The following is a lightly edited transcript of the October 2 episode of the Daily Blast podcast. Listen to it here.
Greg Sargent: This is The Daily Blast from The New Republic, produced and presented by the DSR Network. I’m your host, Greg Sargent.
President Donald Trump unleashed a strange Truth Social rant on Wednesday, declaring straight out that farmers are getting hurt because China is not buying soybeans. Of course, Trump’s own trade wars are the reason for this—so in effect, he admitted that his own policies are badly screwing one of his core constituencies.
That’s amusing, but it also comes as some brutal economic news landed suggesting job losses could be about to get worse. The bigger story here is that the bad economic news is piling up at exactly the moment we’re entering a bruising government shutdown fight. And of course, a shutdown will make the economy even worse.
So does that mean Trump and Republicans will be in a weak enough position for Democrats to hold the line in the shutdown battle? We’re talking about all this with New Republic senior editor Alex Shephard, who has a good new piece arguing that Democrats are finally finding some spine in this fight. Alex, good to see you, man.
Alex Shephard: It’s great to be back.
Sargent: So let’s start with Trump’s post on Truth Social. Here’s what he said, “The soybean farmers of our country are being hurt because China is, for ‘negotiating’ reasons only, not buying. We’ve made so much money on tariffs that we are going to take a small portion of that money and help our farmers.” Alex, note how Trump says China isn’t buying soybeans for negotiating reasons, but leaves out how we got to this point, which is Trump’s trade wars. Your thoughts on that?
Shephard: Yeah, I mean, it’s also funny that he puts “negotiating” in inverted commas, as if there’s some other possible meaning for that word. But this shouldn’t have come as a shock at all. One of the things I found most surprising about this is that Politico’s agriculture newsletter—because of course they have a newsletter for everything—reported that the Trump White House was taken aback by the response from soybean farmers who are being crushed by these tariffs.
China has bought nothing for basically the entirety of the year. And what was shocking about that is that it happened in Trump’s first term too. When Trump started a trade war against China, to a less significant degree, soybean farmers were among the first targets.
Not only is this absurd, it’s also crazy that no one in the Trump administration could have seen this coming. And now they’re clearly scrambling. Trump is promising to rub some pennies together from the tariffs he’s bringing in. But this is just yet another sign that this trade war—OK, he’s doubled money from tariffs, but what it’s doing to the actual American economy is devastating for a lot of people, including a lot of people who happen to be Trump voters.
Sargent: Yeah. And Alex, it’s worth noting that this is a real calamity for those farmers. China bought over 12 billion dollars worth of soybeans last year. And this year, it’s nothing. And also to your point, when Trump says he will pay off the farmers with money from tariffs, well, that money was actually collected from importers who passed on higher costs to consumers who also happened to be Trump voters, or many of them are anyway. He’s basically admitting he’s really screwing his own people here. He’s taking money from some of his own people and he’s going to give it to others to mask the deep failure of his policies.
Shephard: It’s not just that though, too. The stated rationale for this tariff policy has shifted somewhat, but at its foundational basis, it’s supposed to rebuild American enterprise, manufacturing; it’s supposed to make Americans wealthy by building up their ability to make things. So I think the other thing that’s so absurd about this is that you have an actual successful industry. There is really no market for domestic American soybeans. If you’re an American soybean farmer, you sell them to foreign markets, most notably China. And so I think what you have here too is like an example of just how ridiculous this entire stratagem is that Trump is essentially like taking existing successful American industries that do export goods, in this case soybean farmers, and holding them hostage so he can, one, extort the rest of the world in the form of tariffs and claim that he’s making all this money, but also, two, build up successful American industry, or farming, manufacturing, whatever you want to call it. And what you have here is an actual successful thing. It’s being destroyed. And there’s nothing that this administration can point to that’s being built domestically because of these tariffs.
Sargent: And just to underscore the depths of the scamming here, Trump constantly says that other countries pay the tariffs. No, they don’t. We do. His own voters do. And on top of all this, the economic news is getting worse. ADP just put out its report finding that the economy lost 32,000 jobs in September. That’s the worst since March of 2023. They also revised the August numbers down from 54,000 gained to a loss of 3,000 jobs. A new report also finds that consumer confidence dipped in September. You’ve got the farmers getting clobbered. Now the government shutdown. It sure seems like the bad economic news is really going to pile up on Trump right now. What’s your reading of that overall picture? How bad is it?
Shephard: I think it’s been pretty bad for a while. Consumer sentiment has been a leading indicator for quite a while now, and it hasn’t always meant bad economic news. But you always had a situation where—you had the “vibecession” during the Biden administration—talking to a lot of Dem policy people, I think that was always misjudged to some extent. You could point to a lot of good numbers during the Biden administration, but at the same time, there was inflation, there were various things that made you feel like your dollar was being stretched more.
And I think what you have now is you have this tariff-related inflation happening at the same time as there are bad fundamental numbers, which was not true two or three years ago. Those things are really starting to compound each other right now. The general economic mood, just talking to regular people too, is really, really bad, and that’s now starting to be borne out in these numbers.
I think the effects of the shutdown are going to start to show too. And the only thing holding the line right now are the markets, which have shown an almost religious faith in Trump—or at least have said, as long as things don’t fall off a cliff, right, as long as you have the economic version of that AI video of the lady crashing into a bridge or whatever, [that] they’ll stick with the guy. But even that may start to crumble now. The mood plus the underlying numbers are combining in this way we really haven’t seen since the start of the pandemic, or maybe even since the fall of 2008.
Sargent: And Trump is in a very weakened state. The New York Times poll this week—which actually had somewhat better news for Trump in terms of his overall approval than most other polls—it also showed Trump getting killed on the economy. Fifty-four percent of voters disapprove of his handling of it versus 44 percent who approve. And get this: 58 percent of independents disapprove. That’s very bad. Independents are going to be critical in the midterms.
Alex, it seems like Trump is very poised to take the blame for a government shutdown, given all those underlying weaknesses. I mean, he’s out there telling his own voters that he’s going to have to hand them cash to make them whole after his policies killed them. I mean, I think this gives Democrats an opportunity to hold the line. What do you think?
Shephard: The other thing, too, is that traditionally the way this works is that the party that withholds its consent to keep the government open gets blamed. But what you have here is a very different situation, right?
I think the Democratic offer—which is essentially to keep the government open in exchange for extending Affordable Care Act subsidies, some rollback of the cuts to Medicare and Medicaid, and the One Big Beautiful Bill Act, and an assurance that you’re not gonna not spend funds allocated from Congress in the future—that really just rolls back to an ask of saying, “If you extend these ACA subsidies, we’ll reopen the government.” That’s really pretty reasonable.
And I think the fact is that if Trump wanted to, he could reopen the government by spending two hours on the phone. Any day this week, any day next week. It could just happen. He’s choosing to keep the government closed because he doesn’t feel like doing that. And I think that’s one of the things already apparent to a lot of people: This is a president who doesn’t actually want to do the work of governing.
He doesn’t care about making the economy function for people. He’s on this kind of weird side quest all the time—either with the tariffs or, again, in the case of the shutdown, you have the news today that they’re gonna continue construction of the White House ballroom.
I think there’s this absurd idea running through this government that whatever Trump wants is what his voters want. And that may be true for more people than I’d like it to be true [for]. But if you’re running a government that’s dependent on the consent of the governed, there’s just not enough people to do that. And I think that dam has actually already started to crack before this moment. The fact that all of this is compounding at the same time is really, really bad for Republicans.
Sargent: I’m really glad you underscored Trump’s fundamental laziness, which I think is lost on a lot of people. He hates the act of governing, he hates the details. He’s not a reader. He obviously can’t stand sitting still long enough to actually learn what Obamacare subsidies are.
A three-year-old could look at his public rhetoric about the situation, the subsidies ending and see that he has absolutely no clue whatsoever what the details are. What’s bizarre to me is that the Obamacare subsidies problem is going to absolutely clobber Trump voters as well. We’re talking about premiums going up for millions of Trump voters across the country.
That, plus farm country getting absolutely slaughtered by his tariffs.
To your piece—in which you wrote about Democrats finding a spine—Democrats, to their greatest credit, have constantly acted as if Trump is some invincible political figure. They’ve imbibed the Beltway punditry that treats him that way, that treats him as a master of political events at all times, no matter how bad things get for him.
But it does seem, as your piece captures, that there might be a bit of a shift where Democrats are starting to sense real weakness on Trump’s part. What do you think?
Shephard: I think what we’re seeing now is the possibility that this shutdown could really remind voters of the authoritarian aspects of this presidency, [something] that they have not fully responded to in polling up to this point.
Obviously, the voters who care deeply about this are many of our readers, your regular MSNBC types who’ve been focused on it for years. But that message has been hard for Democrats to communicate to median voters, independents, and so on. Trump’s obstinance here is underrated. It’s a refusal to reopen the government, but that means that it’s a government that’s essentially being run however he and Russ Vought want to run it.
Vought, the director of the Office of Management and Budget, is probably the third most powerful figure in Trump’s White House right now—behind Trump himself and Stephen Miller, at least since Elon Musk’s exit. He’s the author and architect, chief architect of Project 2025. He’s a pretty standard movement conservative in a lot of ways. He was at Heritage before he entered the Trump administration; he served in the first Trump administration too.
Where Vought is really smart is that he has a lot of old-timey, Heritage Foundation-y goals: shrinking the federal government as much as you can, and waging war on the administrative and regulatory state. And he has sold this to Trump by essentially painting it in Trumpian terms. He’s said, “Your first term would have been really successful, but the entire government bureaucracy was full of liberals who are secretly thwarting you.”
He’s extended Trump’s “deep state” argument, which really in the first term focused mostly on people at the DOJ and FBI, law enforcement agencies, and extended it across the entire federal government. By most reporting, Vought wasn’t thrilled with Elon Musk’s slash-and-burn approach, and wants to take a more targeted one. And he’s sold himself over the past few months, saying, “If you give me the opportunity to cut the federal budget, or to cut the federal workforce in a shutdown, I’ve been studying how to do this for years, and I will wreak havoc.”
That was enough to scare Schumer away from doing it in March. But he’s started to slowly roll out what he plans on cutting in terms of federal spending, as of Wednesday, October 1.
Sargent: Well, how do you see this all playing out exactly, Alex? Your piece seemed to suggest that you think Democrats might have discovered some sort of backbone in themselves to the point where they may actually try to draw this out. What should they do now? What are the prospects for that working over time?
Shephard: Yeah, I think that—not to bring it back to Vought, quickly, but I think that you can see how they respond in the actions he took on Wednesday, which is he cuts this big infrastructure project in New York and New Jersey. Well, what’s happening in New Jersey right now? It’s a pretty important gubernatorial race, that’s also pretty close.
And I think that you can see in the way that they’re going to do this shutdown, which is slow rolling these cuts: $15 billion to New York here, they cut $8 billion of green energy there. Tomorrow it’ll be another $20 billion. And I think Democrats can use these cuts to actually remind people of what it is the Trump administration is doing here.
And to your point about the law breaking, I think that the more power that Trump and Vought take for themselves during the shutdown—because you don’t have Congress there telling them not to do anything—the more you can draw attention to that aspect of this presidency as well.
I think this is gonna be a long shutdown. I think the Dems have given a pretty clear off-ramp, but there’s just no way that Trump takes it for a little while unless he’s absolutely made to take it. And I think that this is gonna be ugly, but it’s headed right now towards a position that Dems have quite a bit of leverage—more than they’ve had at any point this year.
Sargent: But Alex, do they know that?
Shephard: No, of course not.
Sargent: That’s the critical question, right?
Shephard: I think that that’s the issue, is that you could easily see—you already have three votes that have sort of defected, right? You could easily see the caucus start to erode and Schumer just throwing in the towel because they don’t have the stomach to deal with it.
I think what they should be reminded of is the last time that Republicans shut down the government, they gained seven Senate seats. The 2014 midterms. And I think that voters have a short memory. If they’re worried about the midterms for this, then it’s just way too far away from right now.
What they need to think about is the short-term effect of bringing down Trump’s popularity and communicating to voters what this administration is doing. I think they’re putting their own long-term concerns about the way that voters see the Democratic Party and their health going into the midterms ahead of the cart right now. The cart is just to damage this administration right now.
Sargent: It’s such a critical point and I’d like to unravel it a little more. Trump’s approval is the coin of the realm. Driving his approval rating down is the name of the game. That’s what everything should be oriented around.
And frankly, I think Democrats have kind of gotten their heads a little spun around by the way our political media discourse works. Anytime anybody points out that Trump’s approval is in the absolute toilet—and it is in the absolute toilet—somebody quickly rushes in, and mainstream reporters as well, someone rushes in to say, “But Democrats are also really in terrible shape.”
And so I think the effect of that constant drumbeat of negativity about Dems—and just to be clear, the approval rating of Democrats is less important than the approval rating of the president when it comes to the midterms, that’s just how politics works—and this kind of constant rush to say, well, Dems are also in a terrible position, has spun them to the point where they don’t actually keep focused on the prize, which is Trump’s approval going down.
Shephard: I think that the other reason why it’s stupid is that the main reason that the Democratic approval rating looks so bad is that their own base is furious with the party right now—that you have a lot of committed Democratic voters who are saying that they disapprove of the way that the party is handling Trump. So the idea that that somehow should affect their shutdown strategy is absurd.
You could argue that it gets to the complexity of the problem that they’re facing and that they have to appease the base while also winning over voters who think that they’re too focused on identity issues or whatever, but I just think that it doesn’t matter. The Democratic approval rating doesn’t matter now. It will matter maybe in six months or so, but the overall landscape for the midterms—you look at something like the special election that happened last week in Arizona, Democrats romped to victory there.
I think that the overall health of the party in terms of winning back one chamber of Congress, it looks fine—what they need to do if they want to win back both is to drive down Trump’s approval rating. And they’re not going to do that unless they shut down the government right now and get something in return.
Sargent: And just to go big picture, every single piece of data we see, everything we’re seeing in our politics points to a dynamic which is typical for a midterm after a party loses the White House in which that party is strengthened, emboldened, invigorated, angry. There’s just no reason to think the dynamics are, in some sense, going to be rendered inoperable by Trump’s magical political powers, or whatever it is that pundits seem to see in him. Democrats are in a position to win the House back and they’re in a position to take advantage of Trump’s weakness right now. I just don’t know if they know it.
Shephard: One of the things I found disheartening was the idea of the ACA off-ramp. I think it does make the party seem very reasonable, but what it also suggests is that this was not a shutdown that Schumer and Jeffries were angling for, right? That they were telegraphing to this administration the entire time that they would accept very little in return to keep the government open.
Now, I think that’s sort of played into their hand here, and you now have this bizarre environment where their ask was very simple, but now Jeffries, in particular, is just pissed off because of these racist sombrero videos, and Trump is just refusing to dig in. Republican senators don’t want to do this because it’s got “Obama” in quotation marks somewhere in the bill with the subsidies. But you’re staring down a long shutdown here, and it’s not clear that Schumer or Jeffries were prepared for that, but they better gear up because that’s where we’re headed.
Sargent: I think ultimately what the real story here is, is that Trump’s pathologies are going to force Democrats to take the right decision. Alex Shephard, it’s always a great pleasure to talk to you, man. Thanks for running through all that with us.
Shephard: Thanks. It was fun.