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More people live in Florida than in New York state, where the budget is nearly twice as big. From kindergarten through high school New York spends more than twice as much as Florida to educate each pupil, yet eighth-graders in both states score comparably on standardised tests, and Florida achieves higher high-school graduation rates, particularly for black and Hispanic students. Florida is building homes faster and, along with cheaper housing, it has a higher rate of home ownership and a lower incidence of homelessness than New York. At 3.1% in December, the unemployment rate was a third lower in Florida.
Florida has its relative demerits, including more people without health insurance and a higher rate of homicide. But for its services the state charges its citizens no income tax, whereas New York imposes some of the highest rates in the country. Corporate taxes are also lower in Florida. Overall, Americans are concluding the balance favours Florida: its population grew by another 365,000 last year, while New York’s shrank by 102,000, continuing a four-year trend.
All of which is to say that Democrats should be grateful that Governor Ron DeSantis of Florida, for reasons of conviction or perceived political interest, proved to be such a ferocious culture warrior. Had he been capable of running his state, and running for president, as a sunny champion of low-cost, effective government—the kind of candidate for whom reasonable people in both parties yearn—who knows how far he might have gone, and how little hope Democrats in Florida might have of ever clawing their way back to political daylight.
True, they are in a deep hole. From an advantage of 260,000 registered voters when Donald Trump took office in 2017, Democrats were trailing by almost 800,000 by December. That swing came thanks to bad candidates and feeble organising in the face of a disciplined Republican operation. Failure begat more failure as donors closed their chequebooks. Republicans now hold all elected statewide offices and a supermajority in the legislature.
But Florida politicos of both parties think Mr DeSantis weakened himself with his oafish presidential bid. Because of Florida’s term limits, he cannot run for governor again and so has less political leverage than he once did. In January Democrats flipped a state-House district in central Florida that a Republican carried easily in 2022. The Democrat there, a navy veteran, stressed bread-and-butter issues and protecting the right to abortion, whereas his opponent inveighed against “the woke mob”. Democrats also did the hard work to turn out the vote that they had been neglecting.
Democrats were further heartened by the uproar last month after a teacher in Miami-Dade County sent a permission slip home asking parents to authorise the reading of “a book written by an African-American”, as part of Black History Month. Mr DeSantis testily insisted no such slip was required under his parental-notification law, known as the “Stop WOKE Act”. But other news reports have described the frustration of teachers and parents over having to fill out new forms for pupils to hear from speakers such as a Holocaust survivor.
The politics of abortion will supply the surest indication of whether one-party rule has led Mr DeSantis to overreach, as Democrats have at times in Democratic states like New York. In his first term Mr DeSantis signed a ban on abortion after 15 weeks of pregnancy. After he got the supermajority in 2022 and set his sights on the White House, he signed a six-week ban. Neither is in effect because the state Supreme Court is reviewing the 15-week ban. If the court upholds it, the six-week limit would take effect a month later. Polling suggests even most Republicans oppose it.
Early this year opponents of the ban produced the 891,000 signatures required to put a referendum on the ballot this autumn to protect abortion until about 24 weeks. They overcame new obstacles imposed by the legislature by mobilising some 10,000 volunteers. The referendum is also before the state Supreme Court.
Florida is not a swing state this year, though President Joe Biden will probably try to bait Mr Trump into spending money there. State Democrats are looking beyond Mr Biden and Mr Trump. (Isn’t it reassuring that some people are?) They want to rebuild their voter base and political bench with an eye to 2028 and beyond. With north Florida solidly red, the state party is focusing on central and south Florida, in particular the most populous county, Miami-Dade. In a sign of how serious the Democrats’ problems are, and of how seriously the leadership takes them, the state party leader in early March suspended three local party chairmen she thought were underperforming, including in Miami-Dade.
Night and Dade
The party is embarking on a voter-registration drive in Miami-Dade. Operatives point to one Democratic candidate for county office there whose father was kidnapped by leftist Colombian guerrillas, and another whose family fled from Cuba, as evidence that Democrats have learned from their damaging dalliance with Bernie-Sanders-style “socialism”. They are also resisting putting causes like LGBTQ rights front and centre, having seen how that can backfire. “All we’ve done in the last two years is take the trans community and, worse, trans kids, and put them on the radar of Republicans to be shot at,” says one experienced Democratic strategist. He says Democrats instead need to emphasise protecting freedoms for everyone—and stop using terms like “LatinX”, which irritates many Latino voters, among others.
Republican electoral successes in New York have prompted Democratic leaders to press back against some excesses of their own one-party rule. Whether or not Florida ever becomes a presidential swing state again, its citizens would benefit from a return to the intense, respectful partisan competition that provided Mr DeSantis with the happy story he did such a poor job of telling. ■
The struggling German economy has been a major talking point among critics of Chancellor Olaf Scholz’ government during the latest election campaign — but analysts warn a new leadership might not turn these tides.
As voters prepare to head to the polls, it is now all but certain that Germany will soon have a new chancellor. The Christian Democratic Union’s Friedrich Merz is the firm favorite.
Merz has not shied away from blasting Scholz’s economic policies and from linking them to the lackluster state of Europe’s largest economy. He argues that a government under his leadership would give the economy the boost it needs.
Experts speaking to CNBC were less sure.
“There is a high risk that Germany will get a refurbished economic model after the elections, but not a brand new model that makes the competition jealous,” Carsten Brzeski, global head of macro at ING, told CNBC.
The CDU/CSU economic agenda
The CDU, which on a federal level ties up with regional sister party the Christian Social Union, is running on a “typical economic conservative program,” Brzeski said.
It includes income and corporate tax cuts, fewer subsidies and less bureaucracy, changes to social benefits, deregulation, support for innovation, start-ups and artificial intelligence and boosting investment among other policies, according to CDU/CSU campaigners.
“The weak parts of the positions are that the CDU/CSU is not very precise on how it wants to increase investments in infrastructure, digitalization and education. The intention is there, but the details are not,” Brzeski said, noting that the union appears to be aiming to revive Germany’s economic model without fully overhauling it.
“It is still a reform program which pretends that change can happen without pain,” he said.
Geraldine Dany-Knedlik, head of forecasting at research institute DIW Berlin, noted that the CDU is also looking to reach gross domestic product growth of around 2% again through its fiscal and economic program called “Agenda 2030.”
But reaching such levels of economic expansion in Germany “seems unrealistic,” not just temporarily, but also in the long run, she told CNBC.
Germany’s GDP declined in both 2023 and 2024. Recent quarterly growth readings have also been teetering on the verge of a technical recession, which has so far been narrowly avoided. The German economy shrank by 0.2% in the fourth quarter, compared with the previous three-month stretch, according to the latest reading.
Europe’s largest economy faces pressure in key industries like the auto sector, issues with infrastructure like the country’s rail network and a housebuilding crisis.
Dany-Knedlik also flagged the so-called debt brake, a long-standing fiscal rule that is enshrined in Germany’s constitution, which limits the size of the structural budget deficit and how much debt the government can take on.
Whether or not the clause should be overhauled has been a big part of the fiscal debate ahead of the election. While the CDU ideally does not want to change the debt brake, Merz has said that he may be open to some reform.
“To increase growth prospects substantially without increasing debt also seems rather unlikely,” DIW’s Dany-Knedlik said, adding that, if public investments were to rise within the limits of the debt brake, significant tax increases would be unavoidable.
“Taking into account that a 2 Percent growth target is to be reached within a 4 year legislation period, the Agenda 2030 in combination with conservatives attitude towards the debt break to me reads more of a wish list than a straight forward economic growth program,” she said.
Franziska Palmas, senior Europe economist at Capital Economics, sees some benefits to the plans of the CDU-CSU union, saying they would likely “be positive” for the economy, but warning that the resulting boost would be small.
“Tax cuts would support consumer spending and private investment, but weak sentiment means consumers may save a significant share of their additional after-tax income and firms may be reluctant to invest,” she told CNBC.
Palmas nevertheless pointed out that not everyone would come away a winner from the new policies. Income tax cuts would benefit middle- and higher-income households more than those with a lower income, who would also be affected by potential reductions of social benefits.
Coalition talks ahead
Following the Sunday election, the CDU/CSU will almost certainly be left to find a coalition partner to form a majority government, with the Social Democratic Party or the Green party emerging as the likeliest candidates.
The parties will need to broker a coalition agreement outlining their joint goals, including on the economy — which could prove to be a difficult undertaking, Capital Economics’ Palmas said.
“The CDU and the SPD and Greens have significantly different economic policy positions,” she said, pointing to discrepancies over taxes and regulation. While the CDU/CSU want to reduce both items, the SPD and Greens seek to raise taxes and oppose deregulation in at least some areas, Palmas explained.
The group is nevertheless likely to hold the power in any potential negotiations as it will likely have their choice between partnering with the SPD or Greens.
“Accordingly, we suspect that the coalition agreement will include most of the CDU’s main economic proposals,” she said.