IMMEDIATE RELEASE 22 October 2021
Today’s Events in Historical Perspective
America’s Longest-Running Column Founded 1932
Follow the money, not the polls
By Douglas Cohn and Eleanor Clift
WASHINGTON — The mood of the country is not good. The Pandemic has not yet ended. People are worried about inflation. Interest rates are expected to rise. Donald Trump is back sowing havoc. And President Biden’s poll numbers have cratered. Yet, the stock market is soaring.
Who’s right? The man and woman on the street telling pollsters about all that’s gone wrong since Biden won the election? Or the money men and women on Wall Street who are banking on a raft of new federal spending?
It all hinges on whether the Democrats can govern. They finally made some meaningful compromises to reach a deal on the most transformative piece of legislation since the New Deal. It’s a 10-year bill and they will have to trim back some of the programs to shorter windows to come in under the roughly $2 trillion mark Biden has set.
A child-care tax credit will only be carried forward a single year to make the numbers come out where they should, but Democrats are confident the program will be so successful in cutting child poverty that it will win support on its own merits in future congresses. Likewise, a 12-week paid family leave will shrink to 4 weeks, but it lays down a marker that in an economy where workers are gaining power and autonomy, the private sector should step in.
The one area where the negotiated compromise falls short is on climate change where the fossil fuel industry exerted its enormous lobbying power to block a significant part of Biden’s agenda to lead the world on the subject. “We did not get everything we wanted, but we got everything we need,” John Podesta, founder of the Center for American Progress, told CNN, as Democrats came together after months of dithering.
The constant drumbeat about how the Democrats can’t govern took a toll on Biden’s poll numbers and prompted Democrat Terry McAuliffe, running for governor of Virginia, to plead with his party to act soon or he could be the first casualty of their inaction. Voters cannot understand that even with Biden in the White House and Democratic control of the House and Senate, why the Democrats could not deliver.
As the gloom and doom took hold, Wall Street never wavered. The market has confidence that the Democrats will deliver, and that the $1.9 trillion (not to be confused with the $2-trillion transformative plan) infrastructure package passed in a bipartisan Senate vote, is just the beginning. The people who build roads and bridges, and the laborers they hire, will soon have more work than they can handle, and everyone will benefit from this much needed overhaul of the country’s physical infrastructure.
Wall Street never lost sight of this or the second piece of the Biden agenda, the human infrastructure, and confidence in its passage is baked into all those rising 401-Ks.
People with money are betting on Biden. Every president makes mistakes in his first year, and Biden let his party drift for too long before grasping the urgency of the task. That phase is nearing an end, and the legislation Wall Street is banking on will make 2022 politics look a lot different than they do now.
The Pandemic should be in the rear-view mirror, and the economy will be humming. The Virginia race will be a bellwether. McAuliffe says Trump is on the ballot in Virginia. Republican Glenn Youngkin, a wealthy private equity investor, embraced Trump when he needed him to win the primary, then distanced himself. Trump’s ego couldn’t stand that, so he inserted himself into the race praising Youngkin at a rally, unwittingly reminding Virginia voters why Trump lost Virginia by 10 points.
If Virginia is a referendum on Trump, the ex-president’s stand-in cannot win.
Douglas Cohn’s latest books are The President’s First Year: The Only School for Presidents Is the Presidency and World War 4: Nine Scenarios (endorsed by seven flag officers).
© 2021 U.S. News Syndicate, Inc.
Distributed by U.S. News Syndicate, Inc.
END WASHINGTON MERRY-GO-ROUND
IMMEDIATE RELEASE 22 October 2021