DONALD TRUMP has dominated the American right for nine years and yet, even after a decade of study, many observers still cannot fathom why. But voters are certainly not tired of Mr Trump. Even after the scandal and mayhem of his first term, culminating in his attempt to cling to power after losing the election in 2020, around half of the electorate, or some 75m Americans, will vote for him this time.
What accounts for his enduring strength? At first it was common on the left to point to racism, misogyny and xenophobia, sustained by misinformation and lies. Hillary Clinton infamously summarised this thesis. “To just be grossly generalistic, you could put half of Trump’s supporters into what I call the basket of deplorables,” she once said.
The early explanations from Mr Trump’s sympathisers could be equally simplistic and hysterical. In 2016 Michael Anton made the most prominent intellectual case for Mr Trump. He wrote that Americans needed to register a populist primal scream before their way of life was permanently extinguished, and called 2016 the “Flight 93 election” (referring to the plane hijacked on September 11th 2001 that crashed in a field in Pennsylvania after a passenger revolt). Mr Anton elaborated: “A Hillary Clinton presidency is Russian Roulette with a semi-auto. With Trump, at least you can spin the cylinder and take your chances.” Most Americans did not think 2016 was a Flight 93 election. In fact, 40% of eligible voters didn’t bother to express an opinion.
Calmer analysis is more helpful. Social scientists provide three kinds of explanation. Political scientists point out the importance of institutions; political economists put stress on material conditions; and political sociologists emphasise the cultural divide between elites and the self-described populus.
The first explanation, the political-science one, sees Mr Trump as a lucky beneficiary, or perhaps even a canny exploiter, of America’s peculiar political system. First-past-the-post voting, which awards elections to the candidate who commands a plurality, encourages a two-party duopoly. (When Mr Trump applied his talents to seek the nomination of the Reform Party in 2000, it did not end well.) Open primary elections have meant that rank-and-file members wield more power than party elites when selecting the presidential nominee. That allows a faction, as the Make America Great Again crowd could be called, to seize control of a major-party apparatus if it is successful enough.
Democrats had their own insurrectionary movements from the populist left in both 2016 and 2020, led by Bernie Sanders and then by Elizabeth Warren. But neither of them managed to capture the consistent 25-35% of primary voters that Mr Trump did in the early Republican primaries in 2016. Were European-style multiparty democracy to be transplanted to America, a Trump-led MAGA party might draw a lot of support without attracting a majority—like the hard-right Alternative for Germany.
Once in charge of the party, the two-party system works in favour of the rebellious faction, forcing co-partisans to make their peace with the new leadership. This explains a lot of Mr Trump’s support now. But the political-systems approach is less satisfying as an explanation for why his hold is so enduring, making him the first person to win a major party’s nomination three times in a row since Franklin Roosevelt.
Political economy—explanation number two—could throw light on part of this longevity. The American economy boomed during Mr Trump’s first term in office, up until the covid-19 pandemic. Although voters did not approve of Mr Trump’s conduct in office, and especially on January 6th 2021, when his supporters violently breached the Capitol, their anger over inflation and pessimism over the economy are pushing them to rebuke the incumbent Democrats, to the benefit of Mr Trump.
Evidence from outside America suggests there is a lot to this. Voters are in an anti-incumbent mood everywhere, rejecting the ruling parties in Britain, France, India and Japan (and presumably next year in Canada and Germany). But the idea that the economy is making people cross does not fit with what’s actually happening in America. The gap in output per person between Canada, western Europe and Japan on one side and America on the other has doubled since 1990. America’s economy is the envy of the world, with fast increases in real wages for the poorest workers. If inequality is the cause, that is hard to square with data showing wages rising in “left-behind” places and no increase in income inequality in the past decade.
That leaves a third genre of explanation: political sociology. Even though American politics has remained almost perfectly divided over the past decade, it has not been static. Voters are less divided by income or race than before; instead a striking new dividing line is educational class. Democrats increasingly attract the support of the professional, suburban managerial class who find Mr Trump repulsive and unfit for office; the working classes, including an increasing share of the non-white working class, admire that Mr Trump has made the right enemies, talks like them, talks to them, and promises them a future in which they receive dignity and their just financial desserts—even if they know that these promises are unlikely to be kept.
Visiting an area in North Carolina hit hard by flooding a few weeks ago, Mr Trump promised that under his rule every property that had been destroyed would be rebuilt, and more beautifully than before. Never mind that some of them are in areas prone to flooding and so will not be rebuilt. It was what people wanted to hear. One speaker who welcomed Mr Trump described his visit as the shot in the arm of hope that people needed, and said his visit guaranteed that people there would not be forgotten. To use the language of pop psychology, Mr Trump makes a lot of Americans feel seen. That he is happy to dress up in the uniform of a McDonald’s worker or a garbage-truck guy, despite being worth several billion dollars, helps too. Kamala Harris, who actually worked at McDonalds, seems to cringe at such stuff.
The realignment according to educational qualifications means that the most serious divide in America is over culture rather than money. Under Mr Trump, the Republican Party looks increasingly left-labour in its economics, advocating protectionism, working-class tax giveaways and preservation of the existing entitlement system. To many Americans without a college degree, Democrats no longer talk to them but down to them. That is why, despite being showered with dollars from the federal government under President Joe Biden, members of America’s industrial unions are moving towards Mr Trump this year. And it is why the Trump campaign seized on remarks by a befuddled Mr Biden a few days ago, in which he appeared to call Trump supporters “garbage”. “See: Democrats still think you are deplorables,” was their message.
Democrats—and a good number of former members of the Republican elite—genuinely wonder how it is that Mr Trump’s supporters so quickly dismiss his efforts to overturn a democratic election, or his poor record of achievement on policy in office, or the undermining of abortion rights which he engineered. Mr Trump’s supporters see these criticisms as overhyped. And they see them as hypocritical, pointing out that the legal system has in fact been weaponised against Mr Trump in a way that he merely threatens.
Culture means Democrats and Republicans live in different countries. Tens of millions of Trump voters (mistakenly) believe America is in a recession. They think Democrats brought on inflation when they managed the economy, which boomed under Trumponomics. They observe that there were no new wars launched when Mr Trump was in the White House. Under Mr Biden’s watch, there are security crises in the Middle East and Ukraine. Trumpism is a simple heuristic, just as Trump-loathing is. It could be powerful enough to take him back to the White House.
If you think Donald Trump is too crass or cruel or incompetent to be president—if you are disappointed or even astonished that, having tried and failed to subvert the will of the people in the last election, he has come back to win fair and square—you should be asking yourself this question: why, to so many Americans, does the Democratic Party seem worse?
This victory is a tremendous achievement for Mr Trump, who after his loss in 2020 and the attack on the Capitol on January 6th 2021 was counted out even by leaders of his own party. At the time Mitch McConnell, the Senate Republican leader, who privately regarded Mr Trump as “a sleazeball” and “stupid”, called the insurrection “further evidence of Donald Trump’s complete unfitness for office”, according to reporting he has not disputed in a new biography by Michael Tackett, a journalist.
Yet what might seem a psychological frailty—an inability to brook criticism or concede mistakes, much less defeat—has for Mr Trump been a mighty source of political strength, one that intensifies his connection to the voters he has made the base of the Republican Party. As in 2016, Mr Trump wielded his command of that bloc of voters this year to clear a path through crowded Republican primaries, and then relied upon “negative polarisation”, or fear of the other guys, to unite the party. “Can you believe he endorsed me?” Mr Trump chortled at a rally in North Carolina on November 3rd, gloating over how Mr McConnell eventually fell into line. Mr Trump felt no obligation to reciprocate. “Hopefully we get rid of Mitch McConnell pretty soon,” he said.
Mr Trump has shown courage, not only in weathering assassins’ attacks but in insisting on views on trade, entitlements and other matters that a few years ago were heresy within his party. With his sophisticated grasp of new and legacy media and his instinct for the basic needs and fears of many Americans, he has revolutionised how American politics is conducted and shifted the policy terrain over which it is waged. In terms of disrupting what came before, he has had more effect than even Ronald Reagan.
Unlike Reagan—or the other two-term presidents since, Bill Clinton, George W. Bush and Barack Obama—Mr Trump has never been very popular, though he managed, in this third run as the Republican nominee, at last to win the popular vote. Unlike those predecessors, Mr Trump has relied upon division, not addition, for his electoral maths. In his first term his average approval rating of 41% was the lowest ever measured by the Gallup Poll, which began tracking the statistic under Harry Truman. Democrats have good reason to think Mr Trump repels many voters when he calls adversaries “vermin” or “the enemy from within” or says illegal immigrants are “poisoning the blood of our country”.
Yet, after this victory, whatever disdain Democrats have for Mr Trump should be cause only for humility and self-scrutiny. As in 2016, Mr Trump’s broad support will present his adversaries with a Rorschach test in which they can see their preferred image of America, and it will be ugly. For some, white supremacy and misogyny will explain Mr Trump’s success, while others may attribute it to tax cuts and greed. Some will conclude that poor, non-white or female Americans have been ensorcelled into voting against their self-interest. Rather than retreat into some grand theory, they would so better ro think through how, in a divided country, President Joe Biden might have nudged the balance a few points away from Mr Trump, rather than to him. Kamala Harris was no bystander, but pime responsibility lies with the president she served.
Mr Biden did not heed his own warnings about Mr Trump. He tried to eat into Mr Trump’s support with blue-collar workers through giant investments in manufacturing and infrastructure that offered something to everyone. But, unlike Mr Clinton or Mr Obama, he ducked choices that would have respected the concerns of most Americans but disappointed left-wing Democrats. A political strategy of addition still requires some division.
Most egregious, Mr Biden resharpened Mr Trump’s most effective political wedge by doing away with obstacles he had created to illegal immigration, with no alternative. By the time he restored some of Mr Trump’s restrictions this spring, more than 4m migrants had crossed the southern border, compared with fewer than 1m under Mr Trump. That was terrible for the Democrats as a party, and worse for people they want to help and the cause they believe in: under Mr Biden, Americans who say they want a decrease in legal immigration rose from a minority to a majority, as did the number who favour mass deportation.
How to defend democracy
Even where Mr Biden had accomplishments that undermined Mr Trump’s arguments, he let himself be constrained by his party’s loudest activists. Oil production rose to record levels, but Mr Biden did not boast about that. He was also no longer up to the demands of presidential communication that Mr Trump understands so well. He was not constantly, energetically promoting his success in sustaining economic growth and raising wages. His approval rating sagged as low as 36% just asother Democrats were forcing him to face the obvious: he should not be running again. In the short time Ms Harris had, she waged a good campaign. But any politician would have struggled under such burdens. She could not separate herself enough from Mr Biden, or from the video Mr Trump’s ads used, to devastating effect, of her recently declaring positions that were alienating to most Americans.
“We have learned again that democracy is precious,” Mr Biden proudly declared during his inaugural address almost four years ago. “Democracy is fragile. And at this hour, my friends, democracy has prevailed.” Now it has prevailed again. Will Democrats get the message this time? ■
Federal Reserve Board Chairman Jerome Powell holds a press conference following a two-day meeting of the Federal Open Market Committee on interest rate policy in Washington, U.S., September 18, 2024. REUTERS/Tom Brenner
Tom Brenner | Reuters
The Federal Reserve likely will stick to the business at hand when it wraps up its meeting Thursday with another interest rate cut, but will have its eye on the future against a backdrop that suddenly has gotten a lot more complicated.
Financial markets are pricing in a near-certainty that the central bank’s Federal Open Market Committee will lower its benchmark borrowing cost by a quarter percentage point as it seeks to “recalibrate” policy for an economy that is seeing the inflation rate moderate and the labor market soften.
The focus, though, will turn to what’s ahead for Chair Jerome Powell and his Fed colleagues as they navigate a shifting economy — and the political earthquake of Donald Trump’s stunning victory in the presidential race.
“We think Powell will refuse to give any early judgment on the implications of the election for the economy and rates, and will seek to be a source of stability and calm,” Krishna Guha, head of global policy and central bank strategy at Evercore ISI, said in a a note issued before the election’s outcome was known.
In keeping with policymakers’ historical desire to stay above the political fray, Powell “will say the Fed will take the time it needs to study the new administration’s plans” then will “refine this assessment as actual policies are developed and enacted,” Guha added.
So while the immediate action will be to stay the course and enact the cut, which equals 25 basis points, the market’s attention likely will turn to what the committee and Powell have to say about the future. The fed funds rate, which sets what banks charge each other for overnight lending but often influences consumer debt as well, is currently targeted in a range between 4.75%-5.0%.
Market pricing currently favors another quarter-point cut in December, followed by a January pause then multiple reductions through 2025.
Preparing for Trump
But if Trump’s agenda — tax cuts, higher spending and aggressive tariffs — comes to fruition, it could have a meaningful impact on a Fed trying to right-size policy after the mammoth rate hikes aimed at controlling inflation. Many economists believe another round of isolationist economic moves from the president-elect could reignite inflation, which held below 3% during Trump’s entire first-term despite a similar recipe.
Trump was a frequent critic of Powell and the Fed during his term, which ran from 2017-21, and is in favor of low interest rates.
“Everyone is on the lookout for future rate cuts and whether anything is telegraphed,” said Quincy Krosby, chief global strategist at LPL Financial. “Also, however, there’s the question of whether or not they can declare victory on inflation.”
Any answers to those questions would be largely left to Powell’s post-meeting news conference.
Though the committee will release its joint decision on rates, it will not provide an update on its Summary of Economic Projections, a document issued quarterly that includes consensus updates on inflation, GDP growth and unemployment, as well as the anonymous “dot plot” of individual officials’ interest rate expectations.
Beyond the January pause, there’s considerable market uncertainty about where the Fed is heading. The SEP will be updated next in December.
“What we’re going to hear more and more of is the terminal rate,” Krosby said. “That’s going to come back into the lexicon if yields continue to climb higher, and it’s not completely associated with growth.”
So where’s the end?
Traders in the fed funds futures market are betting on an aggressive pace of cuts that by the close of 2025 would take the benchmark rate to a target range of 3.75%-4.0%, or a full percentage point below the current level following September’s half percentage point cut. The Secured Overnight Financing Rate for banks is a bit more cautious, indicating a short-term rate around 4.2% at the end of next year.
“A key question here is, what’s the end point of this rate cut cycle?” said Bill English, the Fed’s former head of monetary affairs and now a finance professor at the Yale School of Management. “Fairly soon, they’ve got to think about, where do we think this rate cut period changes with the economy looking pretty strong. They may want to take a pause fairly soon and see how things develop.”
Powell also may be called on to address the Fed’s current moves to reduce the bond holdings on its balance sheet.
Since commencing the effort in June 2022, the Fed has shaved nearly $2 trillion off its holdings in Treasurys and mortgage-backed securities. Fed officials have said that the balance sheet reduction can continue even while they cut rates, though Wall Street expectations are for the run-off to end as soon as early 2025.
“They’ve been happy to just kind of leave that percolating in the background and they probably continue to do that,” English said. “But there’s going to be a lot of interest over the next few meetings. At what point do they make a further adjustment to the pace of runoffs?”
IT IS AN extraordinary comeback—or, as Donald Trump triumphantly put it in West Palm Beach, Florida, in the early hours of November 6th, “a political victory that our country has never seen before”. After losing four years ago he has survived impeachment, conviction as a felon, numerous other indictments and two assassination attempts, and will become America’s 47th president, to add to his stint as the 45th. He becomes the oldest man ever to win the White House.
Many had expected a long wait for the result of an extremely close election to become clear. In the event, the outcome was evident within hours. Mr Trump looked set to win all seven of the critical swing states: he triumphed in North Carolina, Georgia, Pennsylvania and Wisconsin, and had strong leads in Michigan, Arizona and Nevada. That translates into a decisive advantage in the electoral college.
It appears that Mr Trump was able to draw support from both urban and rural voters at levels notably higher than in his contest against Joe Biden in 2020. In state after state, Mr Trump performed better than he had in 2020. In Florida, for example, where he won by three percentage points last time, his margin is on track to surge to 12 points. And although opinion-poll aggregates had consistently shown Kamala Harris to be ahead in the national popular vote, it seems that Mr Trump may have won that too. Just as in 2016 and 2020, in other words, the polls underestimated Mr Trump’s support.
What went wrong for Ms Harris? For one thing, her advantage among women voters, on whom Democrats were pinning their hopes, turned out to be smaller than expected. The gender gap, between the votes of men and women, actually narrowed, from 23 points in 2020 to 20, according to exit polls. Among Hispanic voters, Mr Trump made striking inroads, improving his margin by ten percentage points compared with 2020, according to CNN’s exit poll. The trend was particularly strong among Hispanic men: Joe Biden won their vote by a margin of 23 points; this time Mr Trump was on track to prevail among them by a margin of ten points. More broadly, dissatisfaction with high inflation and immigration contributed to a sense among voters that the country was on the wrong track, for which they naturally blame the incumbent. Much as Ms Harris sought to present herself as the candidate of change, she was stuck with her association with the current administration.
As well as the White House, the Republicans also wrested back control of the Senate. It was always going to be hard for Democrats to hold on to their slender majority in that chamber, given that they were defending a disproportionate number of seats (a third of which are up for election in each election cycle). Not only did Republicans take the vacant seat in West Virginia, as expected; they also flipped Ohio and Montana and prevailed in a close contest in Nebraska. The upsets Democrats hoped for in Florida and Texas failed to materialise. Republican control of the Senate smooths the way for Mr Trump to make important appointments—from cabinet secretaries to generals to Supreme Court justices—that require Senate confirmation.
Whether the Republicans complete their sweep by retaining control of the House of Representatives is still not clear. Results in California, to arrive later, will determine that. But Mr Trump, in his victory speech, was confident that the House would be his, too.
“This will truly be the golden age of America,” he declared. Few will question that the country is indeed entering a new age. Whether Mr Trump will truly “heal” America, as he promised, is more debatable. Beyond America’s borders, too, the consequences are momentous. From tariffs to climate change to Ukraine, the world must brace itself for Trump II.■