Is It Possible The Biden Team Knows What They're Doing?

Six months ago, the fundamentals for Biden's re-election struck me as grim....against any potential Republican rival including Donald Trump.  But as of July 2023, I have to say that the incumbent is holding a much better hand than I anticipated a year out of the general election campaign.  For a variety of factors, I still anticipate the election will be nail-bitingly close and a Republican could sneak into the White House even if the national fundamentals continue improving in a straight line, but it can't be denied that several of Biden's biggest vulnerabilities at this point seem defused.  In some cases, it might be dumb luck that's keeping his Presidency alive, but if I'm a modestly informed swing voter looking at where we are today compared to where we were a year ago or even six months ago, I'd be hard-pressed to argue on behalf of a course correction.

Without question, the most pleasant surprise is the standing of the American economy.  Last year at this time, inflation was approaching double-digit percentages with soaring energy prices largely brought about by Putin's war.  The Federal Reserve seemed completely beyond its depth in terms of interest rate management, having waited six months after the onset of suffocating inflation to even begin combating it with interest rate hikes.  After 15 years of a cheap money policy with interest rates near zero, the Fed seemed detached from the reality that the world had changed until it was too late, and then had to overcorrect with multiple hikes per year that seemed almost certain to plunge us into a recession.  Or so it seemed....

Somehow, even after 10 consecutive interest rate hikes over the last 18 months, economic demand has remained robust enough that it's canceling out the downsides of the rate hikes.  The recession that seemed inevitable at the beginning of the year seems considerably less likely now.  And if there had been a recession in the second half of 2023, electoral history suggests it would have been lights out for Biden's Presidency in the second half of 2024.  Again, this could well have been luck on behalf of Biden and his team, stumbling their way into good outcomes despite themselves, Mr. Magoo style, but amateurs like myself can't dismiss entirely the possibility that they knew a few things their vocal critics didn't.

Last summer, I conceded that I thought the 2021 stimulus was a mistake, spraying a fire hose of cash into a post-COVID economy that was already in recovery and setting it up to overheat.  I suppose the jury's still out on that, but a generous assessment on behalf of the Biden team is that they knew we were poised to have inflation in the aftermath of COVID but were willing to endure a year or two of inflation to keep unemployment rates low, knowing that it would be quicker and easier to choke off inflation than it would be to lose a generation of young workers to an economy that recovered too slowly, which we experienced after the 2008 recession.

If that was indeed the bet, it's increasingly looking like it was a wise one.  Inflation rates that were at 9% a year ago are under 4% now, lower than most other places in the world, with even more tangible relief for consumers at the gas pump and the meat counter.  Meanwhile, the unemployment rate remains at historic lows, giving Biden a pretty good story to tell to voters next year if things don't blow up on him in the next 12-16 months.

Another huge Biden vulnerability months ago also appears to have lost considerable steam, and that's the chaos on the border.  Granted, Biden basically dusted off Trump's 2019 playbook and repurposed it for 2023, but the results are both surprising and hard to deny as of July 2023, with border crossings down 40%.  Maybe the reduction in border crossings has more to do with it being a particularly hot July in Mexico and South Texas than any tangible policy victories and the numbers will surge again come fall, but pretty much right around the time Biden's critics were predicting an unprecedented surge, the numbers started coming down and have kept going down.  The ebb and flow of asylum pursuit has always been tough to predict, but for Biden to get "chaos on the border" out of the headlines for as long as he has is pretty impressive considering the delusional place his administration came from early in his Presidency, when his policies and rhetoric welcomed de facto lawlessness on the border to appease the unhinged cultural left.

The dark irony for Biden is that the public doesn't seem to be noticing how comparatively smoothly things are going right now.  His numbers on both the economy and immigration remain deeply underwater.  Particularly on the economy, voters have come to expect things to always be perfect lest they believe we're in a recession, posing an increasing challenge for incumbent Presidents generally given that exit polls have shown voters to believe we're in a recession every election night since 2000, when in fact we were in one only once in 2008.  And Biden's challengers will be quick to disingenuously remind consumers that gas was $1.50 per gallon when he assumed the Presidency, cleverly failing to present it with the context that most air travel and the majority of automobile travel was sidelined because of the COVID recession when gas prices were at historic and unsustainable 2020 lows.

Certainly Biden will take advantage of opportunities to make a clearer case for his administration's successes in the year to come, at least if current favorable trends continue, and will likely convince a fair number of Trump-averse voters still giving Biden weak marks on the economy.  Nonetheless, any kind of setback to the current narrative will be highly problematic, and the looming UPS strike looms as a high-profile example of a risk to the fragile economic ecosystem.

Let's assume, for the sake of argument, that Biden continues to hold a winning hand next year at this time.  There's still almost no chance of his getting the kind of re-election mandate that Reagan or Clinton got overseeing their insurgent economies as the country is just too polarized.  Biden will remain an unthinkable option to at least 47% of Americans based on the tribal fault lines fomented by the toxic culture wars as well as the legacy of choices he's made, at least in the recent past, to align himself with his party's donor class on issues such as immigration and crime that have separated a huge chunk of the Clinton and even Obama coalition from ever considering the Democratic Party again in the foreseeable future.

But Biden remains uniquely vulnerable for a few reasons specific to him, namely the intertwined matters of his age and his Vice President.  Biden is almost 81 years old and seems older than that.  He'll be under a close microscope looking for any additional signs of cognitive decline for the next 16 months, and rightly so given his choice to pursue re-election.  Very few people can imagine him as being a functional head of state five years from now, but his re-election would require him to be.  Meanwhile, virtually nobody seems to think Vice President Kamala Harris is up to the job in his absence as she's managed to leave a sour taste in the mouth of even her most steadfast defenders 3-4 years ago.  

And worst of all, the Biden team's credible narrative of governing competence that I've outlined above is deeply undermined by the original selection of Harris as his Vice President.  It becomes harder for Biden and his team to credit themselves as uniquely capable of figuring complicated matters out when the most fundamental choice they made, and stand poised to double down on next year, was to select Harris as second in command.  The fact that Harris's selection was so cynically and obviously made based on the identity boxes she checked undermines the entire concept of competent governance.  Imagine on the debate stage where Biden ticks off all of his governing successes and the list of improving national fundamentals as bullet points for his administration's great decision-making, but Trump or any other GOP challenger simply responds with "....but you picked Kamala Harris as your successor to lead the country".  I suspect that with the majority of American voters, Trump or the GOP challenger would be decided to have won that hypothetical exchange.

Ultimately, my mid-year conclusion is that Biden seems a fair bit more likely to be re-elected than I'd have expected at the beginning of the year.  With Trump's mounting legal woes, Biden seems like he'd be a favorite against Trump, although I never underestimate that man's messaging skill and his uncanny ability to drag every bumpkin from every backwater to the voting booth and skew the polls in one swing state after another.  But I'm not as convinced as most that Trump is a shoo-in for the nomination, and I think most of the other contenders would pose a serious challenge to Biden in the general election.  The Republican Party has been Trump's party for four election cycles now, pushing center-right suburban voters to the Democratic Party a little more each cycle.  But if Trump is denied the nomination, the party gets a fresh start to define itself in a way that could win back those center-right suburbanites that went for Romney in 2012.  The fact that Ron DeSantis polls a few points better than Trump in a hypothetical against Biden, usually either tying or beating Biden, is a wake-up call to just how vulnerable Biden is even against a challenger who is nobody's idea of a centrist.  

The old guy badly needs Trump to not go away and he badly needs more favorable economic and immigration headlines if he wants to take another Oath of Office in January 2025.  Thus far in 2023, Biden has probably gotten what he needs to thread the needle.  Now it's time to hold our collective breath and hope no crosswinds blow him, or us, off the tightrope in the next year and a half.