Whose fault is everything that’s wrong?
The Democrats don’t have convincing answers. They assail President Trump, of course—but worsening income inequality, a stagnant middle class and unaffordable health care were problems well before Trump came on the scene. In some ways, Trump got elected in 2016 because he addressed those issues more persuasively than other candidates.
The 20 Democrats who faced off recently in two inaugural debates came up with about half a dozen repeat offenders to explain who’s responsible for the economic strains in America. The most common bogeymen among leading Democrats are “giant corporations” (Sen. Elizabeth Warren), Wall Street banks (Warren and Sen. Bernie Sanders), pharmaceutical companies (Sen. Cory Booker and others), health insurers (Sen. Kamala Harris and others), oil companies (Warren), and billionaires (Sen. Amy Klobuchar). A few companies earned dishonorable mention by name, including Amazon, General Motors and McDonald’s.
These are broadside attacks on private-sector capitalism, and they’re not likely to carry the Democratic presidential nominee to victory in 2020. If Democrats want to play the blame game, they need to find better villains to pin America’s problems on. And a good place to look is in Washington, D.C.
[Check out our latest podcast, on Medicare for all: It ain’t all that.]
There’s nothing new about attacks on big business by populist politicians trying to rile up the proletariat. But here’s the problem: Americans are sort of getting along with corporate America these days. The big banks (aside from the bumbling Wells Fargo) haven’t wrecked anything lately, and they’re operating more responsibly under new rules put in place after the Wall Street meltdown in 2008 and 2009. Most Americans can get loans for cars and homes. Interest rates are low.
Out of step with mainstream Americans
The strong labor market means more workers are getting raises and surprising numbers are quitting for better jobs. Oh by the way, about 25 million work for those “giant corporations” Elizabeth Warren vilifies. Does she want none of their votes? Or merely want to turn them against their nefarious employers?
Health insurers and pharmaceutical firms are bad guys because they make health care too expensive and confusing. Except more than two-thirds of people with private, employer-sponsored health care say they like their coverage, with only 6% saying they hate it. Oil companies are bad because they produce the fossil fuel that’s causing global warming. Yet almost everybody travels in vehicles that burn that fuel, making nearly every consumer complicit with the evil oil companies.
Amazon (AMZN) is bad because of the low taxes they pay. General Motors (GM) laid off some workers earlier this year because they built an outdated economy car nobody wants to buy any more. And the CEO of McDonald’s (MCD) makes way too much money. That’s why Americans are boycotting these companies en masse, threatening to drive them out of business.
Oh wait—that’s not happening, because Americans love Amazon’s fast delivery and McDonald’s bargain meals. They’ve forgiven GM for its ugly bankruptcy and re-embraced its pickups and SUVs. The Democrats bashing these companies are out of step with mainstream Americans who want to get ahead but don’t feel that requires punishing anybody.
Trump’s blame game
There are some real problems contained in the Democrats’ grievances, but they stem more from bad Washington policies than from abusive corporate behavior. Amazon’s tax bill, for instance, is low because it takes advantage of tax breaks for things like research and investment. In 25 years, Amazon has grown from a one-person startup to a goliath that employs 600,000 people. If those tax incentives are meant to help companies grow, they worked. If the giveaways are too permissive, Congress should change them.
Reining in drug and other health care costs are thorny problems, but pharmaceutical and insurance companies also generate innovations such as HMOs and blockbuster drugs that wouldn’t happen without the profit motive. And while billionaires may make obscene amounts of money, that’s often because they built breakthrough businesses such as Amazon, Microsoft and Apple.
Trump is a practiced vilifier who fingers immigrants, China, Mexico, Barack Obama and other convenient targets for the economic pressure many Americans feel. Trump’s rebukes are oversimplified and sometimes flat-out wrong. But his blameful populism got him elected once, and could again.
If Democrats want to play Trump’s blame game, they need more believable villains. Or, they could skip the blame and just come up with pragmatic ways to solve problems. Not so long ago, that worked.
Rick Newman is the author of four books, including “Rebounders: How Winners Pivot from Setback to Success.” Follow him on Twitter: @rickjnewman