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Middle-Out Up

Biden’s Biggest Job Now: Crush the Economic Argument

Events have conspired to give the president a chance to start putting the grand economic vision he articulated during the State of the Union into practice.

Alex Wroblewski/Getty Images

Tomorrow, Joe Biden’s State of the Union address becomes three weeks old. And with the brain-churning news cycle we all live with these days, that means that most people have probably already forgotten what he said that night. So let me open by reminding you that it was a great speech from a class and economics perspective. I recently attended an event where I saw a couple dozen progressive economy wonks, and they were still palpably jazzed over Biden’s emphatic ditching of neoliberal economics in favor of a focus on lifting up the middle and working classes.

It’s up to the president and his administration to keep that momentum going. For starters, he certainly should get himself out to East Palestine, Ohio, to visit with people. Yes, the right-wing criticism that he cares more about Ukraine than Ohio is ridiculous. Ukraine is goddamn important; he needed to be there as the anniversary of Putin’s invasion approached. His trip to Europe, both the Kyiv and Warsaw stops, constituted probably the most important European trip by a president since Roosevelt went to Yalta. Half the people who took potshots at him are probably secretly (or in some cases not so secretly) pulling for Russia anyway.

But now, Ohio awaits. The president is really good at building empathic connections to people who have experienced loss or are enduring worry; he should do fine in that setting. But there’s something far more important than local face time: Biden should focus the country’s attention on the way Wall Street is wrecking (literally) the freight-rail industry. The New Republic’s Tim Noah ably described all the ways that moneyed interests had hollowed out the industry last September at the time of the strike—laborers got Dickensian working conditions, communities got massive resistance to reasonable regulation, and the fat cats got the highest profits of any industrial sector in America.

In an interview over the weekend with ABC’s David Muir, Biden mentioned—twice—that the railroad companies make “tens of billions of dollars in profits.” The big four freight-rail companies are hauling in profits of around 50 percent (the average profit margin in American business is just under 10 percent). And, of course, they’re spending a lot of that money on stock buybacks to make themselves even richer. They’re a huge target, and making them into a bad guy is exactly of a piece with the middle-out economics Biden is making the centerpiece of his policy campaign. Taking a stand against the highest-profit employer in America would send a strong signal that he means what he says about sticking up for the little guy—and that he’s ready and willing to make some enemies.

Meanwhile, here’s what we know Biden is doing this week: A White House official tells me that Biden is going to Virginia Beach Tuesday “to highlight how Republicans are threatening default and economic catastrophe unless they can force through” their right-wing, soak-the-worker agenda. Biden “will release his Budget on March 9,” said this official, “and congressional Republicans should provide that same transparency. The American people deserve to know what Republicans are looking to cut, given that in countless previous budgets they have repeatedly proposed devastating cuts to essential programs like the Affordable Care Act and Medicaid, which are lowering costs for tens of millions of Americans.”

Obviously, the Republicans won’t offer any transparency beyond saying they’re going to cut all that woke spending by the Pentagon. They never tell the truth about their spending priorities, because they really only have one, or I guess now two. The one traditional GOP spending priority is to do as little of it as possible, especially as concerns poor people, people of color, senior citizens living on tight budgets, and other people with no political power. The second priority is to militarize the border. Or is it? I think that deep down, they’d rather talk about the border than do anything about it.

Actually, the Republicans have already released a blueprint. The main headlines it generated announced that it will boldly protect our children from the Democrats’ evil trans agenda. More substantively, the chapter titles tell us what we need to know: “Ensuring Liberty Through Deregulation”; “Creating Opportunity Through Tax Reform”; “Saving Medicare” (be very nervous when you hear a Republican use the word “saving” in that context); and “Make Social Security Solvent Again.” (Why not “Making,” Mr. GOP copy editor?)

That, too, will be a great fight to pick. Republicans have said, following Donald Trump, that cuts to Medicare and Social Security are off the table. And they say they want to balance the budget in a hurry. Combining those two conditions will require, according to Congressional Budget Office numbers, cuts of 44 percent to everything else. That is impossible. What’s more is that it would be tremendously unpopular. They know this, which is why they lie all the time. Biden and the Democrats have to play offense. Especially with a critical mass of House Republicans willing to drive the country into default over the debt limit.

Biden is pointing his party in a great economic direction. But this is going to be a long fight, and victory is far from assured for one simple reason: Americans still believe that Republicans are better at handling the economy.

I study these polls pretty closely. In every situation—whether a Democrat is president or a Republican, whether the economy is doing well or poorly—poll respondents give Republicans a roughly seven- to 15-point edge when asked which party is better at running the economy.

This, I presume, is because the Republicans are the party of business, so people just figure that if most corporate honchos back Republicans, they must be better for business and thus the economy. The facts point dramatically in the opposite direction. To take just one statistic that practically no one in America knows, let’s compare the increase in the Dow Jones Industrial Average under Bush, Bush, and Trump versus Clinton and Obama (16 years each). The DJIA increased 26 percent under the Republicans. Under the Democrats, it shot up 185 percent. Those are not typos. You can read more along these lines in this column I wrote for The Daily Beast before I came to TNR.

Middle-out economics needs to be the theme of Biden’s reelection campaign. And Biden and his party must turn these poll results—this universal presumption about which party is better with the economy—around. If they can do that, and if the economy is in decent shape next year, not only shouldn’t 2024 be especially close, but Democrats should be able to become the majority party in this country again. And this time, without shaking hands with all the Southern racists, as Roosevelt did.