What the Right Got Wrong About “Woke” Banks

The story of Silicon Valley Bank’s collapse isn’t terribly complicated. A bipartisan push for bank deregulation paved the way for incredibly risky behavior at SVB. As Bloomberg’s Matt Levine explained, the bank was funded by deposits from Silicon Valley firms and venture capitalists that exceeded the $250,000 U.S. deposit insurance cap and were “disproportionately” invested in “U.S. Treasuries and agency mortgage-backed securities” without much protection in place to guard against the possibility of an interest rate hike. “But then,” Levine notes, “rates went up a lot, pretty fast,” causing the “market value of SVB’s bonds to decline by some $15 billion, to the point … its losses on the bonds were enough to wipe out almost all of its equity capital and leave it with assets, at market value, worth only very slightly more than its liabilities.”

Moreover, the depositors were—as Adam Tooze explained—“in no regular sense, depositors” but, rather, “badly run and ill-advised businesses that for obscure reasons parked huge cash balances in a highly vulnerable bank.” These depositors were also “extremely prone” to the “influence exerted by a small group of VC advisors.” Max Read convincingly argues that those V.C. advisers essentially group-chatted the bank run into existence and touched off a stampede of depositors racing to get their money out of the bank’s coffers.

The plain and simple truth of what happened to SVP has, in some corners, inspired a constructive debate about sane policy solutions to prevent similar bank disasters. But inside the right-wing fever swamp, whose denizens are so deeply invested in tying everything of importance back to the weird notions that they are constantly entertaining, there’s a different story being told about SVB: It failed because it was “woke.”

The timing, for the purposes of this newsletter, could not have been better. Last week, I wrote about how the GOP has nearly completed its shift from a party that once diligently advanced conservative policy ideas to one that’s principally concerned with trying to invent a factual basis for its alternate reality. A prime example would be Tucker Carlson’s laborious attempt to backfill evidence for his claim that the January 6 rioters were peaceful sightseers. Then, right on schedule, came an incredible example of this phenomenon in the right’s reaction to SVB’s collapse.

As TNR’s Tori Otten reported,  a slew of conservatives—from Donald Trump Jr. and Stephen Miller, presidential aspirants Ron DeSantis and Vivek Ramaswamy, to myriad Fox News luminaries—responded to the news by making the case that wokeness was somehow to blame. This idea eventually made it to the Wall Street Journal op-ed pages, where columnist Andy Kessler mused, “In its proxy statement, SVB notes that besides 91% of their board being independent and 45% women, they also have ‘1 Black,’ ‘1 LGBTQ+’ and ‘2 Veterans.’ I’m not saying 12 white men would have avoided this mess, but the company may have been distracted by diversity demands.” I didn’t realize the right was disparaging veterans like this now.

It’s often the case that the constantly shifting definition of “woke” among right-wing thought leaders—or their hilarious struggle to define it altogether—makes it hard to get a fix on what they’re actually talking about, but in this telling it appears that these critics are mostly using “woke” as a byword for “having a diverse staff.” Unfortunately for everyone making the claim that diversity is the proximate cause of SVB’s failure, the merits of having a diverse workforce at financial sector institutions, as well as other firms, is something that has been relentlessly studied—and the consensus is that diversity is a much more profitable path.

For example, there’s a 2015 McKinsey study that found “diverse companies … are better able to win top talent and improve their customer orientation, employee satisfaction, and decision making,” which “leads to a virtuous cycle of increasing returns.” The firm’s 2019 follow-up study found that “top-quartile companies for racial and ethnic inclusion outperformed those in the fourth quartile by 36% in profitability.” A 2018 study of venture capital firms from Harvard Business Review found that diversity “significantly improves financial performance on measures such as profitable investments at the individual portfolio-company level and overall fund returns.” In 2023, Morgan Stanley Research examined 1,875 companies and found that those who scored better on the firm’s proprietary gender-inclusion algorithm outperformed less diverse firms. The findings, across multiple fields, are remarkably consistent.

The speed by which this omnidirectionally incorrect take about SVB failing on account of its wokeness spread was nevertheless impressive—as was the depth of its penetration: The Journal’s opinion editors have long been on a crusade to completely undermine both the specific work of its journalists and a free society in general, but it’s still remarkable to see them set fire to the paper’s reputation as the premier journal of the investor class by offering such compellingly wrong information about what practices are more profitable than others. It just goes to show that you should never doubt the extent to which the right are willing to over-leverage their reputations to make a bank run on reality itself.

Representative Jim Jordan rarely makes a public appearance in which he does not look psychically frustrated on some deep level, but he has been having—for his standards—a rough time of late. You see, the Ohio Republican is currently pulling double duty as chairman of the House Judiciary Committee and heading up his other brainchild: the Select Subcommittee on the Weaponization of the Federal Government, a weird star chamber in which the many tangled strands of the Fox News Extended Universe are expected to get a congressional hearing now that the GOP controls the House.

But as The New York Times recently reported, things have not been going well for Jordan. His first slew of ostensibly blockbuster whistleblowers have, according to Democrats on the panel, “offered little firsthand knowledge of any wrongdoing or violation of the law.” The Times reporters concur, describing the motley crew that Jordan has summoned as “people who do not meet the definition of a whistle-blower and who have engaged in partisan conduct that calls into question their credibility. Furthermore, it raises questions about whether Republicans will be able to deliver on their ambitious plans to uncover misdeeds at the highest levels.”

In fairness, these are the subcommittee’s early days. But what’s coming down the pike doesn’t look too promising. It plans to delve into a quickly scuttled plan to build a disinformation bureau at the Department of Homeland Security. It’ll be making hay over school board protests, a matter that Democrats on the panel seem well positioned to counter. And then there will be a fuller airing of the so-called “Twitter files,” Elon Musk’s seriocomic demonstration of the law of diminishing returns that now only occupies the imagination of a handful of people with Substack newsletters.

It doesn’t sound like a recipe for turning things around. And as Axios recently reported, Jordan’s penchant for overpromising and under-delivering has earned him a sizable share of friendly fire on the right. “This is doomed to fail,” tweeted former Chuck Grassley aide Mike Davis. Fox News’s Jesse Watters has expressed similar worries on his show: “Make me feel better, guys. Tell me this is going somewhere. Can I throw someone in prison? Can someone go to jail? Can someone get fined?” Jordan has mustered little to counter these charges besides bragging about how his panel has sent out more subpoenas and letters than any other committee. It’s an old Beltway song and dance: pretending that activity constitutes achievement.

Ah, but who could have predicted this, besides everyone who’s been paying attention? The Republican Party, having abandoned the diligent work of governing, rarely attempts to make policy anymore. What little it’s cobbled together on that front is a mix of the unpopular and the unviable. Without any substantive project to which the GOP might anchor itself, the party has instead become the party of off-putting weirdness. Instead of writing laws, they write lore—a constantly updating canon of bewildering grievances and spectral enemies.

It can be hard to keep up. With each passing day, some new piece of culture-war detritus ends up receiving the full force of the conservative movement’s ire. One week, they’re angry because a cartoon depiction of a candy isn’t sexually desirable enough. The next, they’ve dreamt up some weird “woke” collaboration between Wall Street and climate activists, to explain away the simple fact that investors are, for good reason, not bullish on the future of coal. And then there are the big hits: The 2020 election was stolen, the “deep state” is conspiring against Republicans, the January 6 rioters are actually political prisoners.

Jordan’s weaponization committee has been likened, by far-too-charitable people, to a reprise of the 1975 Church Committee that investigated abuses by intelligence agencies. But as Joshua Zeitz explained in Politico, the comparison doesn’t hold up. Where the Church Committee was a wide-ranging bipartisan effort that brought real wrongdoing to light, Jordan’s been tasked with backfilling some kind of factual basis for the conservative movement’s canon of anti-reality lore.

Naturally, Jordan is hardly alone in this mad mission to find some sort of meat to stuff in these nothingburgers. This week, Tucker Carlson has been spinning far-right myths with his reels of footage from the January 6 riots—to the apparent dismay of many Fox News staffers as well as several senior Republicans, such as Senate Minority Leader Mitch McConnell, who said, “It was a mistake, in my view, for Fox News to depict this in a way that’s completely at variance with what our chief law enforcement official here at the Capitol thinks.”

As my colleague Alex Shephard noted, Carlson’s attempt at revising history is all the more ironic given what’s been disclosed during Fox News’s long-running lawsuit with Dominion Voting Systems. Thanks to a voluminous cache of text messages from Fox News personalities, the world now has a pretty clear view that the network’s stars—Carlson included—never believed the central claims of a stolen election that sparked the January 6 insurrection.

But what’s all the more extraordinary is that what Carlson actually believes is a bunch of utterly normal stuff about Donald Trump. “I hate him passionately,” he texted, adding that he “truly [couldn’t] wait” for the chance to “ignore Trump most nights.” His assessment of Trump’s presidency was dire: “We’re all pretending we’ve got a lot to show for it, because admitting what a disaster it’s been is too tough to digest. But come on. There really isn’t an upside to Trump.”

This is the galling thing about the GOP’s entanglement with Trump. There were moments when the party could have rejected his destructive influence, but they demurred. Now, as Jordan and Carlson weave twisted fairy tales from their respective perches, I wonder if anyone will finally realize that it would have all been so much easier to simply tell the truth.

As the nation begins to ease into the presidential shadow primary, President Joe Biden seems to be on slightly firmer footing. His approval ratings are up, in conjunction with his recent State of the Union address, which was well received by the public. That his speech, a bold statement of intent for the next two years, was so widely admired should put wind in the president’s sails. As TNR’s editor Michael Tomasky noted, it was strewn with good notions on how to build an economy that works for working people—decent grist for a reelection campaign.

Good notions seem to be having a heyday. Democrats, having made a lot of noise about the high cost of insulin, got to watch Eli Lilly respond to the pressure and slash the price of this lifesaving medication. Democrats also recently bullied would-be Republican policy czar Rick Scott into backing down from the plan to sunset Social Security and Medicare that he’d so proudly stuffed into his policy manifesto. Now there’s even some bipartisan movement on a bill to help prevent rail disasters like the one that has endangered the town of East Palestine, Ohio. There’s still plenty of rancor and fury in Washington as the two parties battle for power. Still, it feels like we’ve fallen, for now, into a sweet spot where good ideas seem to have momentum.

Alas, in the midst of life, we are in death. For all this good news, the conditions remain ripe for bad ideas to flower. And there’s something eerily familiar about where we are right now: There’s a divided government, a Democratic president who hasn’t entirely lost his penchant for compromise, a looming debt ceiling fight, and a town full of deficit hawks forever circling their next kill. Biden’s Democratic predecessor, Barack Obama, faced more or less the same conditions during his tenure, and he wasn’t always successful. Biden has vowed not to repeat the same mistakes, but it’s hard not to feel a little bit spooked.

If you’re sensing the stirrings of an ill wind, you’re not alone. As Politico’s Adam Cancryn reported this week, Biden’s been contemplating taking on “a new economic persona,” and unfortunately, that persona is “deficit hawk.” According to this report, the president is looking to make “fiscal restraint” one of his administration’s watchwords, with deficit reduction an “increasingly central focus of his agenda.” As you might imagine, this isn’t being greeted with universal approval—some Democrats are worried that “it could undermine the case for future crisis aid—or backfire on Biden himself if the U.S. sinks into a recession that results in greater government spending and fewer tax receipts, driving the deficit higher.”

Meanwhile, trouble is brewing in another corner of Washington, D.C., where it is said that a bipartisan group of senators are looking at raising the retirement age to 70. Now it should be said that the word “bipartisan” is doing a lot of work in this telling: The proposal is the brainchild of a bunch of Republican senators and Maine’s often squirrelly independent, Angus King, who caucuses with Democrats. Raising the retirement age is a deficit-hack dream, but it would represent a substantial cut in benefits, hurt Black and working-class workers in particular, and redistribute a disproportionate share of the proceeds to high earners, who tend to live longer but don’t need the benefits as badly.

Naturally, there are better ideas at hand, chief among them being the raising or elimination of the income cap that currently allows the wealthiest among us to dodge paying their fair share into the Social Security fund. The status quo has resulted in a record share of earnings that aren’t subject to Social Security taxes; Tuesday, February 28, marked the last day this year that those earning a million dollars or more had to contribute to Social Security.

But there’s a big movement to finally change this, and Democrats have contributed two pieces of legislation that would soak the rich and save Social Security—the Social Security Expansion Act and Social Security 2100—which they, alongside Biden, can tout on the campaign trail. These policies are wildly popular. So much so that even Joe Manchin has rejected the idea of raising the retirement age and has backed lifting the taxable wage cap.

It says a lot about how much ground has been covered between the Obama administration and Biden’s tenure that you can count on Manchin’s support for this plan. It only underscores how this is the worst possible time to allow the deficit hawks and the austerity pimps a chance to return to prominence. They have no constituency beyond a few cable news green rooms and newspaper editorial boards. And they consistently back the wrong economic plays. Rather than fret over the government’s deficits, Biden would be well served to focus his attention on the household debts of ordinary Americans, go to war against the nickel-and-dimers of the GOP-backed Junk Fee Empire, take on the small town–destroying freight rail plutocrats, and fight to preserve these vital benefit programs that have fueled the Good Life in America.

This article first appeared in Power Mad, a weekly TNR newsletter authored by deputy editor Jason Linkins. Sign up here.

Have you ever noticed that so much of what’s sold as “good news” these days doesn’t seem all that good? There’s the self-sacrificing Texas teenager who’s helping her mom make ends meet by cashing out her own college fund. Or the Dallas–Fort Worth teacher who’s going the extra mile to keep her students’ achievement levels up by teaching from her hospital bed after cancer surgery. Or, just to provide an example that isn’t from Texas, there’s the 8-year-old kid from Vancouver, Washington, who raised thousands of dollars to pay off his classmates’ school lunch debt. Are we actually supposed to celebrate this? Why are these anecdotes cheerfully portrayed as acts of kindness when they’re actually tales of grim dystopia?

An especially grotesque example of this genre recently floated into my newsfeed from North Carolina. A recent post from the Chapel Hill-Carrboro City Schools Twitter account, purportedly celebrating “Random Acts of Kindness Day,” related the news of a public fourth-grade teacher whose students has written “notes of appreciation for folks at the Amazon Fulfillment Center in Mebane, where [the teacher] is also a full time 5:30 p.m.-3:30 a.m./Mon.-Fri. HR manager.” The tweet continued: “(You read that right!) How kind!”

One would hope that the person who briefly posted about this teacher’s terrible employment situation did so out of some ironic attempt to raise awareness of the plight of North Carolina’s schools. Sadly, it’s an obvious example of what my former ThinkProgress colleague and TNR contributor Jessica Goldstein has referred to as “the feel-good feel-bad story.” “In the feel-good feel-bad story,” she wrote in 2018, “irrefutable proof of an institutional failure is sold as a celebration of individual triumph,” for the purpose of distracting us from “the structures that made such kindness, bravery, and fortitude necessary in the first place.”

The tweet from the Chapel Hill school system perfectly fits the mold of a “feel-good feel-bad” story. The institutional failure is obvious: Apparently, it’s quite difficult to live in North Carolina on either the salary of a full-time fourth-grade teacher or a full-time human resources manager. It’s also not clear when this teacher actually sleeps between the two jobs, given the half-hour commute from Carrboro to Mebane, the inevitable commutes to and from home, and the time this teacher spends working outside of her contract hours, as most teachers in the United States do. But this institutional failure is obscured by a supposed individual triumph that is meant to be a reward in itself, as if the fulfillment this educator allegedly receives from always working and never sleeping is some form of compensation.

Whoever sent this tweet demonstrated at least enough self-awareness to delete it, not long after it started attracting attention. That’s probably for the best, because as one local blogger noted, it surfaced unflattering facts: “A new teacher in North Carolina with no experience makes $37,000 per year (10 months), with a modest bump if they have an advanced degree or certification. The annual salary increases on a regular basis up to teachers with 25 years of experience, who are paid $54,000.” One North Carolina school principal recently summed up their personnel predicament like so: “It is incredibly difficult to find anybody that wants to teach, certainly, anyone that meets the qualifications to be eligible to teach.”

This is a national problem. Teachers are paid substantially less than workers with similar educational credentials. According to a 2018 analysis, “Teachers’ weekly wages lag by more than 25 percent compared to similarly educated professionals in 16 states. There are no states where teacher pay is equal to or better than that of other college graduates.” According to a new analysis by the Economic Policy Institute, that gap has only worsened in the years since. It’s becoming more common for teachers to have to work second jobs or hold down a side hustle, and according to a recent story in EdWeek, “new analysis conservatively estimates that there are more than 36,500 teacher vacancies across the United States, and the majority of states are experiencing teacher shortages.”

And there are solutions that don’t require acts of quiet individual heroism or elaborate displays of appreciation. Vermont Senator Bernie Sanders has proposed a measure called the Pay Teachers Act, which will establish a salary floor of $60,000 for all public school teachers, to be funded by an adjustment to the estate tax that currently allows the wealthiest Americans from sheltering their income from taxation. To Sanders’s mind, “If we can provide over a trillion dollars in tax breaks to the top 1 percent and large corporations, please don’t tell me that we cannot afford to make sure that every teacher in America is paid at least $60,000 a year.”

Our current teacher workforce is hobbled by second jobs and side hustles, which scares off the most talented potential full-time teachers and sabotages our kids’ educations and futures. Perhaps the people on the right who spent the last few years screeching at top volume about “learning loss” might be convinced to lend a hand to Sanders’s effort, and then we can celebrate what would truly be a feel-good story.

The February 3 derailment of a Norfolk Southern train and the cinematic environmental disaster that followed has plunged a small Ohio town into chaos. The New Republic’s Prem Thakker spoke with several residents of East Palestine, Ohio, this week, who have told a fairly consistent tale of related woes: sudden and worrying health concerns to humans and pets alike, a lack of guidance from local officials, and paltry offers of compensation from the rail company. The story, as a whole, contains the elements of something truly scandalous—a disaster of Deepwater Horizon proportions. But along the way, accusations of a second scandal have emerged from some quarters, who have accused the media of giving the story short shrift.

Is the accusation fully fair? It may not seem obvious, but for us to know anything about the derailment, some media, somewhere, had to cover it in some way. The truth of the matter is that the story is getting robust coverage, especially where it matters: locally. As Joe Donatelli, the digital director of News 5 in Cleveland explained in a long thread on Twitter, “To say it’s not being covered at all is wrong if you know how to Google.” Cable news channels and major national dailies have also, if somewhat laggardly, covered the story; there’s been no “news blackouts” of the events in East Palestine. Nevertheless, it’s clear that there are obvious expectations among the broader population of news consumers that aren’t being met by the big legacy media outlets.

So what is it that makes sufficient media coverage sometimes seem insufficient? There are some boring reasons: East Coast media bias, as The New Republic’s Matt Ford noted, is real—and it’s an especially galling factor in coverage of the environment. It’s not hard to imagine the western wildfires receiving substantially better coverage if the news industry were centered in California. But the perceived shortfall can’t be entirely attributed to industry shortcomings. Some have to do with the facts on the ground.

We should be thankful that there is not a massive death toll (at least among humans) as a result of the derailment; we can also acknowledge that the lack of casualties makes the story less urgent to some newsroom leaders than, say, the recent mass shooting at Michigan State University. East Palestine’s emergency, moreover, will be slow to unfold. While we’re already getting a good sense that this train crash will have a dire environmental impact, the fuller picture those facts will ultimately present isn’t currently at hand. In fact, we may want to reserve judgment about how well the mainstream media covered this matter until a few weeks from now. When that fuller picture emerges, will the big leaguers still be willing to beat a drum?

The coverage of the derailment also suffered from the fact that cable news and the major newspapers were transfixed by a story that seemed, both at the time and in retrospect, much sillier: the Chinese spy balloon(s). But perhaps the biggest reason the derailment story hasn’t dominated the news cycle is that it lacks a clear and obvious partisan frame, and thus there’s no clean way to fit it into a tidy “left versus right” construct. The Deepwater Horizon disaster was a monumental story in part because its proximity to New Orleans inspired the media to ask if this was “Barack Obama’s Katrina.” With regard to the derailment, we don’t have clear partisan villainy: It’s a product of Republican-backed deregulation and austerity, the Biden-supported quashing of a rail workers’ strike, and years of bipartisan obeisance to shareholder capitalism that created incentives for firms like Norfolk Southern to lengthen their trains without adding upgraded safety measures.

That this failure has so many fathers also adds a level of complexity to confronting the powerful interests involved. There isn’t always a tremendous appetite for these kinds of confrontations at big legacy news organizations of the sort that, say, welcome Pentagon “message force multipliers” or uncritically print the accounts of cops as the first draft of a news story. From many thousands of feet in the air, perhaps the legacy media can see the balloons better, but they’re less attuned to the inequities at the root of these kinds of stories and have less of an understanding that “politics” can best be measured as a force that acts on ordinary people. There’s a reason that TNR’s Thakker was quicker to the punch in getting the straight dope from East Palestine locals than reporters at The New York Times or The Washington Post: We have fewer resources but a keener interest in that aspect of the story.

But there’s something genuinely gladdening to take away from this inquiry into the modern media. Those who’ve been left so vocally dissatisfied by the coverage of the Norfolk Southern disaster are demonstrating good instincts in terms of what should constitute substantive news coverage of the events that shape our lives. What’s more, they’re showing laudable character in their desire not to turn away from strangers in need. There’s no guarantee that there will be some widespread self-correction among the biggest media firms, but without this public consumer demand for a better brand of news, a better brand of news won’t be possible.

This article first appeared in Power Mad, a weekly TNR newsletter authored by deputy editor Jason Linkins. Sign up here.

Did The New Republic’s Walter Shapiro just jinx the entire country? It seems as if I was just savoring the afterglow of his recent piece extolling the relative quietude of the pre-presidential primary season when all of a sudden, everything popped off. Nikki Haley announced her intention to run for president. Mike Pompeo put a toe in the water. Then Donald Trump accused Ron DeSantis of being a pedophile. So much for our sea of tranquility!

Still, let’s face it, this was inevitable: The Republicans are going to have a long and pyrotechnic skirmish to decide their presidential nominee. For those hoping for a similar spectacle on the Democratic side, however, reality provides precious little grist. But the world of hot takes and hypotheticals beckons. And this week, we got a classic of the genre in the form of a Michelle Goldberg piece titled, “Biden’s a Great President. He Should Not Run Again,” in which she takes 850 words to reiterate a point she’s already made: Joe Biden is really, really old.

I don’t necessarily want to dump all over this point of view. I share Goldberg’s concern about Biden’s age. When The New Republic’s editor, Michael Tomasky, solicited the opinion of Democratic insiders about whether Biden should run again, it was among their worries as well. Their consensus, nevertheless, was that Biden should run again. It makes sense: Biden’s age was a major concern when he announced his run in 2015. It remained a major concern when Biden’s two biggest rivals in that primary, Elizabeth Warren and Bernie Sanders, also turned out to be very old themselves. Democratic elites and primary voters stared right into the heart of these gerontological anxieties and, having weighed them fully, decisively nixed all of the more youthful alternatives that were running for president alongside their elders. So here we are.

It’s true that Democrats could, if they wanted to, pivot and act on that concern now by using a primary to reverse this prior decision. One major problem they’d face is the lack of compelling alternatives. Democrats have a lot of people on hand whom voters already rejected in favor of Biden. Two of them, Sanders and Warren, don’t solve the age problem. Vice President Kamala Harris barely rated in the 2020 primary and has historic troubles with Democratic Party elites. Most of the rest have done little in the intervening time to advance the idea they should seek higher office, and the prospects for some have only worsened: Beto O’Rourke got absolutely rinsed in his latest attempt to get elected to something.

What about the future? Goldberg claims Democrats have “a deep bench.” She’s only able to name two politicians, Gretchen Whitmer and Raphael Warnock. Take it from someone who watched the Virginia men’s basketball team crash into—and out of—the NIT last year: Two people is not enough for a “deep bench.” Whitmer is one of a few Democrats (I’ll spot Goldberg J.B. Pritzker and Josh Shapiro) who might well round into presidential form, given another few years of seasoning. The notion that Warnock should make an early departure from his hard-won Georgia Senate seat—especially after all he went through to secure it—to take on a quixotic bid for the White House in 2024 is one of the more ludicrous notions I’ve encountered in a while.

Besides, any attempt to solve the dilemma of Biden’s age by seeking a replacement will engender a problem of greater magnitude: It will inject the pre-primary season with a massive dose of unnecessary tumult. Even if Biden had to give way for a clear and obvious reason, the ensuing disarray would touch off a combative primary in an election cycle in which a unified purpose among Democrats couldn’t be more important.

And the pundits who’d sell such a switch as a brilliant tactical decision, as Goldberg has, can’t be counted on to ratify the wisdom of their directive after the fact. Remember: The political media are chaos junkies who treat conflict as catnip and would relish the crisis caused by Biden’s departure. Meanwhile, the lesson of the midterms is that voters are turned off by disarray. Biden’s own polling struggles reflect this: Nothing damaged his approval ratings more than the chaotic withdrawal from Afghanistan. He is still struggling to recover from that one moment when it did not appear that the adults were in charge.

But Afghanistan is instructive in a different way as well. The withdrawal may have hurt Biden’s numbers, but the fact that he was unwilling to keep paying the sunk costs of the Afghanistan scam was a real break from the status quo. Biden’s State of the Union address suggested that the president still has that yen for fresh thinking. As HuffPost’s Kevin Robillard noted: Clinton used his address “to declare the era of big government over, Obama used them to sell a grand bargain and a free trade deal.” Biden, by contrast, “used it to attack big pharma, rule out social security cuts, talk about antitrust policy, and declare the tax code unfair.”

This is a phenomenon that we’ve noted before: Many of Biden’s throwback instincts about the way America could be are incredibly well suited to the moment, and seem fresher than his predecessors’ ideas. Would-be Biden successors should take heed, because at the moment it’s Biden who sounds most like a bona fide party standard-bearer and a better tribune of the middle class than any of the GOP’s weird culture warriors, and more prepared to battle the larger universe of chiselers and cheats who have gotten away with nickel-and-diming ordinary Americans.

This article first appeared in Power Mad, a weekly TNR newsletter authored by deputy editor Jason Linkins. Sign up here.

Days of relative calm were few and far between during President Trump’s chaotic reign, but there was one matter about which no one had to fret: For four years, whenever the debt ceiling needed to be raised, Congress made it happen in a fuss-free manner and without worrisome talk about the catastrophic economic impacts of a debt limit breach. But with Republicans in charge of the House of Representatives, the bad old days are here again. On Wednesday, President Biden and House Speaker Kevin McCarthy commenced budget negotiations with a debt limit “X Day” looming.

As CNN reported, Wednesday’s talks were something of a nonevent—precisely what political wags anticipated in the run-up to the meeting. McCarthy emerged from the White House confab with optimistic lines about the potential for common ground. Good news, then: We did not meaningfully lurch in the direction of doomsday this week. But there’s a palpable sense of déjà vu as we tee up what might be this year’s most loaded question for the Biden administration: Will the president keep his vow not to negotiate over the debt limit?

Biden, as vice president in the Obama administration, had a hand in creating the debt limit chaos by deciding in 2011 to seek a “grand bargain” with Republican lawmakers on deficits and long-term spending. Thus began an era in which the two parties were perpetually at an impasse over spending and revenue: a divide so obviously unbridgeable that connecting it to the debt limit only added to the potential for destruction. Still, the Obama White House spun its wheels, chasing a grand bargain through several standoffs, a government shutdown, a credit downgrade, and the sequestration budget cuts that went into effect after Congress’s “supercommittee” failed on its own terms to arrive at a shared set of budget cuts.

This troublesome past is now the ready-made prologue to Biden’s new wranglings with new Republicans. As NBC News’s Sahil Kapur reported last week, when Obama and Biden came to understand the folly of their ways, they made a pledge never to repeat their mistakes, agreeing that from then on “nobody can use the threat of default or not increasing the debt limit as a negotiating tool.”

The early signs are encouraging. Last Thursday, Biden said, “I will not let anyone use the full faith and credit of the United States as a bargaining chip.” The administration echoed that stance in a memo released Monday from National Economic Council Director Brian Deese (who on Thursday announced he was stepping down from that position) and Office of Management and Budget Director Shalanda Young. In it, the two economic advisers said that the president “intends to pose two questions to McCarthy on Wednesday when the two men meet: Whether McCarthy will commit to the U.S. not defaulting on its financial obligations and when McCarthy and House Republicans will release their budget.”

For what it’s worth, Republicans have seemed a little knocked back by the White House’s steadfastness. As Kapur reported in a previous dispatch, Republicans have been “struggling to identify” what to cut and “divided” over whether “Medicare and Social Security spending should be on the chopping block” or “military funding should be on the table.” According to The New York Times, these “internal divisions over how to reduce spending” have since spilled “into public view, underscoring the political challenge that Republicans face as they try to wield the specter of a default to extract concessions.”

If Politico’s reporting is any guide, this is more or less going the exact way the White House drew it up. “The White House strategy,” according to Playbook, “is patience.” The administration is of the belief that “McCarthy is unlikely to craft a budget plan that can secure 218 votes given the internal contradictions within his conference among libertarians, defense hawks, and moderates representing Biden districts.”

Still, it’s in this early stage that it’s easiest for Biden to keep his debt ceiling vow. It’s only going to get harder. With a new analysis from the International Monetary Fund pointing to the easing of inflationary pressures and a global economic rebound, there are going to be tremendous incentives for Republicans to crash the economy as the presidential election cycle gets underway. Push could come to shove, and Biden might have to reach for a parliamentary trick—or, yes, a platinum coin—to avert disaster. But that’s why these tools are at his disposal: to help Biden keep his promise, and keep the world spinning forward.

This article first appeared in Power Mad, a weekly TNR newsletter authored by deputy editor Jason Linkins. Sign up here.

You’ll never guess what’s gotten stuck in the craw of the perpetually bothered GOP doyenne Peggy Noonan. This past weekend, the Wall Street Journal columnist took to the paper’s doughty op-ed page to sound off on George Santos, the human falsehood fountain who now serves New York’s 3rd congressional district. In a column titled “George Santos Has Got to Go,” Noonan says that she doesn’t “get why members of Congress would let the George Santos story” drag on. “It diminishes them,” she writes. “It is both a daily insult to the American people and a taunt.” She joins a boomlet of conservatives, from within and without New York, who’ve called for Santos’s exit in recent days.

As The New Republic’s Alex Shephard recently wrote, Santos actually does bring something to the table: His daily cascade of lies and humiliations provides the GOP with a much-needed distraction. Every day, his peccadilloes hit the headlines, pushing down discussion of, say, the crazy “fair tax” on which Republicans are going to vote. Perhaps Noonan and her fellow critics do not share this visionary strategy. But they’re also lacking in perspective. It is said that Santos wanted to find a way to receive lifetime health care coverage and a pension. These aren’t unreasonable things to want. It’s further said that he eyed becoming a member of Congress to get these perks, which is also quite reasonable. And then he arrived at the most reasonable conclusion of all: Where would an inveterate liar and con man be most welcomed in politics? The clear answer was the Republican Party.

Anytime a conservative gets on their high horse about Santos, the derelict lawmaker ends up looking more sinned against than sinning—and not just because it’s clear that plenty of Republicans knew what Santos was all about. Noonan says that Santos “waged war on reality”? Hard to imagine that he wouldn’t be welcome in the party that popularized this practice in numerous ways, rejecting the fruits of science and academia and turning its base against these professions. Noonan complains that Santos has “stolen from voters … a sense of what’s true.” That’s rather rich coming from someone who touts the party that lied the nation into a destructive war.

“The only entity that smoked out a fake was a small local newspaper, The North Shore Leader,” writes Noonan, seemingly unaware of the long war her party has waged to discredit the press, a project that accelerated after Newt Gingrich’s ascension. Does anyone imagine that the GOP is going to play a role in reassembling a robust, adversarial press in the numerous news deserts that have bloomed across the country? Like everything George Santos says, it is not to be believed.

Noonan’s far from the only Republican celebrity who needs to get off the fainting couch and take a look in the mirror instead. Former House Speaker Paul Ryan recently accused Santos of being a “fraudulent candidate” who “hoaxed his viewers.” It’s an interesting take! Here’s a fun fact about Paul Ryan, though: During the 2012 presidential campaign, Ryan staged a fake photo op at a Youngstown, Ohio, soup kitchen, where he pretended to wash some already-washed dishes long after everyone had already gone home. (Another interesting fact is that after Ryan’s ruse was exposed, his supporters took it out on the soup kitchen.) Maybe he’s not in the strongest position to be chiming in on the matter of George Santos.

Was Santos really so wrong to imagine that he wouldn’t be welcomed into the Republican Party with open arms? The GOP has a rich tradition of scams and flimflam, so much so that not only can you easily see how the road got paved for a celebrated con artist in the form of Donald Trump to become the standard-bearer of the party of Paul Ryan, but you can also surmise that Trump is insignificant to this larger and long-standing tendency within the contemporary Republican Party. In 2012, The Baffler’s Rick Perlstein spelunked into the depths of the conservative movement’s grift-industrial complex, chronicling how direct-mail titan Richard Viguerie unleashed the floodgates for a million get-rich-quick schemes and snake oil testimonials to find their way into their supporters’ mailboxes, the better to shake them down for whatever loose change could be prised from their pockets. Writing for The New Republic, Jeet Heer explained how the GOP’s anti-intellectual bent softened the brains of its base, making them more susceptible to the waterfall of bunkum that routinely comprises the whole of the Republican rhetoric.

The big swindle never stopped. From penny stock scams to pump-and-dump schemes to fake medical cures, the Republican Party has become associated with treating its own voters like rubes and fleecing them to the hilt. Just this week, Talking Points Memo’s Hunter Walker reported that the people who formed the “People’s Convoy”—the aborted effort of truckers to encircle the District of Columbia in protest of various Covid-19 public health mandates—have seamlessly transformed themselves into a multilevel marketing scheme. And why not? Betsy DeVos surveys her domain from atop a mountain of Amway funny money. What’s good for the goose is good for the gander.

At any rate, while various conservatives pile up the hypocrisies because they’re angry at George Santos for getting caught, I have a good feeling he’s going to stick around for a while. The new GOP House majority has slim margins and its poor bedraggled leader, Kevin McCarthy, is going to need every vote he can get, up to and including that of Santos. Frankly, I don’t think Santos played his hand too badly, and given time, perhaps he might form the same strong bonds with McCarthy that the speaker has forged with Marjorie Taylor Greene, who believes that the California wildfires were caused by Jewish space lasers.

This article first appeared in Power Mad, a weekly TNR newsletter authored by deputy editor Jason Linkins. Sign up here.

As President Biden enters his next and final presidential election cycle, there can be little doubt that his best argument for reelection is that he put a wayward nation right after four years of Trumpian misrule. There will be contrasts that Biden will surely want to tout, from job numbers and legislative accomplishments to his superior tone and temperament. But a recent delivery from the “Be Careful What You Wish For” store has drawn him into a less favorable comparison with Trump.

There are early indications that Biden’s mishandling of classified documents is rooted in error rather than corruption or egomania. Unlike Trump, Biden did not spend a lengthy period of time intransigently blowing off authorities, forcing them to carry out a search and seizure of his property; his team immediately fessed up and handed over the documents to the National Archives. But thanks to the appointment of a special counsel to investigate the matter and a second discovery of classified documents that was handled less forthrightly, the flap has offered the GOP and its media organs enough meat to ensure this matter won’t be pleasantly resolved.

CNN summed up the White House’s strategy like so: “Pledge full cooperation. Attack House Republicans. Don’t engage in the details of an ongoing matter,” the idea being that “pushing ahead with their regularly scheduled programming” is the best course of action. But as The Washington Post subsequently reported on Wednesday evening, things didn’t go to plan, and the administration earned itself a furor by not picking the right moments to be as transparent as possible.

That the White House prefers a low-key approach is understandable—unlike Trump, most presidents don’t try to inject themselves into the news cycle every hour of the day. But I think it’s an error. What Biden is facing is a test of mettle, not a pitfall to dodge. Rather than play this matter down, Biden should—within the limitations that are wisely enforced during an ongoing investigation—endeavor to play it up, instead. He should own whatever mistakes led to these classified documents ending up where they shouldn’t have. This is an opportunity to make government ethics great again, and it’s long overdue.

One of the more important jobs a president has is setting an ethical standard for his administration. We don’t have ethics cops walking the beat and making arrests; there’s no enforcement mechanism other than the tone set from the guy at the top. When this is absent, as we saw during the Trump administration, things unwind quickly—the entire Republican National Convention ends up being a massive violation of the Hatch Act. A post-Trump restoration couldn’t be more vital: New norms get established quickly in Washington. They also erode fast. So Biden should sail over the low bar set by his predecessor by detailing the errors that led to the misplacement of these classified materials and making clear what’s being done to ensure the mistake won’t be repeated.

Why is this important? While Biden and his fellow Democrats can’t do much in the way of passing laws with the GOP in control of the House, they can still spend the next two years setting an example. Collectively, everyone on the team should be seeking out opportunities to play Gallant to the Republicans’ weird Goofus impulses. But it’s also important for Biden to burnish his credibility with the American people—and maybe be a direly needed change agent in our all-too-tatty political culture. Washington, a notoriously cynical place, is famous for its common sense–crippling ideas about leadership. Perhaps one of the most notorious is the odd standard that holds that publicly admitting errors is a sign of weakness and that politicians should go to comical lengths to avoid doing so.

There’s another way: In Bailout, Neil Barofsky’s memoir of his time in Washington serving as the special inspector general overseeing the Troubled Asset Relief Program, he described the advice he received from Kristine Belisle, the woman he smartly hired to be his communications director. It was about as anti-Washington as it can get: “We’ll admit and even highlight our mistakes.” As she went on to explain, there’s method in a strategy that most people inside the Beltway would deem madness:

This is the best way to earn the press’s trust. They’ll know we’re not spinning like everyone else. SIGTARP will quickly become the only credible source for information in Washington about TARP. We might be embarrassed at times and disclose things that we could—and others would—easily hide, but we’ll shock the press with our honesty. No one else does this, and before long, we’ll have a built in defense when we’re attacked. No matter what they hear, the press will come to us first and believe us, because we’ll prove to them that we tell the truth.

This is perhaps the biggest reason for Biden to pursue the course of radical responsibility-taking: Moments inevitably arise in any presidency when having the trust of the public and the institutions that safeguard the civic interest is critical. Moreover, there is vital capital to be earned by owning our mistakes, and there’s an important distinction that Biden can draw with his political opponents. The president would do well to follow the old adage: Tell the truth—and shame the devil.

You have to give some credit to the new Republican House majority: The first week of their new reign was hilarious. Between several days of watching Kevin McCarthy get subjected to ritual humiliation and New York Congressman George Santos’s total commitment to ensuring that not a day would pass without fresh “revelations” about his haphazardly constructed lies, this has been a period of peak content. While it may have been possible for Democrats, like Katie Porter, to practice “the subtle art of not giving a fuck” during this period, I’m sorry to say that the time for chortling is over—and the fuckery that the GOP’s House majority has planned will be anything but subtle. 

Already there’s been a lot of hot talk about Star Chamber–style investigations and possible impeachments. The House is in session, in chaos, and there’s not much to be done about it until the next election. But there’s one concern that stands out: the likelihood that the GOP will drag the country to the brink of a debt default, and perhaps even push us over the edge. I know, I know: How many times are we going to go through this? The Democrats had a chance to disarm this ticking time bomb during the lame-duck session but chose not to. Now it’s essentially understood that the threat of a debt limit default is back for the duration. 

Well, we can live with the constant fear of a GOP-precipitated debt default for the next year if we want, in the hopes that cooler heads will prevail and cobble together some sort of short-term compromise that might tide the global economy over until the next deadline. Or we can do what we should have done a long time ago: have the president command the U.S. Treasury to mint a magic trillion-dollar platinum coin, stash it in the Treasury, and end the danger once and for all.

I know what a lot of dull-witted pundits are going to say about this proposal: You can’t just mint a magic coin, it’s a total gimmick, this is crazy talk. You want to know what’s really crazy? Agreeing to remain the secretary of the treasury during a period of time when the House of Representatives’ primo nutters have made it their cause célèbre to regularly threaten to tank the global economy. But just this week, Bloomberg News reported that Treasury Secretary Janet Yellen—who herself has called the platinum coin a “gimmick”—will remain in the role for “the duration.” If she wants to survive, let alone enjoy her tenure, she should tell Joe Biden that she’s ready to mint the coin. Honestly, I’d question the judgment of any treasury secretary who wouldn’t do so, given the sadomasochistic alternative of grimly enduring an escalating series of economic nightmare scenarios.  

In politics, conflict and complications are inevitable. Simple solutions are in short supply. And we all have a tendency to overthink things. It was, in fact, “overthinking things” that got us into this mess: During the “Grand Bargain” phase of his presidency, Barack Obama thought it would be a great idea to use the occasion of raising the debt ceiling as a moment to enter into larger negotiations on debt reduction. Obama just threw open Pandora’s box, enabled the GOP’s plunge into debt-limit psychosis, and we’ve been struggling to get unfucked ever since.

It was also, not coincidentally, during Obama’s first term that the idea of minting a trillion-dollar coin—which appears to be an entirely legal cheat code, thanks to a few sentences in a 1996 law—first arose. Now Biden, who had a front-row seat to Obama’s massive cock-up, can end this grievous era of totally overthinking it. By embracing the kind of mentality that Alexander the Great deployed when he was faced with the Gordian knot, or which Indiana Jones turned to when challenged by a scimitar-spinning fool who failed to observe that he was carrying a loaded pistol, Biden can write his name alongside these legends. He can reach for the quickest solution to the debt ceiling fiasco and secure Dark Brandon’s place in history by minting the coin.

The main criticism against minting the coin appears to be that it might worsen inflation. But the truth is, no one knows because we’ve never tried it—and certainly defaulting on the nation’s debt would have more immediate and drastic economic consequences than minting a coin and stashing it away. The idea may seem absurd on its face, but as Zachary Carter argued back in 2021, the real absurdity is the debt ceiling itself. There’s a beautiful symmetry about thwarting the ridiculous problem it poses with an equally ridiculous solution.