criminal charges and trial by a jury. He and his supporters are already calling the case a political manoeuvre designed to reduce his chances in the 2024 presidential election.

The court case will affect his campaign but it will not exclude him for running for office next year. Early indications suggest that his political base will continue to rally around him. Within hours of the news, his followers were gathering outside his Mar-a-Lago home in Florida to express their support.

The indictment comes after a grand jury in New York agreed that there was enough evidence to charge the former president. The investigation, led by Manhattan district attorney Alvin Bragg, looked into the legality of hush money payments to former adult film star Stormy Daniels.

The exact nature of the charges will not be known until Trump is arraigned next week. According to US reports, he is likely to be accused of more than one count of falsifying business records (classed as a misdemeanour, a lesser crime in the US legal system), after Trump allegedly recorded the payment as a business expense. If found guilty, he could face a fine.

He might also be charged with breaking election campaign laws, which is a more serious felony offence and carries a potential prison sentence. Trump has denied any wrongdoing.

Any criminal charges, or even a jail sentence, would not restrict Trump from running for office under the US constitution. He has previously stated that he would do so even if he was charged. Historically, there are instances of individuals running for president while facing charges or even from a prison cell.

What may affect his chances is the amount of time that he will need to commit to dealing with the charges laid against him. To date, his campaign has been relatively quiet, but it will need to gain momentum in the lead up to the Republican convention in July 2024.

On March 25 and 26, Trump held his first campaign rally for the 2024 election at Waco, Texas. Despite predicting that he would be arrested, thousands turned up to show their support.

Claiming that the 2024 election would be “the final battle”, Trump criticised the prospects of potential challengers, such as Florida’s governor, Ron DeSantis, and stated that the investigation was like something out of Stalinist Russia. He told his supporters “from the beginning it has been one witch-hunt and phony investigation after another”.

Trump’s immense popularity with Republicans is unlikely to be damaged by any indictment resulting from the New York investigation. One poll showed that most Republicans believe that the investigation is politically motivated, while another indicated that most Americans think that Trump will be acquitted of the charges.

The Harvard/Harris poll shows that popular support for the charges is split along party lines – 80% of Democrats believe he should be indicted, while 80% of Republicans believe he should not. And 57% of Republicans think a trial could help Trump in the election run.

Republicans lawmakers have already come out in support of Trump. House Speaker Kevin McCarthy said that the indictment was an “unprecedented abuse of power”. House Majority Leader Steve Scalise tweeted that the charges were “one of the clearest examples of extremist Democrats weaponizing government to attack their political opponents”.

Even Trump’s potential rivals for the 2024 nomination have come out in support of the former president. DeSantis said the charges were “un-American” and a “weaponization of the legal system”, while Pence called the indictment “an outrage”.

For many observers, the question remains: why does Trump still figure so highly in the Republican polls after everything that has happened?

A Harvard/Harris poll from mid March, shows that Trump has increased his favourability among Republican voters to 50%, giving him a 26-point lead over DeSantis, if the presidential nomination was decided now. Former vice president Mike Pence is a distant third with just 7%. A more recent Fox News poll makes the gap between Trump and DeSantis to be even greater at 30%.

Worryingly for Democrats, those polled of all political persuasions give Trump a four-point lead over Biden. There is a glimmer of hope for the Democrats, though, in that 14% of those polled were undecided on either Trump or Biden. It’s a significant number, and those individuals will be key to deciding who wins the election in November next year.

Trump’s immense popularity with Republicans is unlikely to be damaged by any indictment resulting from the New York investigation. This is because the Republican Party is still the party of Donald Trump. His base support has never fluctuated since 2016. Many of them feel he stands up for them when no-one else does.

His Republican opponents, such as DeSantis, are trying to outdo Trump at being Trump. But they are pale imitations, and Trump knows this.

Earlier this year, Trump told the crowd at the Conservative Political Action Conference: “I am your warrior, I am your justice.” And they believe that. His supporters believe that he is the only person capable of protecting their values and way of life.

In a supporting speech at Waco, Trump-ally, Representative Marjorie Taylor-Greene said: “Trump is the man for the hour. He’s the only man who can take on Washington in the times that we live in.”

While the indictment might make some moderate Republicans rethink their loyalty to the former president, his base will back him to the bitter end.

World

‘Let him go’: Biden calls out Russia over reporter spy arrest

Published

17 hours ago

April 1, 2023

ticker NEWS

President Biden called for Russia to free Wall Street Journal reporter Evan Gershkovich, an American citizen who has been accused of spying on behalf of the U.S. government.

“Let him go,” Biden told reporters when asked about Gershkovich’s arrest.

Russian state news agency TASS has reported that Gershkovich was ordered to be held in custody until May 29. He is spending his third day in Russian captivity.

Asked about @WSJ reporter Evan Gershkovich, an accredited American reporter, who was arrested in Russia on espionage charges, President Biden said, "Let him go" and added there is a process. pic.twitter.com/rdT4376D4Y

— Kelly O'Donnell (@KellyO) March 31, 2023

Russia’s main security service, the FSB, claimed Thursday that Evan Gershkovich, a correspondent based in Moscow, had been trying to obtain state secrets.

The Wall Street Journal rejected those allegations, saying in a statement that it “vehemently denies the allegations from the FSB and seeks the immediate release of our trusted and dedicated reporter.”

A Russian district court in Moscow said Thursday that Gershkovich would be detained until May 29.

It is the first time an American journalist has been detained on accusations by Moscow of spying since the Cold War.

It comes a week after US authorities announced charges against a Russian national, Sergey Vladimirovich Cherkasov, accusing him of being a Russian spy.

World

How does Donald Trump’s indictment affect his chances of running for president?

Published

1 day ago

March 31, 2023

Costa Haritos

Donald Trump has become the first U.S. President to be criminally charged

Former U.S. President Donald Trump has been indicted by a Manhattan grand jury after a probe into hush money paid to porn star Stormy Daniels.

The adult film star maintains she had an affair with the former president, and was paid to keep it quiet. She said the sexual encounter occurred in 2006, a year after Trump married his current wife Melania, and over a decade before he ran for President of the United States.

While the payment was legal, it was allegedly recorded as a business expense, which is illegal in New York.

Daniels said the two had consensual sex.

Michael Cohen was Trump’s lawyer at the time, who made the $130,000 payment to Daniels in 2016, several days before the U.S. presidential election. He said he would “take a bullet” for Trump.

Two years later, he pleaded guilty to nine federal crimes including tax fraud, lying to Congress and campaign finance violations.

Cohen told CNN he was surprised about the timing of the indictment but “this is a long time coming.”

It means the former president will likely be arrested in the coming days. He will then enter a Manhattan courthouse, where he will be fingerprinted and have his mug shot taken.

“This evening we contacted Mr Trump’s attorney to coordinate his surrender to the Manhattan DA’s office for arraignment on a Supreme Court indictment, which remains under seal. Guidance will be provided when the arraignment date is selected.”
Alvin Bragg, MANHATTAN DISTRICT ATTORNEY

Alvin Bragg is the Manhattan District Attorney, who helped to sue the Trump Administration more than 100 times during its four-year term.

Trump has previously described the indictment as an attempt to “weaponise” the U.S. justice system.

In a statement, Trump’s lawyer said “he did not commit any crime”.

“We will vigorously fight this political prosecution in court,” the statement read.

What happens now?

The U.S. is fast approaching a presidential election, and Trump has signalled he will run for office again.

Many Republicans have swiftly defended Trump since the indictment came to light. This includes Nikki Haley, who is a current 2024 presidential candidate herself.

“This is more about revenge than it is about justice,” she tweeted.

Calvin Dark is a global affairs commentator in Washington, who said the reaction will be mixed among senior republicans.

“When it comes to Nikki Haley or former vice-president Mike Pence, they’re going to be an interesting situation.

“They’re going to want to use this to their political advantage to provide an alternative to many who might not want to nominate an indicted former president,” he said.

However, a criminal conviction would not prevent Trump from moving forward with his presidential campaign.

U.S. law does not stop criminals from running and serving as president—even if it’s from a prison cell.

“I think Ron DeSantis is going to play it pretty quiet. You might see a snide comment here and there. If you’re opponent is digging a hole, tell them to keep digging,” Dark said.

What does it mean?

Many U.S. conservatives believe the former president is being held to a different standard of justice.

Meanwhile, Democrats have viewed this through the lens of holding people in power to account.

“We are in unchartered legal and political territory,” said Bruce Wolpe from the U.S. Studies Centre.

“Trump has been telling his base that he’s done nothing wrong, and that he’s been persecuted politically.”
BRUCE WOLPE, U.S. STUDIES CENTRE

“His base is all in. This will not change Republican voter sentiment towards Trump as a political candidate for the presidency,” Wolpe said.

Trump is facing a string of other probes, including his efforts to undo the results of the 2020 presidential election, and whether he illegally interfered in Georgia.