Trump Wants To Make A Deal With President-Elect Biden

 

The Sound Of Music by Nancy Ohanian

I always just mention it in random posts but for the last couple of months I've been saying that Trump, who fancies himself the master deal maker, knew he wasn't going to win a second term and that all his threats and bluster and carrying on are just part of a pre-negotiation strategy. No one knows better than Trump what crimes he's committed. And he doesn't want to end up in prison-- and probably doesn't want his family to either, though I doubt he cares that much about most of them.

It must have chilled him to the bone during the campaign when Biden vowed to not pardon him. That's the context for all the bullshit about not peacefully leaving the White House the way Herbert Hoover, Jimmy Carter, Jerry Ford and George H.W. Bush did when they lost their reelection bids. Or most of it-- there's also the megalomania, authoritarian and narcissistic personality disorders, but that's a separate story. Trump would think nothing about the historical consequences of starting a Civil War to keep himself out of prison. Biden is taking over a profoundly sick country-- the worst COVID situation in the world-- by far-- a deeply divided country, each side irreconcilably antagonistic to the other, and an economy on the brink of Depression. He will be pulled in opposite directions no matter what he wants to do and has a divided Congress that won't let him do anything anyway. Trump can make it much worse. Yesterday, stocks went up a lot at the prospect of a gridlocked and incapable government. Good for people who gamble in the market, but not for the working class or even for the economy.

Late yesterday, Heather Long did a piece for the Washington Post, What a contested race means for the economy-- and your wallet. She noted that today, the FED "will hold a news conference [and] is widely expected to keep interest rates near zero for years, which should continue to make it attractive for relatively well off Americans to keep buying stocks and homes. The uncertainty could even push the Fed to attempt more of its own stimulus for the economy. But it’s a much more pessimistic outlook for jobs, which are barely half-recovered. Hiring has been slowing, and the latest Labor Department jobs report that comes out Friday is expected to show more loss in momentum for job growth. More than 22 million people remain on unemployment, a figure that has fallen little since the summer. Jobless benefits have been scaled back sharply for the unemployed. Measures aimed to help those facing student loan debt and evictions are set to expire at the end of the year. The struggles are growing for millions unable to get back to work."

McConnell will have every incentive in the world to do everything in his power to sabotage anything Biden tries to do to address the country's problems. Here's where Trump comes in:

The future of the economy-- and to some extent markets-- depends heavily on three key questions, many analysts say: What happens with the virus and stimulus; How quickly Americans start spending again on services like travel, restaurants and entertainment; And whether the hotly contested election sparks social unrest.

If the political situation triggers more social unrest, that could have long-lasting consequences for the nation and economy, weighing on consumer spending and potentially hurting businesses, especially restaurants and stores in downturn areas. In preparation for this election, stores across the country boarded up in anticipation of marches and protests that could turn ugly, and companies like United Airlines moved their flight crews out of hotels in urban areas.

The United States is “even more divided than it was in 2016,” said Peter Atwater, founder of Financial Insyghts and a professor at the College of William & Mary. “The conditions are ripe for outrage.”

The U.S. economy still depends heavily on consumer spending. That’s already heavily depressed because of the coronavirus, but protests and, especially, rioting would probably dampen it even further.

The biggest problem for the economy for months now has been the deadly coronavirus. It remains far from under control, and Americans are staying home and spending only a fraction of what they used to in the pre-covid era. Until that changes, the service sector will remain anemic and the recovery is likely to stall, said Constance Hunter, chief economist at KPMG.

“Until we get a handle on the virus, the economy will remain in a world of hurt,” Hunter said.

Hunter points out that spending on services typically makes up more than 45 percent of economic growth. But in the third quarter — when the United States saw a big rebound-- spending on services like restaurants, travel and entertainment remained sluggish, at below 43 percent of economic growth. That might not sound like a big difference, but it amounted to over $500 billion less flowing through the economy in the third quarter of 2020 versus the same period last year.]

There’s hope that if the virus gets under control, there will be a flood of spending again, but businesses have to survive until that point. Small businesses, in particular, are on edge. It’s unclear if that rebound will happen summer 2021 or much later than that.

What’s shaping up for the economy and markets was perhaps best summarized by JPMorgan in a note Wednesday morning: It’s “unclear on the next President but fairly clear that he’ll face Congressional resistance on anything transformational, whether on the budgetary or regulatory front.”

The gridlock might be good for markets and investors. But a lot of pain remains for small business owners and the unemployed. For them, much is still highly uncertain.

Trump can't do anything to help matters, except by not making them drastically worse, which he can do. And which he wouldn't hesitate to do if he thinks it will protect him from Justice.

Trump's Wrong Decisions Are Bringing On A Depression

Trump claims he inherited a lousy economy from Obama and made it the best economy in the world. That's a double lie-- Trump inherited a very decent economy from Obama and it kept improving until Trump tried skewering it further for the rich at the expense of the working poor-- and by the time Trump made every wrong decision about confronting the pandemic, a recession was baked into the cake. Will voters understand this? Probably enough of them will.

I guess you know there are two economies right now-- one for the labor force that's in a deep recession, likely a depression, and one the management class and people living on passive income-- wealthier people-- that just keeps growing, thanks to the Fed pumping money into the financial markets and to their unlimited ability to print money. Yesterday Wall Street soared again-- up xx points. No one ever mentions that only 5 stocks on the S&P 500 are doing all the work and the other 495 stocks are all down by an average of 3%. (Pam and Russ Martens at Wall Street on Parade added another unsettling aspect yesterday: An Unprecedented 1,640 CEOs Departed in 2019; Now Execs Are Dumping Stock at Highest Pace Since 2006. "The number of CEOs that did not leave on their own accord last year was 101 out of the 1,640," they reported. "According to the study, 15 CEOs left over allegations of professional misconduct; 20 left amid a scandal, 'typically under investigations for financial wrongdoing or other legal issues'; 24 saw their positions terminated; 39 left due to a merger or acquisition; 3 left due to bankruptcy... When an outsized number of CEOs decide to cash out their stock options, grab their golden parachutes, and flee their corner offices-- something smells. On top of that fishy smell comes a report from TrimTabs Investment Research that corporate insiders have reaped more than $50 billion in stock sales since May, putting insider selling on a pace not seen since 2006-- two years before the stock market and economic crash of 2008.)

A blunter instrument for measuring the economy are unemployment and eviction statistics, Yesterday the Department of Labor reported that another million American workers filed for first-time unemployment benefits last week. There are now around 27 million Americans getting some kind of jobless assistance. With the GOP blocking the $600 supplemental claim for unemployed workers, the economy is going to soon start feeling billions dollars light-- unless more workers are forced back into COVID-unsafe jobs, which is exactly what the GOP is hoping for by denying the benefits.

The Aspen Institute reported earlier in the month on the COVID-19 Eviction Crisis, which has between 30 and 40 million American renters at risk of eviction. A team of reporters wrote that the U.S. "may be facing the most severe housing crisis in its history. According to the latest analysis of weekly US Census data, as federal, state, and local protections and resources expire and in the absence of robust and swift intervention, an estimated 30–40 million people in America could be at risk of eviction in the next several months. Many property owners, who lack the credit or financial ability to cover rental payment arrears, will struggle to pay their mortgages and property taxes and maintain properties. The COVID-19 housing crisis has sharply increased the risk of foreclosure and bankruptcy, especially among small property owners; long-term harm to renter families and individuals; disruption of the affordable housing market; and destabilization of communities across the United States."

This chart shows eviction risk by state. Risks are lowest in Vermont and highest in states filled with morons who keep voting for politicians who bring them hardships, fools living in deep red Mississippi, Louisiana, South Carolina, Oklahoma and Tennessee.

Significant loss of rental income during the COVID-19 pandemic creates financial peril and hardship for renters, small property owners, and communities. Without rental income, many landlords may struggle to pay mortgages and risk foreclosure and bankruptcy. The National Consumer Law Center predicts that 3 million homeowners, or roughly 5%, will have significantly delinquent mortgages by early 2021. Currently, 44% of single-family rentals have a mortgage or some similar debt. Sixty-five percent of properties with 2 to 4 units and 61% of properties with 5 to 19 units have a mortgage. Foreclosure can lead to a lack of maintenance, urban blight, reduced property values for neighboring properties, and erosion of neighborhood safety and stability. Without rental income to pay property tax, communities lose resources for public services, city and state governments, schools, and infrastructure, and can expend significant resources managing or disposing of properties acquired through tax foreclosure.

The impact of an eviction on families and individuals is even greater. Following eviction, a person’s likelihood of experiencing homelessness increases, mental and physical health are diminished, and the probability of obtaining employment declines. Eviction is linked to numerous poor health outcomes, including depression, suicide, and anxiety, among others. Eviction is also linked with respiratory disease, which could increase the risk of complications if COVID-19 is contracted, as well as mortality risk during COVID-19. Eviction makes it more expensive and more difficult for tenants who have been evicted to rent safe and decent housing, apply for credit, borrow money, or purchase a home. Instability, like eviction, is particularly damaging to children, who suffer in ways that impact their educational development and well-being for years.

The public costs of eviction are far-reaching. Individuals experiencing displacement due to eviction are more likely to need emergency shelter and re-housing, use in-patient and emergency medical services, require child welfare services, and experience the criminal legal system, among other harms.

The eviction crisis and its devastating outcomes are entirely preventable. Policy interventions at the national, state, and local levels could avoid many of the devastating costs outlined above... [W]ithout federal financial assistance, any intervention will be a stopgap at best and may fail to prevent the eviction crisis and its collateral harm.

The most comprehensive policy proposals include a nationwide moratorium on evictions and at least $100 billion in emergency rental assistance. Combining this assistance with an extension of federally enhanced unemployment insurance for displaced workers would provide additional relief for renters. Responses like these could neutralize the eviction risk outlined in this report, eliminating the public and private costs of mass evictions that result from the pandemic. More importantly, they could prevent millions of people in America from experiencing unfathomable hardship in the months and years ahead. These solutions have passed the US House of Representatives two times, and have companion legislation in the Senate.

Similarly, studies have shown a civil right to counsel in eviction cases can deliver significant benefits for tenants and landlords. While exact figures vary by jurisdiction, tenants with counsel experience improved housing stability-- often by remaining in their home, but alternatively by obtaining additional time to relocate, avoiding a formal eviction on their record, and accessing emergency rental assistance or subsidized housing.  Representation also leads to lower default rates and more fairly negotiated resolutions with landlords that limit disruption from displacement and ensure the rights of all parties are exercised. Other policies, such as eviction record sealing and restrictions that preclude property owners from basing tenant eligibility on eviction records, can prevent the longer-term harm that comes from eviction.

Given the incredibly high cost of evictions to renters, landlords, and communities, a wide range of policy interventions would provide significant cost avoidance for state and local government across the US.

Writing for Bloomberg News yesterday, Noah Buhayar, asked half a dozen key questions about evictions and attempted to answer them as the country hurtles towards an eviction crisis of historic proportions.

1- How many people could face eviction?

He comes up with 30 million, citing that same Aspen report but acknowledges it could be more like 40 million. Absent significant federal help that the GOP is absolutely unwilling to provide, the country "is heading for a massive wave of housing displacement and insecurity. More people will double up with family or end up homeless."

2. Will this all happen at once?

He doesn't think so and wrote that "It may take a few months for evictions to ramp up... The federal moratorium expired on July 24, and landlords had 30 days to notify tenants if they wanted to evict them, meaning Aug. 24 was the earliest date at which the floodgates could open. As of the end of July, 30 states lacked state-level protections against eviction during the pandemic. But even in states where there are bans, they do little to clear people’s debts. Many now owe so much in back rent that they won’t be able to catch up, pushing landlords to evict them when restrictions lift.

3. What's bring done to avert this?

Trump's lame and pointless attempt to show he cares earlier this month "didn’t authorize any specific action. Real relief would have to come from Congress, and that means money-- lots of it. House Democrats have passed a plan that would provide $100 billion in rental assistance and ban evictions" but Republicans are eager to show the working class they are the party of cruelty and refuse to be anything at all.

4- Why would a landlord evict someone at a time of high unemployment?

"Landlords," he reminded his readers, "need to collect rent to cover their expenses, including mortgage payments and property taxes. Many also pay for utilities. Keeping non-paying tenants around can incur operating costs without generating any revenue. Property owners also worry that letting a renter live in a unit for free or reduced rent could encourage other tenants in a building to withhold some of their payments. Landlords may also be betting that they can fill empty units. Going into the pandemic, there was a severe shortage of affordable rental housing across the U.S. that was driving up rents faster than incomes. Vacancy rates were at decades-long lows.

5- Who gets hurt?

As usual, Blacks and Latinos much more than white people.

6- Is this a U.S.-only problem?

It isn't but most governments are handling it much better than Trump. Big surprise!

An aside: according to Nielsen's ratings, 14.1 million people watched Trump's lies-filled screed Thursday night, quite a few less than the 17.5 million who had watched Biden's the week before. Trump's 3 biggest markets were West Palm Beach, Memphis and Nashville. Biden's had been New York City, San Francisco and West Palm. (More people watched Biden than Trump in West Palm.)

Wrapped In His Flag And Carrying A Cross... by Nancy Ohanian

The Economy Has COVID-- But, Like Republican Governors, The Stock Market Is In A State Of Denial

Earlier this week, the National Bureau of Economic Research. declared that the U.S. is officially in a recession-- a GDP decline in back-to-back quarters. The stock market reacted by continuing a climb unhinged from any kind of economic reality. On Thursday, the markets finally seemed to get the message-- at least for the day-- as the Labor Department reported another 1.5 million American filed for unemployment benefits and Treasury yields dropped, the the benchmark 10-year Treasury note plunged 6 basis points to 0.681% and the 30-year bond fell 7 basis points to 1.440%.

Yesterday, reliable USA Today columnist Michael Linden wrote about the disconnect between the economy and the stock markets, Forget the stock market. In the real economy, there's coronavirus and mass unemployment., noting the insanity of the 30% increase in stock prices since the March lows.

Over the past two months, more than 37 million people have filed for unemployment and millions more have seen their hours cut (or have had to drop out of the workforce altogether). The unemployment rate in May for black people increased to 16.8%. Permanent job losses actually increased in May by almost 300,000, and since February, the economy has lost over 1 million permanent jobs. Some economists have estimated that the true overall unemployment rate for April was high as 34%. GDP-- while not the most complete or representative measure of the economy-- is expected to shrink as much as a cataclysmic 30% in the second quarter.

Frontline workers will tell you that they lack decent pay and safe working conditions. State and local governments are clamoring for resources as tax revenue dries up. The vast majority of small businesses have found themselves shut out of relief, for lack of an existing relationship with the big banks acting as the gatekeepers for loans. And millions upon millions of families are worried every night about how they will make it through the next day.

Clearly, for most people, the economy isn’t doing very well at all.

So, which is it? Is the stock market really the best assessment of the economy’s overall strength and potential, or is it fully divorced from the real economy that the vast majority of Americans experience day in and day out?

The stock market could hardly be a worse indicator for how the U.S. economy is actually doing. Focusing on the bottom lines of publicly-traded companies and the gross wealth hoarded by those at the top is not just an inaccurate way to measure our economy-- a fact that should be obvious at this point-- but it’s also a dangerous distraction from the steps the government must take to support the real economy: people.

To start, it’s helpful to examine who actually benefits from a strong stock market. The wealthiest 10% of Americans own 84% of stocks. Half of American families don’t have a penny invested in the stock market, and that includes 401Ks and other retirement savings. This is even lower among communities of color, with only 36% of Black families and 37% of Latin families owning stock.

Regardless of this shareholder breakdown, conservatives will say that high stock profits mean business executives can reinvest their gains into their workers. And yet, the wealth of billionaires in the U.S. increased by $282 billion in just three weeks when the market rallied in April-- even as 22 million people filed unemployment claims in that same time.

CEOs waxed poetic about the health and safety of their employees as they laid off thousands of workers, only to turn around and dole out hundreds of millions of dollars in dividends to their shareholders. Plain and simple, stock market increases and corporate bailouts further concentrate power and wealth into the hands of the few, away from workers and families.

Given that President Trump also stacked his “reopening the economy” council with dozens of Fortune 500 CEOs, it should come as no surprise that he and his allies in the Senate have primarily focused not on keeping people safe and providing relief, but on shielding companies from liability as they bring employees back to unsafe work conditions. The people closest to the Trump administration represent those who stand to gain the most from a booming stock market. It’s no wonder, then, that the president throws his weight behind policies expedient for the market and disastrous for millions of Americans’ health and stability.

The fallacy that financial markets are how to define economic success is exactly what got us where we are today: rampant inequality, a frayed safety net, and a middle-class teetering on the edge of disaster. It’s imperative that we correct decades of the conventional “wisdom” of what the economy needs, or what the economy is. Continuing to prioritize, even rely on, the reign of financial markets will not only not get us out of this-- it will leave us far worse off for the future.

Trump Has Failed America-- Badly-- So It Would Be Nice If The Democratic Party Stepped Up To The Plate For The Country

Die For Him Granpa by Nancy Ohanian

Frank Bruni's question-- Has Anyone Found Trump’s Soul? Anyone? in his Monday column seemed cheeky-- until you read it. He started by reminding his readers of how George W. Bush and Barack Obama demonstrated leadership in pulling the country together, the former after 9/11 and the latter after the Newtown murder of 28 children and teachers. Then he asked "Do you remember the moment when President Trump’s bearing and words made clear that he grasped not only the magnitude of this rapidly metastasizing pandemic but also our terror in the face of it? It passed me by, maybe because it never happened. In Trump’s predecessors, for all their imperfections, I could sense the beat of a heart and see the glimmer of a soul. In him I can’t, and that fills me with a sorrow and a rage that I quite frankly don’t know what to do with."

Americans are dying by the thousands, and he gloats about what a huge, rapt television audience he has. They’re confronting financial ruin and not sure how they’ll continue to pay for food and shelter, and he reprimands governors for not treating him with adequate adulation.

He’s not rising to the challenge before him, not even a millimeter. He’s shriveling into nothingness.

...In the Washington Post a few days ago, Michael Gerson, a conservative who worked in Bush’s White House, wrote that Trump’s spirit is “a vast, trackless wasteland.” Not exactly trackless. There are gaudy outposts of ego all along the horizon.

When the direness of this global health crisis began to be apparent, I was braced for the falsehoods and misinformation that are Trump’s trademarks. I was girded for the incompetence that defines an administration with such contempt for proper procedure and for true expertise.

But what has taken me by surprise and torn me up inside are the aloofness, arrogance, pettiness, meanness, narcissism and solipsism that persist in Trump-- that flourish in him-- even during a once-in-a-lifetime emergency that demands something nobler. Under normal circumstances, these traits are galling. Under the current ones, they’re gutting.

“I don’t take responsibility at all.” “Did you know I was number one on Facebook?” To bother with just one of those sentences while a nation trembles is disgusting. To bother with both, as Trump did, is perverse.

...And while I’m not looking to Trump for any panacea, is it too much to ask for some sign that the dying has made an impression on him, that the crying has penetrated his carapace and that he’s thinking about something other than his ratings? I watch. I wait. I suspect I’ll be doing that forever.

Different people are looking for different things from Trump. Surely, though, the Democratic Party is looking for ways to kick the shit out of him with his own actions and words and inactions. Yesterday, Politico's David Siders and Elana Schneider wrote that the party seems to have found a rallying cry: Trump tanked the economy... even if "framing a coherent economic argument that all the party’s factions can rally around is proving thorny." Yep... the ole problem of a tent too big coming to mean nothing at all. They wrote that "It’s already become a source of friction within the Democratic Party, even as some major Democratic outside groups begin pummeling Trump for the economic fallout of the pandemic. It‘s a message Democrats plan to amplify in coming months, long after the immediate health effects of the crisis subside."

The left flank is increasing pressure on Joe Biden, the party’s likely nominee, to adopt more progressive economic policies. Activists accuse Trump of prioritizing corporate America over low-wage workers, while many moderate Democrats are leery of drawing such distinctions, training their criticism of Trump solely on his initial mishandling of the pandemic.

“This is not just about saying, ‘Trump is not doing a good job,’” said Washington Rep. Pramila Jayapal, a prominent supporter of Bernie Sanders, who remains in the presidential race. “That is absolutely a piece of it, but it's also about, what are you going to do? What is your vision? … We should be talking about a payroll guarantee, like a bold pay payroll guarantee program, we should be talking about canceling student debt. I mean, these are the things that, they're not just progressive priorities anymore, they are going to be desperate needs for the survival and the recovery of our people in our economy.”

Jayapal added that Biden, should he become the nominee, will “absolutely” come under pressure from progressives to reconsider those policies ideas in light of the crisis.

Democratic establishment SuperPACs, stinking of corruption and conservatism-- Priorities USA, American Bridge, PACRONYM and Biden's Win the West-- are highlighting unemployment statistics alongside coronavirus deaths, and Trump's inadequate response to the pandemic.

“Democrats, ever since before 2016, haven’t really had an economic profile. People couldn’t name what the Democratic economics was, and it was a major reason why Trump won in 2016,” said Celinda Lake, a leading Democratic strategist and pollster who works with Biden’s presidential campaign but was not speaking for Biden or his advisers.

In the coronavirus response, she said, “there’s a real opportunity to define … what is a people-centered economy, what is an economy that works for everyone, and we should be leaning into this.”

Robert Reich, the Clinton-era Labor secretary, said the crisis presents Biden with a unique opportunity to make policy changes that he might otherwise have difficulty explaining.

“Even if he wants to be perceived as cautious and prudent on issues like income support and health care, the pandemic gives him more room for being bold than he had before the pandemic,” Reich said. “A national trauma such as we are experiencing and definitely will experience over the next month or two enables a politician … to say, in effect, ‘I’ve now seen what the country needs in a way that the country has also experienced, and therefore I’m modifying the position.’”

While the general election is still seven months away, the effect on the electorate is likely to endure after weeks of deaths, stay-at-home orders, job losses and business closures.

“When we come out of this, millions of Americans will have a very different experience of what happened than they had at any time in their lifetimes before,” Reich said. “It’s almost like going through the Great Depression or World War II in the sense that the direct experience of a traumatic event changes attitudes towards government and public policy, sometimes in profound ways.”

In response to criticism from Democrats, Trump’s campaign has highlighted the relief measures he has signed into law, while accusing Biden of “sniping from the sidelines.” The president has suggested the economy will be moving again before the general election, and direct payments to millions of Americans-- even if late arriving-- could benefit him in November.

But the economic damage from the pandemic has already proved severe, and it is widely expected to worsen this month. House Speaker Nancy Pelosi called Friday for an expansion of the $2 trillion relief package Trump signed, including more money for small businesses and more direct payments to Americans.

Barry Goodman, a Democratic National Committee member and bundler for Biden, said Democrats should clobber Trump for his hesitance to embrace public health measures detrimental to the stock market, saying that “his infatuation with the stock market and keeping the economy running and humming … he believed that over the science.”

“He ended up tanking the economy worse than it ever could have been tanked,” Goodman said.

This is a brilliant video presentation. I really want you watch it so you can imagine someone playing it at the virtual Democratic Convention this year. Nevermind about that; it's as likely to be played by the Democratic Party as it is likely to be played by the Republican Party-- and that's a travesty. "Unite in solidarity with your fellow workers and press your demands" is something you could have heard at a Democratic Convention a few decades ago. "Capitalism is the root of all of today's evils and cannot solve the problems it creates." Ypu've have to go back a little further to have heard that at a Democratic Convention. "Those in power will listen to the rest of us if we can organize and really pressure them to enact our demands. Whether you make $15,000 a year of $150,000, if you sell your labor and hours of your life for a wage, you are working class. That should be a mark of pride because it's the working class that keeps this country running. The parasites at the very top don't care if you die. They would rather kill millions of Americans than lose a single percent of their wealth. It's time to remember the language of class struggle and fight for dignity and a livable future." You think you can get your garden variety Democratic Congress Member behind those sentiments? Like I've said before... the tent's too damn big. And the thermometer above? If you listen to the video, you'll know why I put that there; I guarantee it.

Trump Vows To Cut "Entitlements" If He Gets A Second Term

That was quite the Fox New town hall in Scranton-- Biden's brithplace-- Thursday. The very first question was about his incompetence regarding the coronavirus. Trump responded that "we've been given tremendous marks... We've gotten the highest poll numbers of anybody for this kind of a thing." An election between he and Biden would leave voters to decide which codger's dementia is worse. anyway, Trump's answer wasn't just disjointed and manipulative; it was false. The U.S. response is being held up all over the world as the worst responder imaginable.

"Mike Pence is working 20 hours a day on this-- or more-- on this and really doing a fantastic job." Gee, how did he fit in that Vern Buchanan fundraiser in Florida where he shook hands with a guy now quarantined as a suspected coronavirus sufferer? "Nobody is blaming us for the virus-- nobody." OK, true-- he didn't create the virus; he just allowed it to spread to the U.S. with his stupid response to it.

Then he started lying about the impact of the pandemic on the economy. "we were set to hit 30,000 on the Dow. This is a number that nobody even came close to. And already we have the number and even though it’s down 10 or 11%, it’s still the highest it’s ever been, by far. It certainly might have an impact. At the same time, I have to say, people are now staying in the United States, spending their money in the U.S.-- and I like that. I've been after that for a long time. You know that. I've been saying 'let's stay in the U.S. and spend your money here-- and they're doing that, sought of enforced doing that. We met with the airline companies yesterday. They're doing a fantastic job... It's gonna all work out; everybody has to be calm. It's all going to work out. Feel reassured? The Dow dropped another xx points when it opened a few hours later.





Later they got to Trump promising to cut "entitlements," which is the way conservatives refer to Social Security, Medicare and Medicaid. It came inside the discussion of trillions of dollars by which Trump has run up the national debut (up 18%). He said he had to fix the military; didn't mention the tax cuts for the wealthy. And then blamed the debt on Obama. He said he will focus ("absolutely") on cutting the debt in his second term. Asked about entitlements, he answered flippantly, "Oh, we'll be cutting."

Jonathan Chait noted in his column yesterday that that Trump's attempt to reassure people about the economy amounted to a "string of sentences like an onion of stupidity, and peeling back each layer revealed even more stupidity lying beneath." That's an accurate description. Trump's followers at the event cheered and applauded throughout. After all, Biden has spent his entire career vowing to cut entitlements as well. Maybe I made a mistake when I moved back to the U.S. from Holland in the '70s.

Morris Pearl, Chair of the Patriotic Millionaires and former managing director at BlackRock, noticed Trump admitting his intentions even if the fools in the audience didn't. He reminded everyone why no one should be surprised. "This is straight out of the Republican playbook," he said. "First they passed the $2 trillion Tax Cuts and Jobs Act, giving a huge windfall to millionaires, billionaires, and special interests. Next, they play shocked that cutting taxes results in less tax revenue, and say that the only way to shrink the deficit that they caused is to cut vital services that millions of Americans rely on. As GOP donors laugh all the way to the bank, GOP leadership calls for cuts to services the American people need and have earned and have paid for. That’s just un-American. When Republicans are cutting taxes for the rich they are allowed to change the deficit to whatever they want. When Democrats try to pass spending legislation, the deficit number is written in stone and cannot be changed. And when the Republicans decide to be 'deficit hawks' again and claim to worry about the increasing deficit, the only people they ask to sacrifice are the poor and needy. Tax cuts for the rich we can afford, but programs that give the poor and elderly healthcare are out of the question. This is textbook behavior, and it’s textbook cruel."

The perfect Democratic Party scenario-- a lesser of two evils election. The elites at the top of the party don't believe in Democratic Party values so they offer Republican-lite candidates as alternatives. Voters are then forced to choose between a complete nightmare or a... bad dream. Trump or Hillary? That went poorly. Trump or Biden? If that happens it will probably go even worse. Imagine an election about which one's family is more repulsive and corrupt. Which one's dementia is more advanced? Which one will cut Social Security and Medicare less? This is what anyone who votes for Bidenin the primaries is asking for. Knock yourselves out; you'll deserve exactly what you get... and it ain't gonna be pretty. Remember, a lesser evil is still evil. After primary season, it's too late to fix that.

The Numbers Are In: Trump Has Been Bad For The Economy-- Even Before His Stock Market Collapse-- And There Will Be Electoral Consequences

Trump's economy is coming apart-- and it's not just the coronavirus' impact on Wall Street. Newsweek reported that since Señor Trumpanzee took office, income growth has slowed significantly compared to the growth rate under Obama. Jessica Good heart wrote that "All but two states saw a decline in growth of real median household income under Trump-- including Pennsylvania, Wisconsin, Michigan, and Florida, four states widely regarded as the key electoral battlegrounds that will likely determine the 2020 presidential election. Middle-class incomes grew at a rate of 2.7 percent from 2016 through 2018, compared to a 5.8 percent growth rate from 2014 through 2016 when accounting for inflation." The states that had it worst-- a decline in real median household income-- were Alaska, West Virginia, South Dakota, and Wyoming, although New Mexico and Connecticut were also hurt badly from Trump's economic policies.

Presidents often claim too much credit and take too much blame for the country's economic performance, economists agree. Indeed, David Cooper, a senior analyst with EPI, who led the analysis of Census data, says that Obama benefited from a prolonged low rate of inflation during the last two years of his presidency. A low inflation rate makes it easier for households to stretch a dollar to cover basic necessities.

But, economists also say Trump has squandered opportunities to support greater gains for middle-class families, and, in some cases, he has backed policies that have worked counter to their interests.

"An infrastructure bill would clearly have [had] a marked impact, especially on middle-level jobs," says Mark Muro, a senior fellow at the Brookings Institute's Metropolitan Policy Project. "Manufacturing is going in the wrong direction. I think there are all kinds of policy opportunities that have not been exploited."

Muro sees some warning signs for 2020, such as the manufacturing recession and uncertainty over trade due to the lingering effects of the trade war and now the coronavirus, which has sickened tens of thousands of people in China and shuttered factories. Factory production in the U.S. shrank by 1.3 percent in the past year, according to the Washington Post.

EPI's Lee argues that Trump has taken steps that have hurt the middle class, including the 2017 Tax Cuts and Jobs Act and the overturning of regulations like overtime protection that shore up workers' paychecks. "The current administration's focus on cutting taxes for the wealthy, expanding tax incentives for outsourcing, and undercutting workers' rights has left ordinary working households in most states barely gaining ground," notes Lee.

But we ain't seen nothing yet. Sane people expect the coronavirus disaster to make the economy far worse. One of those sane people, Matt Stoller, wrote for Wired this week that Covid-19 Will Mark the End of Affluence Politics. For example: "we will, in all likelihood, be locking down travel in some areas of the U.S. for several weeks, as they did in China. People may be advised against gathering in large groups. It's not clear what any of this will mean for campaigning or primary voting, whether most of us will vote by mail or have our votes delayed. Moreover, the coronavirus is going to introduce economic conditions with which few people in modern America are familiar: the prospect of shortages. After 25 years of offshoring and consolidation, we now rely on overseas production for just about everything. Now in the wake of the coronavirus, China has shut down much of its production; South Korea and Italy will shut down as well. Once the final imports from these countries have worked their way through the supply chains and hit our shores, it could be a while before we get more. This coronavirus will reveal, in other words, a crisis of production-- and one that’s coming just in time for a presidential election."

We've been through something like this once before. My book Goliath describes the 1932 campaign for president, one that was carried out at the depths of the Great Depression and during an era when our productive capacity was shut down. Though the crisis at that time was caused by a banking collapse, not a pandemic, the political backdrop was analogous. Eighty-eight years ago, “old order” politicians, as they were known, proved unwilling-- even in the face of crisis-- to have the government apply its power toward the broader public benefit. Their recalcitrance prefigured, in certain ways, the reflexively libertarian thinking of today.





A toxic ideology invited disaster in 1932, as policymakers did little in response to the collapse of thousands of banks and businesses. At the depth of that depression, cotton hit its lowest price in 200 years and steel production fell to 15 percent of capacity. The situation became so desperate that in just one city, Toledo, Ohio, 60,000 of the 300,000 residents stood in bread lines every day. Children were competing with rats for food. And thousands were dying of dysentery. The politics too turned desperate, with one labor leader telling Congress that "if the Congress of the United States and this administration do not do something to meet this situation adequately, next winter it will not be a cry to save the hungry, but it will be a cry to save the government.”

And yet, the old order had no answers. Congress held hearings, but businessmen, academics, and bankers proffered only belt-tightening. Within the Republican establishment, President Herbert Hoover worked 18-hour days, exhorting confidence while refusing to take even basic steps such as having the government guarantee bank deposits. Instead, his administration’s army attacked hungry protesters in Washington, DC, a move that prompted an angry Republican congressman, Fiorello La Guardia of New York, to remind the president: “Soup is cheaper than tear gas bombs.”

Meanwhile on the Democratic side, conservatives and progressives in the party were locked in a bitter battle for the nomination. Many Democrats agreed with Hoover. Maryland governor and presidential candidate Albert Ritchie, for instance, argued that we should rely “less on politics, less on laws, less on government.” Another candidate, Speaker of the House John Nance Garner, claimed the greatest threat was the “tendency toward socialism and communism” and pledged a massive cut in government spending, as well as a sales tax increase. Others turned to extreme racism and xenophobia. Only Franklin Delano Roosevelt, who went on to win a contested convention, campaigned on aggressive government involvement in the economy—or as he put it, a “workable program of reconstruction,” which later became the New Deal.

That era’s political desperation is alien to us for a few reasons. First off, we haven’t faced shortages of such magnitude for a very long time. More importantly, we have for decades lived under a political framework known as affluence, a term popularized by economist John Kenneth Galbraith in the 1950s. As an affluent society, America automatically produces a surfeit of jobs and wealth, and the problem is solely one of distributing the bounty.

Under the siren song of affluence, we began offshoring critical production capacity in the 1960s for geopolitical reasons. In 1971, economist Nicholas Kaldor noted that American financial policies were turning a "a nation of creative producers into a community of rentiers increasingly living on others, seeking gratification in ever more useless consumption, with all the debilitating effects of the bread and circuses of imperial Rome." Still, Bill Clinton and George Bush accelerated this trend throughout the 1990s and 2000s.

Affluence politics is not the politics of being wealthy, though, but rather the politics of not paying attention to what creates wealth in the first place. That is to say, it’s the politics of ignoring our ability to make and distribute the things people need. With the banking collapse in 2008, the election of Trump in 2016 and his mourning of empty factories, and now with Bernie Sanders dominating the early primaries, that era may at last be passing. A pandemic disease outbreak would only hasten this progression and force us back into the politics of production.

With potential shortages of goods, and restrictions on people’s movement, both parties are heading into unknown territory. It is likely Democrats will use this opportunity to further their case for Medicare for All. Pandemic surveillance and medical bureaucracies focused on billing do not mix well-- stories about astronomical out-of-pocket costs for Covid-19 testing are already circulating. Republicans are likely to take a more xenophobic approach, emphasizing restrictions on foreigners and infected Americans. When it comes to managing shortages, however, both parties are split, just as they were in 1932, between their Wall Street factions that assume affluence and the less mature populist factions that seek assertive public power. The Democratic Party primaries certainly echo those of the Great Depression, with candidates from Bernie Sanders to Amy Klobuchar trying to wrap themselves in FDR’s mantle.

Regardless, the end of affluence politics means focusing on whether medicine is on shelves, not bitter disputes over bloated and wasteful hospital and insurance billing departments. It means caring about bureaucratic competence in government, and accuracy in media, not because these are nice things to have but because they are necessary to avoid immense widespread suffering. It means understanding that pharmaceutical mergers that benefit shareholders while laying off scientists are destructive, not just because they are unfair, but because they make us less resilient to disease. (Shareholders, as it turns out, also have lungs.) Finally, it means recognizing that wealth, real wealth, is not defined by accounting games on Wall Street, but the ability to meet the needs of our own people.

We came to these realizations once before in 1932, and created a vibrant democratic state over the following few decades-- one that rapidly expanded our life spans, defeated the Nazis, and helped create Silicon Valley. The convergence of the Covid-19 outbreak and the presidential election will force us to do it once again. We've lived in the world of unreality for far too long.

As Richmond Federal Reserve Bank president Tom Barkin recently put it, “Central banks can’t come up with vaccines.” It's time to get ready for what that implies.

Yesterday, Trump was in South Carolina giving his supporters exactly the kind of information that will kill them. He called the coronavirus the Democrats' "new hoax... The Democrats are politicizing the coronavirus. They're politicizing it. They don't have any clue. They can't even count their votes in Iowa. No, they can't. They can't count their votes. One of my people came up to me and said, 'Mr. President, they tried to beat you on Russia, Russia, Russia.' That did not work out too well. They could not do it. They tried the impeachment hoax." He's literally going to kill his own supporters. Listen to this:

How's Your Buying Power Lately?

The stock market continues to soar. My financial advisor ignores me when I wring my hands and tell her to change my asset allocation so that I have less stock. By ignoring me, she's brought me a lot more money. But I would just feel so much safer in more bonds and real estate and less sticks. Because, everyone knows this asshole is going to crash the market at some point. And that comes fast and hard and it's too late when that death spiral begins. Every time I can get her to put even a small amount more into bonds, I feel a sense of accomplishment. I'm having dinner with her in a week or two and I'll tell her to lighten up on the stocks some more. Meanwhile, though, I'm certain she's not as big a Bernie fan as I am. Although she loathes Trump.

This morning, the Financial Times reported that 56% of all equities (in terms of value) in this country are owned by just 1% of Americans... and yet Trump's whole campaign is going to eventually come down to "the economy, the economy, the economy." Without a doubt Bernie is best equipped to go toe to toe him on that, not Steyer and not the more venal billionaire Bloomberg, let alone clowns and empty suits like Mayo, Status Quo Joe or Klobuchar. Presidents don't react jobs by Trump's policies and administration created 1.5 million fewer jobs in his first three years in office than predecessor Barack Obama did in his final three. Newly revised figures from Trump’s own Department of Labor show that 6.6 million new jobs were created in the first 36 months of Trump’s tenure, compared with 8.1 million in the final 36 months of Obama’s-- a decline of 19% under Trump. During the SOTU address, when Trump said "If we hadn’t reversed the failed economic policies of the previous administration, the world would not now be witnessing this great economic success," he was-- as he does constantly-- lying and gaslighting.

Last week, writing for The Atlantic, Annie Lowrey noted that "in one of the best decades the American economy has ever recorded, families were bled dry: The Great Affordability Crisis Breaking America. "In the 2010s," she wrote, "the national unemployment rate dropped from a high of 9.9 percent to its current rate of just 3.5 percent. The economy expanded each and every year. Wages picked up for high-income workers as soon as the Great Recession ended, and picked up for lower-income workers in the second half of the decade. Americans’ confidence in the economy hit its highest point since 2000, right before the dot-com bubble burst. The headline economic numbers looked good, if not great. But beyond the headline economic numbers, a multifarious and strangely invisible economic crisis metastasized: Let’s call it the Great Affordability Crisis. This crisis involved not just what families earned but the other half of the ledger, too-- how they spent their earnings. In one of the best decades the American economy has ever recorded, families were bled dry by landlords, hospital administrators, university bursars, and child-care centers. For millions, a roaring economy felt precarious or downright terrible."

Viewing the economy through a cost-of-living paradigm helps explain why roughly two in five American adults would struggle to come up with $400 in an emergency so many years after the Great Recession ended. It helps explain why one in five adults is unable to pay the current month’s bills in full. It demonstrates why a surprise furnace-repair bill, parking ticket, court fee, or medical expense remains ruinous for so many American families, despite all the wealth this country has generated. Fully one in three households is classified as “financially fragile.”

Along with the rise of inequality, the slowdown in productivity growth, and the shrinking of the middle class, the spiraling cost of living has become a central facet of American economic life. It is a crisis amenable to policy solutions at the state, local, and federal levels-- with all of the 2020 candidates, President Donald Trump included, teasing or pushing sweeping solutions for the problem. But absent those solutions, it looks certain to get worse for the foreseeable future-- leaving households fragile, exacerbating the country’s inequality, slowing down growth, smothering productivity, and putting families’ dreams of security out of reach.

The price of housing represents the most acute part of this crisis. In metro areas such as the Bay Area, Seattle, and Boston, severe supply shortages have led to soaring prices—millions of low- and middle-income families are no longer able to purchase centrally located homes. The median asking price for a single-family home in San Francisco has reached $1.6 million; even with today’s low interest rates, that would require a monthly mortgage payment of roughly $6,000, assuming that a family puts down the standard 20 percent. In Manhattan, listings for sale now ask an average of nearly $1,800 per square foot.

The housing cost crises in the Bay Area and New York might be the country’s most obscene. But the problem is national, driven by a combination of stagnant wages, restrictive building codes, and underinvestment in construction, among other trends. Home prices are rising faster than wages in roughly 80 percent of American metro regions. In 2018, housing affordability declined in every one of the 160-some urban areas analyzed by the National Association of Realtors, save for Decatur, Illinois. Rising prices and housing shortages are squeezing families in Reno, Minneapolis, and Phoenix.

The problem now even extends to rural areas, where income growth has lagged in the post-recession period. A recent report by the Pew Charitable Trusts found “sizable” increases in the number of households spending half or more of their income on housing in rural counties across the country. The housing crisis is hitting Bertie County, North Carolina, and Irion County, Texas, too.

One central effect of the housing-cost crisis has been to turn the United States into a country of renters. The homeownership rate has fallen from a peak of nearly 70 percent in the mid-aughts to under 65 percent today; the numbers are more acute for Millennials, whose homeownership rate is 8 percentage points lower than that of their parents at the same age. Unable to buy, roughly 3.5 million younger families have kept renting-- delaying the Millennial and Gen X cohorts’ wealth accumulation, thus consigning them to worse net-worth trajectories for the rest of their lives. And renting, for many families, is not affordable, either: Nearly half of renters are facing uncomfortable monthly bills, and the cost of renting has risen faster than renters’ incomes for a full 20 years now.

The cost-of-living crisis extends beyond housing. Health-care costs are exorbitant, too: Americans pay roughly twice as much for insurance and medical services as do citizens of other wealthy countries, but they don’t have better outcomes. In the post-recession period, premiums, deductibles, and out-of-pocket costs in general just kept rising, eating away at families’ budgets, casting millions into debt, and consigning millions more to bankruptcy.

Shan Chowdhury, the progressive candidate running in southeast Queens has made affordable housing his top campaign issue, along with affordable healthcare. "The cost of living is way too high and wages have remained stagnant," he told us today. "We have to ask ourselves who this country is changing for? The wealth disparities are greater today than it was 50 years ago. With crumbling student debt, low wages, inaccessible healthcare, jobs and opportunities-- we have to tip the power back to working families and out of the hands of billionaires who profit off our backs."

Spokane area progressive Chris Armitage is running hard on Medicare-for-All. "Here in eastern Washington, folks share plenty of stories about their healthcare situations," he told me. "While in a local farming community, a woman told me about how her family of five. Three have diabetes, but they share a single insulin prescription each month. I wish this horrible situation was unique, or even uncommon, but the truth is many families in our rural communities lack the basic healthcare all humans need to live a full, productive life. Inaction in DC is killing people in our district. Our rural families deserve better. We are ready for Medicare for All because, as my former Commander said 'the best answer is the right answer, the second best answer is the wrong answer, and the worst answer is no answer."

Rachel Ventura, a progressive candidate for Congress in the Chicagoland suburbs sits on the modern housing solutions committee in Will County and she told me they too have a housing crisis. "We just don’t have enough housing period. Affordable housing, transitional housing, starter homes, mid size, or high market homes are all on high demand. As our area grows the incomes are definitely not keeping up which is pushing more Chicago residents to move to our area furthering the problem. Our committee is looking at cargo homes, tiny homes, vertical building, and other solutions outside the box. Unfortunately the trade war and the race to the bottom labor practices have complicated the issue even more. It is no longer profitable to build homes in our area because they can’t buy quality products or hire qualified labor for the price people can afford. Instead our area builds more warehouses. Creating millions of living wage jobs is just the beginning. Just one more reason why we must pass the Green New Deal. I look forward to applying my knowledge from the local level to the federal level to create policies that help communities build and retrofit homes for the future."

Young Turks founder and host Cenk Uygur is a first-time congressional candidate in the suburbs north of Los Angeles. "This current barbaric system," he told us this morning, "is crushing us on a daily basis. In some ways, I view my election as a rescue mission-- 45,000 people a year die because they don't have health insurance. We have to save their lives! We also have to save families from being financially ruined and out on the streets even if they have insurance. Every other developed country covers everyone and pays less!"

Montana state Rep. Tom Winter is running for the Montana open congressional seat this year. There are both a conservative Republican and a conservative Democrat who believe in Austerity. Tom backs single payer Medicare-for-All and is campaigning on it. "The whole reason I'm running for Congress," he told me "is because our broken political system is failing working Montanans. Working families all across this state are struggling to afford to live in an economy that seems to be rigged against them every step of the way. Healthcare is unaffordable. Housing is unaffordable. Childcare is unaffordable. 'Full employment' used to mean everyone had a job-- now it means many of us have two. Montanans shouldn't be priced out of being able to live in the state they built simply because they don't have the power to buy politicians and pay lobbyists to cater each and every law towards their best interest. We must rebuild an American economy that rewards work rather than wealth, and doesn't make living unaffordable. He was just getting warmed up:

Montana's hospitals charge patients nearly three times more than what the federal government sets as a 'fair' cost for care under Medicare. Prescriptions are being left unfilled. Life-saving drugs are being rationed. Working families are being saddled with medical debt, and in some cases across the country they are being imprisoned for it. People are being charged hundreds and sometimes thousands of dollars a month for insulin costs-- while it costs $39 just 15 minutes north of Eureka, MT over the border. Montana's critical access and rural hospitals are at constant risk of closure.

Montana’s cities rank as some of the most unaffordable in the nation. The rest of the country thinks this is only a problem in cities like Seattle and San Francisco. But ask anyone working a 9-to-5 in Bozeman or Missoula if they have a realistic chance of owning a home. For the same price you would have paid 5 years ago you get half the square footage, bedrooms, and bathrooms for a median house now.

Every day, families across Montana wake up to our ongoing childcare crisis. Over 45,000 children under the age of 6 need childcare in Montana while childcare facilities in the state only have capacity for 20,000. Childcare costs ($34k for 4 years) families more than in-state college tuition ($29,900 for 4 years) in Montana. Over 42% of single mothers with children under the age of 5 are living in poverty. Single Parents earning minimum wage pay 54% of their income towards childcare.

"If I'm painting a dire picture," Winter concluded, "it's because this is how the other half of the country lives. Politicians always claim to support families, but when it comes right down to it working families are left in the lurch. Montana is running out of time. We could care less how well the Dow is doing or how low the unemployment rate is. We need healthcare. We need housing. We need childcare. We need to be able to afford to live."

The “cost burden” of health coverage climbed through the 2010s; just from 2010 to 2016, family private-insurance premiums jumped 28 percent to $17,710, while median household incomes rose less than 20 percent. That meant less take-home pay for workers. Deductibles-- what a family has to fork over before insurance kicks in-- also soared. From 2010 to 2016, the share of employees in health plans with a deductible jumped from 78 percent to 85 percent. And the average annual deductible went from less than $2,000 to more than $3,000.

The country’s insurance premiums and out-of-pocket health-cost burdens are just very, very high-- including for people with publicly subsidized or public coverage. The average person on Medicare spends $5,460 on health care beyond what they pay for insurance every year. The average person with Medicaid forks over nearly half that. No wonder two in three bankruptcies are related to medical issues, and nearly 140 million American adults report “medical financial hardship” each and every year.

Next up is student-loan debt, a trillion-dollar stone placed on young adults’ backs. Or, to be more accurate, the $1.4 trillion stone, up 6 percent year over year and 116 percent in a decade; student-loan debt is now a bigger burden for households than car loans or credit-card debt. Half of students now take on loans of one kind or another to try for a higher-ed degree, and outstanding debts typically total $20,000 to $25,000, requiring monthly payments of $200 to $300-- though of course many students owe much more. Now nearly 50 million adults are stuck working off their educational debt loads, including one in three adults in their 20s, erasing the college wealth premium for younger Americans and eroding the college earnings premium.

The Rochester, NY congressional district is safely blue but with a useless middle-of-the road backbencher as their Representative. Robin Wilt is running for that seat on a full-bore progressive platform. "The sharp increase in student loan debt is negatively impacting the U.S. economy by delaying the timeline for young people to buy houses and start families. Simply speaking, Boomers are less likely to be able to sell their homes because Millennials aren't in a financial position to buy them. We see this stagnation across the board, but this burden disproportionately affects borrowers of marginalized racial, gender and socioeconomic groups." She had a lot more to say about it:

"More and more, student borrowers have to dedicate ever-increasing portions of their income to student loan repayment, rather than spending on goods or services, traveling, getting married or buying a house. Moreover, many within marginalized communities are paying student loans with additional financial challenges stacked against them. This is particularly true in Rochester and Monroe County, which is plagued by the highest rates of segregation in the country. Not only are students of color more likely to borrow more for a degree and borrow in higher amounts for the same degree, but they’re more likely to struggle to repay student loans than their white counterparts. Meanwhile, the wage gap exacerbates the burden of student debt for women borrowers, since at all levels of educational attainment, women earn, on average, 25% less than men. Not only is the crushing burden of student debt weighing down potential growth in the U.S. economy, it is fundamentally altering our culture-- with people getting married and starting families later in life, and some questioning the value of higher education. Debt forgiveness is a positive way forward, with estimates that over the course of 10 years, student debt cancellation would create $943 billion in GDP, adjusted for inflation. Student debt cancellation results in economic growth by increasing the average households’ net worth and disposable income. This net increase in wealth drives consumption and investment spending. I wholeheartedly support student debt cancellation from a social justice standpoint, as well as from an economic sustainability standpoint."
 

Finally, child care. Spending on daycare, nannies, and other direct-care services for kids has increased by 2,000 percent in the past four decades, and families now commonly spend $15,000 to $26,000 a year to have someone watch their kid. Such care is grossly unaffordable for low-income parents in metro areas across the country, causing many people to drop out of the labor force. But one in four American mothers returns to work within two weeks of giving birth, so heavy are the other cost burdens of living in this country. The whole system is broken.

I spoke to three experienced candidates, Audrey Denney (CA), Brianna Wu and Marie Newman (IL) who came close in 2018 and plan to finish the job against their reactionary opponents, respectively Trumpist Doug LaMalfa, New Dem Stephen Lynch, and Blue Dog Dan Lipinski, this year. Audrey has watched her "friends struggle to afford to deliver their babies, miss work to care for their newborns, and provide childcare when they go back to work. I’ve watched as my close friends drop out of the workforce once they’ve had a second child-- not because they wanted to-- but because they could afford it. These are women who are teachers, manage restaurant chains, and who had management roles at non-profits. Celebrating our mothers on Mother’s Day is not enough, we must pass legislation to support maternity leave, women’s health, and affordable childcare options. Not only do we have the highest maternal mortality in the developed world, we are the only developed country that is seeing increases in maternal mortality. We are also experiencing shocking rates of postpartum depression (as high as 1 in 5 in some states!). We have to be better at creating conditions where new moms can care for their physical and mental well-being and that starts with paid maternity leave."

Everything that motivates and propels Brianna Wu's campaign has been about greater equality. And when it comes to the high cost of educational loans, she told us that "Higher education has become big business in this country, and the burden is placed on the backs of nearly 50 million Americans who just want an education for a chance of success at life. I know people in their 40s who are still paying off student loans 20 years after they graduated from college. Higher education, whether it's a college or university or a trade school, should not have the potential to bankrupt any American, or place an incredible burden on students right out of the gate. I fully support tuition-free public college for all.  It's the right thing to do, and it can be done. We need leaders in our government with the political will to do it. My opponent, Rep. Stephen Lynch, is silent on it, as he is most every initiative that will better the lives of Americans. When I get to Congress, tuition-free public college will be a priority for me."

Marie Newman had similar experiences and told me "The cost and lack of affordabilty of our daily lives, Is why I have an affordable solutions set in platform. Among these solutions in this platform is universal childcare where we would leverage existing assets like schools, libraries and community centers to offer 12 hr care to our kids. We cannot expect parents to continue to work 2 and three jobs round the clock."

The federal government has set as a benchmark that low-income families should not spend more than 7 percent of their income on child care. But child care is generally the single biggest line item on young families’ budgets, bigger even than rent or mortgage payments: Putting a kid in daycare costs 18 percent of annual income in California; home-based options equal 14 percent of family income in Nebraska; having an infant in professional care in the District of Columbia costs more than most poor families earn.

It all adds up, and it all subtracts from families’ well-being. The price tags for tuition and fees at colleges and universities have risen twice as fast as wages, if not more, in recent years. Rental costs are outpacing wage gains by a percentage point or more a year. Health-care costs have grown twice as fast as workers’ wages. And child-care costs have exploded. These cost pressures are particularly acute on young Americans who have seen worse employment prospects and smaller raises than their older counterparts.

The effects are wide-ranging. High costs are preventing workers from moving to high-productivity cities, thus smothering the country’s economic vibrancy and putting a drag on its GDP; economists have estimated that GDP would be as much as 10 percent bigger if more workers could afford to live in places like San Jose and Boston. High costs are forcing families to delay getting married and to have fewer children, and putting the dream of owning a home out of reach.

What is perhaps most frustrating is that the Great Affordability Crisis is amenable to policy solutions-- ones most other rich countries adopted decades ago. In other developed economies, child care, early education, and higher education are public goods, and do not require high-interest-rate debts or endless scrambling by exhausted young parents to procure. Other wealthy countries have public-health systems that cover everybody at far lower cost, whether through socialized or private models. And numerous proposals would transform residential construction in this country, including one that just failed in California’s legislature.

But the Great Affordability Crisis hides in plain sight, obvious to households but unmentioned in the country’s headline economic numbers. It persists even as President Donald Trump rightly praises the country’s growth, low unemployment rate, and rising household incomes. And though there are many nationwide policies that could end the crisis, they all seem unlikely to pass through the country’s broken Congress; the brightest glimmer of hope lies in housing and health-care policy by individual states. But it is still a dim glimmer. This crisis looks sure to stay with us for the coming decade, whatever recessions or expansions it may hold.

Jennifer Christie is a first time candidate, running for a seat north of Indianapolis. She knows quite a bit about the costs of child care. "I left a 'good job' when we adopted four children," she told me today. "In three years, we tripled our family size and had four children under four years old. My job required travel several times per month and often overseas. Childcare was not only complicated, but it was expensive. It would have cost well over 30,000 per year with so many littles. It just didn’t seem worth it to be away from my children so much and to give that much of my paycheck away.  So I started a home-based business and began teaching. My business was very successful; we were profitable, I had several employees, and was able to have a flexible schedule. I was so passionate about giving families freedom and a living wage that I mentored hundreds of other women entrepreneurs on starting their own business too. What I found was that childcare was the biggest challenge that women faced to start a business or to work at all, especially single moms who are some of the hardest working people on the planet. Childcare needs to be safe and affordable while paying childcare workers a living wage too (most childcare workers are also moms). We need the skills that moms bring to the table. I have worked in the sciences most of my career, but the toughest job around is Mom: it requires patience and strength, compassion and determination, selflessness and grit and so much more. Now more than ever we need a mom’s voice in Congress. I am running to be that voice to lift up families by guaranteeing universal healthcare, a livable planet, a living wage, education for all and universal childcare."

Pramila Jayapal, co-chair of the Congressional Progressive Caucus went over the Trump budget and told her Seattle constituents that his "budget proposal leaves no question: His Administration does not care one bit about poor, middle-class and working Americans, nor about the future of our country, global relationships or planet. On every level, this budget neglects the health of our people, planet and democracy. Trump’s budget slashes funding for the Environmental Protection Agency, leaving our water, air and communities vulnerable to pollution, toxins and climate change. It recklessly destroys infrastructure investments that our communities badly need, completely zeroing out federal funds that the 7th congressional district relies on to make our highways and bridges safer, maintain and expand our port and public transit systems and build more affordable housing."

Trump’s budget also destroys critical programs that have supported vulnerable Americans and helped lift millions out of poverty. It cuts $6.2 billion in federal funding for education programs, jeopardizing our children and their future, and proposes changes to Medicare and Medicaid and Social Security that will hurt millions of Americans. It also slashes funding for important programs that help workers stay safe on the job and protect seniors in the workforce.

Instead of investing in education, health care, affordable housing, public health and other important priorities, the Trump budget floods money into more cruel attacks on immigrants and people of color. Trump wants to steal money from vital programs to fund his vanity wall and flood billions in immigration enforcement activities that promote racial profiling and mistreatment of communities of color. President Trump does not understand the values and investments that have made America and our people strong-- and it is no surprise his budget fails to reflect them as well.

President Trump’s national security budget is completely out of touch with reality. For the fourth year in a row, Trump’s budget also cuts funding for the State Department and international development-- the deep and disproportionate 22% cut to these programs will undermine our diplomatic efforts around the world. Meanwhile the budget includes $740.5 billion in defense spending for an unaccountable Pentagon plagued with corruption. Funneling more and more money to the Pentagon, which has been unable to even pass an audit, does not make us more secure.