Economics

Joe Biden’s weakness among Latinos threatens his re-election

Published

1 year ago

March 31, 2024

Business Finance News

In Arizona, a growing Hispanic electorate should help Democrats. Yet Donald Trump is gaining ground

Image: Caitlin O’Hara

Mar 18th 2024 | Phoenix and Tucson

Ruben Gallego, a Democrat, first won elected office in Arizona in 2010, a time of fierce battles over immigration. That year, Republicans passed SB1070, known as the “show me your papers” law, which required state police to ask individuals they suspected of being undocumented to provide proof of their status. Joe Arpaio, the publicity-minded sheriff in Arizona’s most populous county, recruited right-leaning Hollywood actors to a “posse” he formed to track down illegal migrants. Although the Supreme Court struck down most of SB1070’s provisions and voters ousted Mr Arpaio in 2016, “those scars aren’t going away,” says Mr Gallego, now a congressman running for an open Senate seat. He says the legacy of Latino activism from the Arpaio era may explain why, in 2020, Arizona Latinos voted for Joe Biden in higher numbers than Latinos nationally did, helping to deliver Mr Biden a narrow 10,000-vote victory in the state.

Yet Donald Trump is once again testing Democrats’ assumptions. He gained some 90,000 Latino voters in Arizona between 2016 and 2020 despite having pardoned Mr Arpaio for a criminal-contempt conviction, calling him an “American patriot” who “kept Arizona safe”. And if current polling is anything to go by, Mr Trump looks set to cut further into Mr Biden’s margins with Latino voters come November.

The Latino electorate is growing unusually fast and a majority still prefers Democrats. Of the six swing states likely to decide the presidential election in November (the other five being Georgia, Michigan, Nevada, Pennsylvania and Wisconsin), Arizona has the largest share of Latino voters. Mr Trump is clearly gaining popularity among Hispanics. However, current polling suggests that Latino voters still prefer Democrats overall, just by a smaller margin than in the past—meaning that it is Mr Biden who will benefit from the growth in Latino voters. The outcome in Arizona will depend largely on the race between these two trends.

The Arizona contest reflects fluidity in the national Latino vote. The group has never constituted a political monolith. It includes both Florida’s right-leaning refugees from Cuba’s socialist dictatorship and California’s proud leftist heirs to Chicano activism. Yet because, on average, Latino voters came to America more recently than non-Hispanic white and black Americans, they are less likely to have inherited a strong party affiliation from their parents or grandparents. They also “are more likely to hold what political scientists call cross-cutting identities”, or traits more commonly found among people outside one’s political tribe, says Samara Klar, a political scientist at the University of Arizona in Tucson. An evangelical Democrat might sound like an oxymoron but half of evangelical Latinos say the Democratic Party represents their interests. Because of cross-cutting identities, “Latino voters know a lot more people from the other party and they’re less hostile” towards them, notes Dr Klar.

Latinos also tend to have less extreme views. Compared with white Americans, they are less likely to identify as very conservative or very liberal. In a recent YouGov/The Economist poll one in seven said they do not know where they fall on the political spectrum, three times the number of white Americans who said the same.

Given these attributes, it should be little surprise that although Latinos as a whole lean Democratic, millions have voted for Republican candidates. Exit polls suggest that as far back as 1984 Ronald Reagan won some 37% of the Latino vote. By 2004 George W. Bush’s approximate 40% share was a high-water mark that even Mr Trump has yet to achieve.

Democrats have assumed at their peril that Latinos are a natural constituency and share many of the party’s (increasingly) progressive preferences. “Latinos are not the black vote and Democrats just don’t understand that,” says Mike Madrid, a veteran Republican strategist. Yet Republicans have at times fallen into the same trap, assuming that Latinos leaned so Democratic that courting them was futile. “There were no Latino organisers in the Republican Party for 30 years,” adds Mr Madrid.

That has changed. In 2020 Republicans made gains with Latinos across the board. Voter profiles from Catalist, a political-data firm that helps Democrats, show that although Democrats won Latinos outright, Republicans increased their vote share among all subgroups of Latino voters. Their strides were especially large with non-college-educated Latinos. They swung 11 percentage points to the right between 2016 and 2020. Republicans also gained six points among college-educated Latinos. And while Mr Trump did not generally make notable gains among young voters between 2016 and 2020, young Latinos lurched to the right. Mr Trump’s share of votes from 18- to 29-year-old Latinos increased from 21% to 31%.

Some of this Republican momentum might be a reversion to the mean. Latino support for Barack Obama, the first minority nominee, and Hillary Clinton, the first female one, may have been unusually strong. Without Mrs Clinton to inspire them, Latinas swung towards Mr Trump by 12 percentage points in 2020. But why else did Republican gains materialise in such a pronounced way in 2020?

Top: A Phoenix food vendor who declined to be named said he intends to vote for Donald Trump in 2024.
Bottom: Arizona State University student Jazlyn Gonzalez, 19, said that while the US presidential vote in November “is really important”, she is as yet undecided about her choice. Image: Caitlin O’Hara

Covid may have been a factor. The disease disproportionately killed Latinos and strained their incomes. Some 24% of Latinos were employed as low-income front-line workers, more than any other race or ethnicity. About one in four new businesses are Hispanic-owned. So although Democrats’ focus on lockdowns and containing the disease may have saved many Latinos’ lives, it was perceived as threatening their livelihoods. Meanwhile, Mr Trump and Republican governors across the country advocated for fewer restrictions and a swift return to normal. According to a report by Equis Research, an outfit that studies Latino political behaviour, “Latino voters saw the 2020 election as a referendum on the economy…in a way they hadn’t in 2016.”

About 85% of Arizona’s Latino voters trace their origins to Mexico, a cohort whose views typically track Latino national averages. Yet whereas Democrats’ lead over Republicans among Latinos shrank by 16 points nationally in 2020, in Arizona their lead narrowed by only 9.6 points. Had Mr Trump performed among Arizona Latinos as he did nationally he would have won the state. His prospects have improved since then. Even after accounting for Democrats’ strength in Arizona, current polling suggests Mr Biden’s chances of winning the state in November are on a knife’s edge.

Holding constant the advantage Democrats had among Latinos in Arizona in 2020, Mr Biden is currently up by 17 percentage points among Latinos in the state, an 8.4-point shift to the right. An equivalent erosion in support would have cost Mr Biden 50,000 votes in 2020, enough for him to lose the state. Yet Republicans appear poorly positioned to seize upon their gains as the 2024 general-election campaign gets under way. Four years ago the Republican National Committee (RNC) invested early and heavily to win over Latino voters. This year the RNC is starved for cash. It has just $8m on hand compared with $77m at this point in 2020. And the Arizona Republican Party has been hobbled by dysfunction and factional disputes. All this bodes ill because campaign pros say the formula for winning an election that requires a surge in turnout is simple: spend money and reach out to voters early and often.

Mr Biden could still win the White House while losing Arizona. Assuming that the forecasts of a tight race prove accurate, and that Mr Biden holds on to Pennsylvania and Michigan, which are his strongest prospects among the half-dozen swing states, he would need to win at least one more of them. But Mr Biden’s loosening grip on the Latino vote— which is a significant factor in other closely contested states, particularly Nevada—is hardly encouraging.

Democrats are betting that the electoral maths will continue to favour them in Arizona because the Latino electorate will continue to grow. (They also expect Mr Biden’s standing with voters to improve by November.) The number of Latinos voting in Arizona has in fact increased steadily over the past two decades. This year alone there will be 150,000 newly eligible Latino voters in the state. And Arizona Latinos seem particularly motivated. In 2020 a striking 67% of eligible Latino voters in Arizona went to the polls, compared with 54% nationally (which was the lowest of all major racial and ethnic groups). If Latino turnout again reaches 67% in November, that would mean that Democrats could lose nearly four points from their Arizona margins over Republicans in 2020 and still net just as many votes.

Yet it is not a sure bet that Latinos will comprise a larger share of the electorate in 2024. Mr Biden and Mr Trump are both deeply unpopular candidates. Latinos are especially lukewarm on both. In national-level polling from YouGov/The Economist Hispanic respondents are roughly twice as likely as white ones to say that neither candidate would do a good job handling the issues they prioritise: the economy, inflation, health care and immigration. Among those who select a candidate, Mr Biden is viewed as stronger on health care while Mr Trump is seen as stronger on immigration.

Latino attitudes about immigration do not align neatly with the policies of either major party. Polling from Unidos, a lobbying group, found that roughly 83% of the Latinos they surveyed in Arizona in November 2023 supported a pathway to citizenship for undocumented immigrants, long a Democratic goal. Yet in that same survey 63% favoured securing the border, the signature cause of Republicans. “Republicans only want border security. They don’t want a pathway to citizenship…they just want moats and crocodiles and hot oil on the border,” argues Mr Madrid. And Democrats are often seen as having prioritised everything but a secure border. Between July and October of 2023 Arizona had more migrant encounters on its southern border than any other state and the crisis has persisted this year. Republicans will be hoping that Democrats bear the brunt of the political fallout.

Top: Samual Lopez, 31, who said he is voting for Donald Trump in November, added that he is frustrated at the US sending aid to Ukraine when there is a large population of homeless people in Phoenix.
Bottom: Ayling Dominguez, 26, who works as an advocate for immigrant rights, said Latino voters should “evolve the way we see our power and choices in electoral politics.” Image: Caitlin O’Hara

Economic issues may also hurt Mr Biden. Until 2019 housing in the Phoenix metropolitan area, where two-thirds of the state’s population lives, was cheaper than the nationwide average. Residents there now shell out 12% more than average. Inflation also spiked higher in Phoenix during 2022 than in any other city, although it has since fallen below the national average. In November 2023 some 59% of Latinos in the state said inflation was one of their most pressing concerns. That cannot be helping Mr Biden’s standing.

These perceptions may yet change as inflation softens. But views on access to abortion tend to be more fixed, and here Democrats retain an advantage. Some 65% of Arizona Latinos think that, no matter their personal views, it is wrong to make abortion illegal. In the aftermath of the Dobbs decision in 2022, which overturned the constitutional right to abortion, a surge of women registered to vote in Arizona. In November Arizonans may vote on a referendum that would protect a woman’s right to an abortion through viability, or about 24 weeks of pregnancy. That could increase Democrat-leaning turnout.

Political campaigns come and go, but Democrats’ outreach to Latinos is maintained during off-cycle years with a vast network of grassroots Latino organisations that hew progressive. “This does not exist on the Republican side of the equation,” laments Helder Toste, a former field director at the Republican National Senatorial Committee.

These dynamics will affect more than just the presidential ticket. They may well help decide which party controls the House and the Senate. Mr Gallego, who currently represents parts of Phoenix in the House of Representatives, will probably do battle with Kari Lake, a Trump acolyte and election-denier, for Kyrsten Sinema’s open Senate seat. The state also has two competitive House races. One features an incumbent and rising star, Juan Ciscomani, a Mexican-born Republican who gave the party’s Spanish-language response to Joe Biden’s state-of-the-union speech in 2023.

The election is still more than seven months away and many Latino voters have not tuned in yet. According to polling from YouGov/The Economist, 38% of Hispanic respondents, compared with 23% of white respondents, say they are paying little or no attention to the 2024 presidential campaigns. In the autumn, when more Latino voters take note, they are likely to be bombarded with messages that the fate of the nation lies in their hands. In Arizona at least, the adverts will not be all exaggeration. ■

Sources: YouGov; Catalist; Redistricting Data Hub; US Census Bureau; OpenStreetMap; Pew Research Centre; Federal Election Commission; All About Redistricting; ArcGIS; The Economist

Economics

Americans are getting flashbacks to 2008 as tariffs stoke recession fears

Published

8 hours ago

April 26, 2025

Business Finance News

Homemade barbecue pork chops. Katy Perry performs onstage during the Katy Perry The Lifetimes Tour 2025. A woman checks her receipt while exiting a store.

iStock| Theo Wargo | Hispanolistic | Getty Images

A few weeks ago, as Kiki Rough felt increasingly concerned about the state of the economy, she began thinking about previous periods of financial hardship.

Rough thought about the skills she learned about making groceries stretch during the tough times that accompanied past economic downturns. Facing similar feelings of uncertainty about the country’s financial future, she began making video guides to recipes from cookbooks published during previous recessions, depressions and wartimes.

The 28-year-old told followers that she is not a professional chef, but instead earned her stripes by learning to cook while on food stamps. From Rough’s yellow-and-black kitchen in the Chicago suburbs, she teaches viewers how to make cheap meals and at-home replacements for items like breakfast strudel or donuts. She often reminds people to replace ingredients with alternatives they already have in the pantry.

“I keep seeing this joke over and over in the comments: The old poors teaching the new poors,” Rough told CNBC. “We just need to share knowledge right now because everyone is scared, and learning is going to give people the security to navigate these situations.”

The self-employed consultant’s videos quickly found an audience on TikTok and Instagram. Between both platforms, she’s gained 350,000 followers and garnered about 21 million views on videos over the last month, by her count.

President Donald Trump’s announcement of broad and steep tariffs earlier in April has ratcheted up fears of the U.S. economy tipping into a recession in recent weeks. As Americans like Rough grow increasingly worried about the road ahead, they are harking back to the tips and tricks they employed to scrape by during dark financial chapters like the global financial crisis that exploded in 2008.

Google is predicting a spike in search volumes this month for terms related to the recession that came to define the late 2000s. Searches for the “Global Financial Crisis” are expected to hit levels not seen since 2010, while inquiries for the “Great Recession” are slated to be at their highest rate since the onset of the Covid pandemic.

Porkchops, house parties and jungle juice

On TikTok, a gaggle of Millennials and Gen Xers has stepped into the roles of older siblings, offering flashbacks and advice to younger people on how to pinch pennies. Some Gen Zers have put out calls to elders for insights on what a recession may feel like at this stage of life, having been too young to feel the full effects of the financial crisis.

“This is, potentially, at least on a large scale, the first time that millennials have been able to be the ‘experts’ on something,” said Scott Sills, a 33-year-old marketer in Louisiana. “We’re the experts on getting the rug pulled out from under us.”

Those doling out the advice are taking a trip down memory lane the to tail-end of the aughts. Cheap getaways to Florida were the norm instead of lush trips abroad. They had folders for receipts in case big-ticket purchases went on sale later. Business casual outfits were commonplace at social events because they couldn’t afford multiple styles of clothing.

Porkchops were a staple dinner given their relative affordability, leading one creator to declare that they “taste like” the Great Recession. They drank “jungle juice” at house parties, a concoction of various cheap liquors and mixers, instead of cocktails at bars.

“There’s things that I didn’t realize were ‘recession indicators’ the first time around that I thought were just the trends,” said M.A. Lakewood, a writer and professional fundraiser in upstate New York. “Now, you can see it coming from 10 miles away.”

Customers shop for produce at an H-E-B grocery store on Feb. 12, 2025 in Austin, Texas.

Brandon Bell | Getty Images

To be sure, some of the discourse has centered around how inflationary pressures have made a handful of these hacks defunct. Some content creators pointed out that the federal minimum wage has sat at $7.25 per hour since 2009 despite the cost of living skyrocketing.

Kimberly Casamento recently began a TikTok series walking viewers through recipes from a cookbook that was focused on affordable meals published in 2009. The New Jersey-based digital media manager said she’s found costs for what were then considered low-budget meals ballooning between about 100% and 150%. In addition to sharing the price changes, the 33-year-old gives viewers some tips on how to keep costs down.

“Every aspect of life is so expensive that it’s hard for anybody to survive,” Casamento said. “If you can cut the cost of your meal by $5, then that’s a win.”

‘A very human thing’

This type of communal knowledge-sharing is common during times of economic belt tightening, according to Megan Way, an associate professor at Babson College who studies family and intergenerational economics. While conversations about how to slash costs or to make meals stretch typically took place among neighbors in the late 2000s, Way said it makes sense that they would now play out in the digital square with the rise of social media.

“It’s a very human thing to reach out to others when things are feeling uncertain and try to gain on their experience,” Way said. “It can really make a difference for feeling like you’re moving forward a little prepared. One of the worst things for an economy is absolute fear.”

Cultural parallels

That’s one of several parallels social media users have drawn between the late aughts and today. When videos surfaced of a group dancing to Doechii’s hit song “Anxiety,” several commenters on X reported feeling déjà vu to when flashmob performances were common.

Disney‘s reboot of the animated show “Phineas and Ferb,” which originally premiered in the late 2000s, similarly put the era top of mind.

Lady Gaga performing at Coachella 2017

Getty Images | Christopher Polk

“Recession pop,” a phrase mainly referring to the subgenre of trendy music that dropped during the Global Financial Crisis, has caught a second wave over the past year as Americans contended with inflation and high interest rates.

Now, in 2025, as the chorus of voices projecting a recession ahead grows, pop music has some familiar sounds.

In 2008, artists such as Miley Cyrus, Lady Gaga and Katy Perry regularly appeared on the music charts. Both Cyrus and Gaga have released new songs this year. Perry kicked off a world tour this week.

“It’s almost a permission to feel good, whether that’s through song or something,” said Sills, the marketer in Louisiana. “It’s not necessarily ignoring the problems that are here, but just maybe finding some sort of joy or fun in the midst of all of it.”

Economics

Checks and Balance newsletter: Predictions for the Democrats’ future

Published

9 hours ago

April 26, 2025

Business Finance News

Checks and Balance newsletter: Predictions for the Democrats’ future

Economics

ECB members say inflation job nearly done but tariff risks loom

Published

1 day ago

April 25, 2025

Business Finance News

Guests and attendeess mingle and walk through the atrium during the IMF/World Bank Group Spring Meetings at the IMF headquarters in Washington, DC, on April 24, 2025.

Jim Watson | Afp | Getty Images

After years dominated by the pandemic, supply chains, energy and inflation, there was a new topic topping the agenda at the World Bank and International Monetary Fund’s Spring Meetings this year: tariffs.

The IMF set the tone by kicking off the week with the release of its latest economic forecasts, which cut growth outlooks for the U.S., U.K. and many Asian countries. While economists, central bankers and politicians have been engaged in panels and behind-the-scenes talks, many are attempting to work out whether trade tensions between China and the U.S. are — or perhaps are not — cooling.

Policymakers from the European Central Bank that CNBC spoke to this week broadly stuck a dovish-leaning tone, indicating they saw interest rates continuing to fall and few upside risks to euro zone inflation. However, all stressed the current high levels of uncertainty, the need to keep monitoring data, and the high risks to the growth outlook — sentiments also echoed by Bank of England Governor Andrew Bailey in his interview with CNBC on Thursday.

These were some of the main messages from ECB members this week.

Christine Lagarde, European Central Bank president

On inflation and monetary policy:

“We’re heading towards our [inflation] target in the course of 2025, so that disinflationary process is so much on track that we are nearing completion. But we have the shocks, you know, and the shocks will be a dampen on GDP. It’s a negative shock to demand.”

“The net impact on inflation will depend on what countermeasures are eventually taken by Europe. Then we have to take into account the [German] fiscal push by the defense investments, by the infrastructure fund.”

“We have seen successive movements, you know, announcement [of U.S. tariffs], and then a pause, and then some exemptions. So we have to be very attentive… Either we cut, either we pause, but we will be data dependent to the extreme.”

Watch CNBC's full interview with ECB president Christine Lagarde

On market moves:

“When we had done our projections, we anticipated that… the dollar would appreciate, the euro would depreciate. It’s not what we saw. And there have been some counter-intuitive movements in various categories.”

“The German market has obviously been shocked in a positive way by the program soon to be put in place by the German government, with a commitment to defense, with a commitment to a big fund for infrastructure development.”

Klaas Knot, The Netherlands Bank president

On tariff uncertainty:

“If I look back over the last 14 years, in the initial days of the pandemic I think that was comparable uncertainty to what we have now.”

“In the short run, it’s crystal clear that the uncertainty that is created by the unpredictability of the tariff actions by the U.S. government works as a strong negative factor for growth. Basically, uncertainty is like a tax without revenue.”

On the inflation impact:

“In the short run, we will have lower growth. We will probably also have lower inflation. As we also see, the euro is appreciating as energy prices have also come down. So together with the sort of negative factor uncertainty in the short run, it’s crystal clear that it will accelerate the disinflation.”

It's 'crystal clear' that tariffs could hit growth in the short term, ECB's Knot says

“But in the medium term, the inflation outlook is not all that clear. I think there are still these negative factors. But in the medium term, you might get retaliation. You might get the disruption of global value chains, which might also be inflationary in other parts of the world than the U.S. only. And then, of course, we have the fiscal policy coming in in Europe. So this is actually a time in which you need projections.”

On a June rate cut and market pricing for two more ECB rate cuts in 2025:

“I’m fully open minded. I think it’s way too early to already take a position on June, whether it would be another cut. It will fully depend on these projections.”

“I would need to see a more structured analysis of the impact on the inflation profile ahead of us, and only then can I say whether the market is pricing fair or whether I don’t.”

Robert Holzmann, Austrian National Bank governor

On the need to wait for more data and news on tariffs:

“We have not seen this uncertainty now for years… unless the uncertainty subsides, by the right decisions, we will have to hold back a number of our decisions, and hence, we don’t know yet in what direction monetary policy should be best moved.”

“Before looking at data in detail, the question is, what kind of political decisions will be taken? Is it that we will have some tariff increases? Is it that we will have strong tariff increases? Is it that we will have retribution by high counter tariffs?”

We have not seen this much uncertainty for years, Austrian central bank governor says

On the ECB’s April rate cut:

“I think there’s a broad consensus [on rates]. But of course, at the margin, people differ.”

“My assessment is that at this time, it wasn’t clear yet to what extent [tariff] countermeasures were being taken. Because with countermeasures in Europe, prices may have increased. Without countermeasures, quite likely the price pressure is downward. And for the time being, we don’t know yet the direction.”

On the direction of interest rates:

“I think if the recent noises about an arrangement [on trade] were to be true, in this case, quite likely it is more towards the downside than the upside with regard to prices. But this can be changed with different decisions and the result of which, we may even imagine in [the] other direction. For the time being, no, it will be down.”

“There may be further cuts this year, but the number is still outstanding.”

Mārtiņš Kazāks, Bank of Latvia governor

On opportunity from tariffs:

“With all this uncertainty and vulnerability, this is also the time of opportunities for Europe.”

“It’s a time for Europe to grasp all the aspects of being an economic superpower and becoming a really fully-fledged political and geopolitical superpower, and this requires doing all the decisions that in the past, were not carried out fully.”

“This requires political will, political guts to make those decisions, and to strengthen the European economy and assert its place in a global world.”

Global vulnerability an opportunity for Europe, says ECB's Kazāks

On market reaction to tariffs:

“So far it seems to be relatively orderly … but if one looks at the spillovers to Europe, the financial markets are working more or less fine, we haven’t seen spreads exploding or anything like that.”

“But in terms, however, of the macro scenarios, this uncertainty is extremely elevated in the sense that, given the possible outcomes, the multiple scenarios and their probabilities are very similar with the baseline [tariff] scenario.”