This article is an on-site version of our Swamp Notes newsletter. Sign up here to get the newsletter sent straight to your inbox every Monday and Friday
On Tuesday, President Joe Biden will give the annual State of the Union address. This speech is always well covered for obvious reasons, but it tends to be a grab bag of bullet points from all the interest groups and individuals that the political party in charge must cater to. In this case: Planned Parenthood, check; labour unions, check; environmental NGOs, etc, and so on. This is why nobody ever remembers SOTUs. They are a political laundry list, not a narrative.
But this time round, there’s an opportunity for the president to do something different. The administration wants to make the next two years about explaining the big shifts that it’s been trying to make in the US economy. What is “work not wealth” really? How will friend-shoring work? Is the post-neoliberal world going to be a better one? And why should government have a bigger place in our society over the next 50 years than it has in the past half century?
Answering these questions requires telling people what this administration is trying to do at a 35,000 foot level, why it will work, and what evidence there is to support that thesis. It requires building a narrative, as my friend Felicia Wong, the president and chief executive of the left-leaning Roosevelt Institute, pointed out to me recently in a conversation about what this year’s SOTU might portend. “Everyone has their bullet points, but Biden needs to tell a story that aims higher and helps people really focus on the transformative moment that we are in.” Her suggested tagline for the speech is “invest in people and places”. (For more of her thoughts on what Biden should say, see this piece in Washington Monthly.)
Certainly, that’s what the president has done, putting an emphasis on the care economy, community colleges, student debt relief, union labour and the burgeoning field of place-based economics, which aims to show that traditional economic models that assume growth happens in the same way no matter where you live are wrong. (For a summary of how all these ideas hang together, have a look at the FT Economists Exchange I did a while back with Council of Economic Advisers member Heather Boushey, or a conversation I had with outgoing National Economic Council director Brian Deese at the Atlantic Council).
The best proof that government in general and fiscal stimulus in particular have a larger role to play is the success of the American Rescue Plan, which created a cash cushion for individuals throughout the coronavirus pandemic that left the US economy in a better place than many other nations. This bailout of consumers, rather than companies, stands in sharp relief to the policy approach taken during the 2008 crisis.
So, how should the president frame his message? I’d say it should go something like this: “For half a century, American politicians on both sides of the aisle thought that what was good for General Motors — or Microsoft or Apple or Google or JPMorgan or Pfizer — was good for America. But that wasn’t always true. The fortunes of companies and that of our country began to diverge in the 1980s, and that divergence has grown sharper over the past 20 years.
“But a global pandemic and a war in Ukraine have shown us that we do need government. It’s not the problem — for the past several years, it’s been the solution, helping citizens cope with everything from a virus to a recession. Now, government needs to bring companies and workers together to craft a new social compact. We live in a world that will be more regional, and even local. We will still need allies, and we will still engage in the world, supporting democracy, working together to fix the climate, and keeping crucial trade routes safe. But we also need to make sure that markets don’t run ahead of Main Street. We need to make sure wealth is spread across all communities, not just big cities. And we need — as a nation — to focus more on what we can do, and less on what we can buy. It’s time to invest in ourselves and those who share our values. We have to make sure markets work properly for everyone, and jobs don’t require crippling debt. We need to support makers rather than takers.” Or something like that.
Richard, what do you think? If you had some SOTU advice for the president, what would it be? And does anyone on the west coast listen to these speeches, or is it more for those of us in the Acela corridor?
I’m loving the whole movement to cancel meetings. Eighty per cent of them are a total waste of time, and nearly all of them are too long.
FT reporters Sam Fleming, Alice Hancock and Javier Espinoza have a smart deep dive on how Europe is responding to America’s Inflation Reduction Act, and what’s at stake for the continent.
In The New York Times, this front-page piece on a black exodus out of NYC (and often to the south) takes a close look at a trend that I think will reshape both the city and the politics of the nation as a whole.
Richard Waters responds
Rana, I’m impressed by the taste in sci-fi movies you showed last week, it’s more sophisticated than mine. I’m a sucker for anything that begins with a crew on a long mission to deep space and something going wrong. Sample scene: Noomi Rapace in Prometheus going into a surgery pod to have an alien removed by C-section (yes, it’s as gruesome as it sounds).
On to happier thoughts. I’m not sure we over here on the West Coast have a higher or lower tolerance for political grandstanding of the sort practised in the State of the Union, but I’d love it if the president tried something different. How about:
“This year, rather than the usual endless smorgasbord of legislative possibilities, I thought I’d grade myself on what I said 12 months ago. First, the positives. I was talking six days after Russia invaded Ukraine, and I told you how I’d built a coalition in the West against the aggression. But the economic sanctions we passed and legal actions against oligarchs haven’t done as much as I hoped to bring Russia to its knees. I’ll take 8/10.”
“I think I deserve the same for the CHIPS Act. The commerce department hasn’t yet got around to doling out the $53bn, much of it to help build new chip plants. when it does, people will realise that amount, spread over five years, won’t go far when you’re trying to build a modern tech manufacturing base, but it’s definitely something.”
“Inflation was raging and I claimed one solution would be to make more stuff in America. I admit now that was a specious argument, but inflation is going down anyway so I’ll take the victory lap. Some of our plans to promote domestic manufacturing didn’t work out but the Inflation Reduction Act (true, not much to do with inflation) has galvanised investment in low-carbon technologies. I see from the Financial Times that Europeans are panicking about how much investment we’re drawing away. 9/10.”
“Admittedly, quite a few plans I told you about didn’t get through, from lowering childcare costs to making sure everyone gets paid leave to universal background checks for gun purchases (though we did pass the first major gun safety law in nearly 30 years). All in all, we’ve done a lot for infrastructure and manufacturing but not so much for American families.”
“I think this year I need to go much stronger on economic and social justice, particularly with the police killing of Tyre Nichols still fresh in the mind. We are finally putting the pandemic behind us and the economy is headed for a soft landing: Let’s make sure we lift up all Americans, starting with families struggling for get a stronger foothold on the economic ladder.”
Edward Luce is on book leave and will return in mid-February.
We’d love to hear from you. You can email the team on firstname.lastname@example.org. We may feature an excerpt of your response in the next newsletter