Macroeconomic Consequences of The Upcoming Election
We all know that elections have consequences and the upcoming one is no exception. Whoever between Trump and Biden wins in November will have major ramifications for the US and the world. Moody Analytics released a study on the macroeconomic implications of the election, theorizing out what a win for Biden or Trump would mean for the economy. In short, it can’t be more different.
Essentially, Moody looked at four different scenarios: A Democrat Sweep, A Democrat President + a Split Congress, A Republican Sweep and A Republican President + a Split Congress
While I admit that Moody is being very pragmatic in their possibility of each scenario, the fact that there is 35% chance of a Republican Sweep gives me nightmares after all that the current Administration and Congress have done for the past few years, especially in the fight against Coronavirus. Nonetheless, what would each scenario mean for the economy?
The implications can’t be clearer: a Democratic Sweep, according to Moody, would be the best scenario for employment and the economy, and for lower & middle-income households.
Lower- and middle-income households benefit more from Biden’s policies than Trump’s. Biden ramps up government spending on education, healthcare and other social programs, the benefits of which largely go to those in the bottom half of the income distribution. Meanwhile, he mean- ingfully increases taxes on the well-to-do, financial institutions and businesses to help pay for it. Trump largely does the reverse. He makes permanent the temporary tax cuts he implemented in his first term. The benefits largely go to higher-income house- holds and businesses, while government spending is scaled back on healthcare and a range of social programs, the benefits of which go mainly to those with lesser in- comes and wealth.
Source: Moody
To be clear, no-one would know for certainty what would happen in the next few years. Regardless, it’s undeniable that the economy as well as the federal budget improved under Democratic Presidents in the last 20-30 years such as Clinton and Obama, while contracting and slumping under Republican Leaders like Bush and Trump. In the case of Trump, his presidency is hit by a once-in-a-lifetime pandemic, but when you are at the helm, you have to take the responsibility. The power of the President is massive, yet when you compare the US to other developed countries, it lags far behind in the fight against Coronavirus. Plus, I believe his “America First” rhetoric, coupled with the careless use of tariffs, and a tax cut that significantly lowers tax revenue for the government are more harmful than helpful to the American people.
One can argue that policies take a long time to take effect and the results under Democratic Presidents came from Republican policies. If that were true, then whatever economic gains or glowing numbers that the government likes to boast about would have to come from Obama’s actions.
It comes down to this: if you are inclined to believe in research from organizations with credibility in the financial intelligence & analytics world, have a read of the paper to be more informed before the election. If that’s not your cup of tea, if you believe more in what the administration or Fox News hosts say, then by all means.
It’s just so shocking to me that so many folks can vote against their own interests.
Rage by Bob Woodward
I picked up the book from a recommendation on Twitter. Bob Woodward is a veteran journalist that has covered 9 presidents, reported originally on the Watergate scandal and garnered much respect & credibility in the journalism and politics world. For reasons unknown to even Bob, he managed to secure 17 on-the-record interviews with Trump. This book mainly contains what went on in those interviews. Throughout the book, Bob took audience on the journey throughout the major milestones in Trump’s presidency with his relentless reporting and correspondence with Trump himself. His interviews helped readers understand more about Trump, about how he thought and came to make major decisions such as policies during the pandemic or strategic allies with South Korea, about how erratic Trump is and about how the folks around him really thought about him.
I am not a big fan of Trump, to put it extremely lightly, but I have to give him credit for agreeing to sit down with a journalist on the record for 17 interviews while knowing that the book would not be kind on him. Personally, I don’t know if I could do it. Normally, books like this one are criticized to be extreme biased either against or in favor of the President. I’d say that this book is pretty fair because most of the content of the book actually came out from Trump’s mouth and could be easily verified. If you look for a weekend read, try this one.
“What the hell is going on?” Coats asked in a private sidebar conversation with Mattis after one session. In just one example, Trump wanted to withdraw U.S. troops from Afghanistan and South Korea. There was a rush. Instantly. “Get them out!” Trump had commanded.
“That’s crazy,” Mattis said to Coats. “That’s dangerous.”
Coats was troubled by the absence of a plan or a consideration of the human dimension—the impact on the troops, the allies, the world—or a sense of the weight of the office.
“The president has no moral compass,” Mattis replied. The bluntness should have shocked Coats, but he’d arrived at his own hard truths about the most powerful man in the world. “True,” Coats agreed. “To him, a lie is not a lie. It’s just what he thinks. He doesn’t know the difference between the truth and a lie.”
Excerpt From: Bob Woodward;. “Rage.”
Then Trump digressed to reveal something extraordinary—a secret new weapons system. “I have built a nuclear—a weapons system that nobody’s ever had in this country before. We have stuff that you haven’t even seen or heard about. We have stuff that Putin and Xi have never heard about before. There’s nobody—what we have is incredible.”
Later I found sources who confirmed the U.S. military had a secret new weapons system but no one wanted to provide details and were surprised Trump had disclosed it. Trump had asked for and received massive funding increases for the National Nuclear Security Administration, which maintains the nuclear weapons stockpile, since taking office.
Excerpt From: Bob Woodward;. “Rage.”
By early 2020, Kushner thought Trump had assembled a better and more dedicated White House team than they’d had before.
“In the beginning,” Kushner told others, referring to the first years of the administration, “20 percent of the people we had thought Trump was saving the world, and 80 percent thought they were saving the world from Trump. Now, I think we have the inverse. I think 80 of the people working for him think that he’s saving the world, and 20 percent—maybe less now—think they’re saving the world from Trump.”
Let that analysis sink in: Twenty percent of the president’s staff think they are “saving the world” from the president.”…
“In meetings, Kushner said, Trump was “an expert at cross-examination. He’s an expert at reading people’s tells. He won’t say, let me go with a nuanced position. He’ll, in a meeting, say, well, what if we do 100? They’ll say, oh, you can’t do that. And then, he’ll say, well, what if we do zero? It’s like, holy shit. It’s whiplash. So that’s his way of reading people, is to see how certain are they of their position: Do they hold their ground? Do they buckle? So that’s just his style.
“And by the way,” Kushner added, “that’s why the most dangerous people around the president are overconfident idiots.” It was apparently a reference to Mattis, Tillerson and former White House economic adviser Gary Cohn. All had left. “If you look at the evolution over time, we’ve gotten rid of a lot of the overconfident idiots. And now he’s got a lot more thoughtful people who kind of know their place and know what to do.”
Excerpt From: Bob Woodward;. “Rage.” Apple Books.
Long Way Up Documentary on Apple TV+
This documentary chronicles the road trip by Ewan McGregor and his friend Charlie from the tip of South America to California in the span of three months. What makes this trip special is that they used electric motorcycles entirely and that the trucks that followed to support them when critical were also electric. In “Long Way Up”, audience will see how the two friends and their team prepared for the challenge, including working with a company to build two prototype electric trucks & with Harley Davidson to build completely new untested electric motorcycles, learning Spanish at the last minute and most importantly planning how to charge the bikes all the way. There have been only three episodes released so far, but I am completely hooked. With the effort by Ewan, Charlie and their team to achieve such a monumental task. With the natural beauty of South America and how little I know about it. With the immense possibility of what humans can do.
Minh Quang Duong 