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How does Ron DeSantis dropping out change the Republican primary?

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Editor’s note (January 21st 2024): This story was updated after Ron DeSantis said he was suspending his campaign for the Republican nomination.

RON DESANTIS’S campaign ended, as it began, on X. His live launch event was meant to show how au fait with the future the Florida governor was. Instead the glitchy launch turned into the equivalent of dad dancing. Mr DeSantis took no such chances with his withdrawal from the Republican primary, which he announced in a video posted on the same platform. As a final act of self-degradation he endorsed Donald Trump, who has been bullying him for months about his height and his table manners.

That leaves just two candidates standing: Mr Trump and Nikki Haley. Ms Haley’s hopes hinge on the tiny state of New Hampshire, which votes on January 23rd. Though only three of the past eight winners of a competitive Republican Iowa caucus have gone on to win their party’s nomination, New Hampshire has voted for six eventual nominees. Ms Haley hopes to become the seventh. Mr DeSantis’s departure is unlikely to make a hard task any easier.

Her campaign is right to bet on New Hampshire. Ms Haley’s base—independent, moderate and college-educated voters—makes up an unusually large share of the state’s primary electorate. But the promise New Hampshire offers is also why Ms Haley finds herself in a bind. Although a triumph in the Granite State could give her a lift, the electorate across the remaining key states in the Republican primary is more religious, less educated and as a result far Trumpier. The coalition she has crafted to be competitive in New Hampshire will be hard, perhaps impossible, to recreate elsewhere.

Image: The Economist

A Republican non-incumbent candidate has never won both Iowa and New Hampshire in the party’s primary. But judging by the latest polling Donald Trump, ever the disruptor, looks set to make history. He leads Ms Haley in the state by 15 points; Mr DeSantis had sunk to single figures (see chart 1). In a Republican primary marked by candidates fighting for second place (the former president leads nationally by 55 points), the Haley campaign reckons her smaller deficit in New Hampshire is surmountable. A month before the Iowa caucuses Mr Trump’s lead in the state was nearly double what it is today. Her campaign and allied super PACs have bombarded New Hampshire’s airwaves with ads, spending twice as much as Mr Trump and a bit more than three and a half times as much as Mr DeSantis, who finished just above Ms Haley in Iowa on January 15th (chart 2).

Image: The Economist

Now he is no longer in the race, where will his voters go? The Economist’s YouGov poll, taken earlier in January, asked Republican primary voters about their second preferences. The race may have moved since, and the poll was taken before Vivek Ramaswamy dropped out, but the numbers are still instructive. Among first choice DeSantis voters in that survey, 44% said Mr Trump would be their second choice. Only 24% said they would vote for Ms Haley. The sample is small, so aim off for that. But the reason the sample is small is that there are so few DeSantis voters in the poll.

If Ms Haley wins in New Hampshire it will be in no small part thanks to the state’s open primary rules and, to a lesser extent, a kink in the Democratic primary. Unaffiliated voters, not just Democrats and Republicans, can take part in one of New Hampshire’s primaries. This year some independents will have little choice but to vote in the Republican one because New Hampshire (living up to its state motto “live free or die”) has rendered the Democratic Party’s primary obsolete. In an effort to make the set of states that vote earlier in the primary process more reflective of the Democratic Party’s voters, the Democratic National Committee (DNC) moved the state’s primary to follow or coincide with those of South Carolina and Nevada, which have more non-white voters. But New Hampshire state law requires its primaries to be the first in the country. As a result, the contest on Tuesday is not formally recognised by the DNC, and Joe Biden is not on the ballot.

This is fortunate for Ms Haley. Independents in New Hampshire back her by a 15-point margin. According to poll estimates, they are expected to account for nearly half the state’s primary electorate, compared with 30% in 2016. However, other states with open Republican primaries will have a corresponding Democratic primary to siphon off independents. Such is the case in South Carolina, Ms Haley’s home state. According to a poll taken in early January, although independents there support her by a four-point margin, they make up only an estimated one-quarter of the state’s Republican-primary electorate. And because Mr Trump’s grip on the remaining three-quarters of South Carolina’s electorate is so strong (they back him by three to one), the overall gap between Ms Haley and the former president was a canyonesque 29 points before Mr DeSantis dropped out. For her four-point advantage among independents to outweigh her 41-point deficit among Republicans, independents would need to make up 91% of the South Carolina electorate. They do not.

Just possibly she could win New Hampshire’s Republican primary on the backs of independents, but she cannot win the nomination with this formula. So winning alone is not enough; rather, Ms Haley needs to show marked improvement among the party faithful if her candidacy is to remain viable. She failed to surge among Republicans in Iowa and polling suggests it will be a tall order in New Hampshire, too. According to a Suffolk University poll, nearly half of Ms Haley’s would-be voters there say they are casting their ballot against Donald Trump, rather than in support of her. In contrast, 93% of Mr Trump’s supporters say they are voting for him, not against Ms Haley. MAGA voters’ support seems to be set in granite.

Economics

Donald Trump has many ways to hurt Elon Musk

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THERE WAS a time, not long ago, when an important skill for journalists was translating the code in which powerful people spoke about each other. Carefully prepared speeches and other public remarks would be dissected for hints about the arguments happening in private. Among Donald Trump’s many achievements is upending this system. In his administration people seem to say exactly what they think at any given moment. Wild threats are made—to end habeas corpus; to take Greenland by force—without any follow-through. Journalists must now try to guess what is real and what is for show.

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Economics

Donald Trump has many ways to hurt Elon Musk

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THERE WAS a time, not long ago, when an important skill for journalists was translating the code in which powerful people spoke about each other. Carefully prepared speeches and other public remarks would be dissected for hints about the arguments happening in private. Among Donald Trump’s many achievements is upending this system. In his administration people seem to say exactly what they think at any given moment. Wild threats are made—to end habeas corpus; to take Greenland by force—without any follow-through. Journalists must now try to guess what is real and what is for show.

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Economics

Jobs report May 2025:

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U.S. payrolls increased 139,000 in May, more than expected; unemployment at 4.2%

Hiring decreased just slightly in May even as consumers and companies braced against tariffs and a potentially slowing economy, the Bureau of Labor Statistics reported Friday.

Nonfarm payrolls rose 139,000 for the month, above the muted Dow Jones estimate for 125,000 and a bit below the downwardly revised 147,000 that the U.S. economy added in April.

The unemployment rate held steady at 4.2%. A more encompassing measure that includes discouraged workers and the underemployed also was unchanged, holding at 7.8%.

Worker pay grew more than expected, with average hourly earnings up 0.4% during the month and 3.9% from a year ago, compared with respective forecasts for 0.3% and 3.7%.

“Stronger than expected jobs growth and stable unemployment underlines the resilience of the US labor market in the face of recent shocks,” said Lindsay Rosner, head of multi-sector fixed income investing at Goldman Sachs Asset Management.

Nearly half the job growth came from health care, which added 62,000, even higher than its average gain of 44,000 over the past year. Leisure and hospitality contributed 48,000 while social assistance added 16,000.

On the downside, government lost 22,000 jobs as efforts to cull the federal workforce by President Donald Trump and the Elon Musk-led Department of Government Efficiency began to show an impact.

Stock market futures jumped higher after the release as did Treasury yields.

Though the May numbers were better than expected, there were some underlying trouble spots.

The April count was revised lower by 30,000, while March’s total came down by 65,000 to 120,000.

There also were disparities between the establishment survey, which is used to generate the headline payrolls gain, and the household survey, which is used for the unemployment rate. The latter count, generally more volatile than the establishment survey, showed a decrease of 696,000 workers. Full-time workers declined by 623,000, while part-timers rose by 33,000.

“The May jobs report still has everyone waiting for the other shoe to drop,” said Daniel Zhao, lead economist at job rating site Glassdoor. “This report shows the job market standing tall, but as economic headwinds stack up cumulatively, it’s only a matter of time before the job market starts straining against those headwinds.”

The report comes against a teetering economic background, complicated by Trump’s tariffs and an ever-changing variable of how far he will go to try to level the global playing field for American goods.

Most indicators show that the economy is still a good distance from recession. But sentiment surveys indicate high degrees of anxiety from both consumers and business leaders as they brace for the ultimate impact of how much tariffs will slow business activity and increase inflation.

For their part, Federal Reserve officials are viewing the current landscape with caution.

The central bank holds its next policy meeting in less than two weeks, with markets largely expecting the Fed to stay on hold regarding interest rates. In recent speeches, policymakers have indicated greater concern with the potential for tariff-induced inflation.

“With the Fed laser-focused on managing the risks to the inflation side of its mandate, today’s stronger than expected jobs report will do little to alter its patient approach,” said Rosner, the Goldman Sachs strategist.

Friday also marks the final day before Fed officials head into their quiet period before the meeting, when they do not issue policy remarks.

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