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Trump’s Economy Complicates Democrats’ Message

Karl W. Smith
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Trump’s Economy Complicates Democrats’ Message

(Bloomberg Opinion) -- In the states crucial to winning the Democratic presidential nomination — the four early primary states — economic conditions are unusually good. In the states critical to winning the presidency itself — mostly in the Rust Belt — they are not.

Regional variations in the U.S. economy make it especially difficult to forecast the 2020 election. They also complicate the campaign message for President Donald Trump’s eventual Democratic opponent: Whether centrist or populist, what works in the primaries may not be successful in the general election.

Conventional wisdom holds that Joe Biden, the leading moderate, will fare better in the industrial heartland than either of the two leading progressives, Elizabeth Warren or Bernie Sanders. But the polling doesn’t bear this out. Biden is surprisingly weak among white voters without a college degree in Pennsylvania, Michigan and Wisconsin.

Instead, his strength is among nonwhite voters and affluent white voters. The most straightforward explanation is that when voters look at Biden, they don’t see “Working Class Joe” but former President Barack Obama’s vice president.

And that’s where things get complicated. Obama was and remains personally popular, but he presided over the decline of the Rust Belt. In Wisconsin and Pennsylvania, job growth during Obama’s tenure was only 4%, compared to 8% nationwide. Perhaps even worse, he epitomizes the elite consensus on issues such as free trade and China, a consensus that working-class voters (not without reason) do not trust.

Of course, Trump’s policies have not been very successful in the Rust Belt either. To capitalize on that failure, the Democratic candidate would want to make the case that they will deliver the populist revolution that the president promised. That’s a more natural argument for Sanders or Warren than Biden.

It is not, however, an argument that reflects the economic realities of the early primary states. Even South Carolina, which as a major automotive and aviation manufacturer might seem vulnerable to Trump’s trade war, is showing healthy job growth. Iowa has also managed to come out of the trade war relatively well. While manufacturing employment has turned sharply negative in Wisconsin, Michigan and Pennsylvania, it remains robust in Iowa.

The economies of Nevada and New Hampshire, both more focused on tourism than trade, are all but immune to the trade war. The case for economic populism is weak in both states.

One question is what happens if the economies of Wisconsin, Michigan and Pennsylvania continue to weaken but the overall economy remains sound. If that’s that case, then a full-throated populist message, the kind that comes most naturally to Warren and Sanders, could be a winning one for Democrats. But again, it’s not one likely to find many takers in the first four primary states.

Variable economic conditions, combined with the vagaries of the primary schedule, will make it hard for Democrats to unify around a central economic message over the next several months. Nevertheless, there is one constant they can rely on: If the economy continues to weaken, then almost any Democrat will beat Trump. If it strengthens over the next six months, then he will beat almost any Democrat.

To contact the author of this story: Karl W. Smith at ksmith602@bloomberg.net

To contact the editor responsible for this story: Michael Newman at mnewman43@bloomberg.net

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

Karl W. Smith is a former assistant professor of economics at the University of North Carolina's school of government and founder of the blog Modeled Behavior.

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