Right now, our nation is at war with an elusive enemy. Not one armed with a gun or with the support of a nation behind it, but rather a nomad with no political aim: COVID-19, a new strain of the coronavirus that was discovered in Wuhan, China. It has caused the nation to go into a state of lockdown.
As President Trump and his administration prepare for the worst, investors’ fears in the economy have shaken markets across the globe. It has already led to major selloffs, being dubbed Black Monday and Black Thursday. The Federal Reserve has become so fearful of economic turmoil that could lead to a recession that they have poured $1.5 trillion in loans to banks, in order to stabilize the economy.
In addition, the White House has delayed Tax Day to July 15 to provide a $200 billion stimulus. Why is our President so quick to revive the economy? Yes, he is doing the right thing, but he also has some motives other than the public interest. He has a re-election coming up.
Who was the last president to win re-election with a recession in the second half of their first term? That man was William McKinley. This was back in the 1900 election, when the Democratic Party was still recovering from being on the wrong side of the Civil War. You also could possibly include Calvin Coolidge, who won his first election after taking over for the late Warren Harding during the 1924 election, despite the recession at the time.
According to an article he wrote in the Washington Post, Bob Dole claimed that former President Nixon warned him prior to the 1996 election that, “If the economy’s good, you’re not going to beat Clinton.” The calculus is simple. A poor economy equals a failure to secure re-election on the incumbent’s behalf.
“If the economy is good, you’re not going to beat Clinton.”
First question to answer is, what is a recession? A recession is generally seen as an economic decline occurring in a few consecutive months, usually spanning over two quarters. Goldman Sachs projects a 5% drop in GDP next quarter, and former Trump economic advisor Gary Cohn claims that the United States is already in a recession.
Things are not looking good for the man who once touted that he will be the greatest “Jobs President” in American history. Fears of a recession were already mounting last year, but the coronavirus has sped that process up, as economic activity comes to a halt. Restaurants, hotels, and other commercial activity is becoming extremely limited across the country and the world, as public health officials wish to lower the spread of COVID-19 as much as possible. It has become pretty clear that this crisis is a driving factor in what could end up becoming a global recession.
Furthermore, the oil war between the Saudi Arabian and Russian governments has led to an increase in oil production on the part of the former, which will hurt the United States, which is one of the leading oil exporters. American energy companies will find it hard to compete, and will struggle with the large amount of debt that they have.
Now, how does this affect the 2020 election? As I have said, it is near impossible for a post Great Depression era President to win re-election if there is a recession. The coronavirus, oil war, and other investor concerns are looking like there is a recession currently happening. Of course, we will have to wait till the end of next quarter to assess if there is a strong enough decline. However, as each American heads to the ballot box now with a lighter wallet, they will blame the incumbent President.
The blue collar workers that Trump won over in the 2016 election will cause them to go back to the Democratic Party, which could lead to the Democratic nominee winning Michigan, Wisconsin, Ohio, and Pennsylvania.
As I wrote in a previous article, a Joe Biden-Tammy Baldwin ticket would win these states. During the last debate, Joe Biden pledged to choose a woman, and the Senator from Wisconsin is the most proven person in terms of electoral success in purple, mid-western states. She won re-election comfortably in 2018 in a state Trump won in 2016. By tapping one of their own, the voters that the Democrats lost may come back to them in 2020.
Things look dire for the reality TV star that made his mark in history with one of the most surprising election victories.”
While the majority of events that will determine the future of the economy and the election have yet to unfold, things look dire for the reality TV star that made his mark in history with one of the most surprising election victories. As Joe Biden inches closer to the nomination, the President will begin to panic. He may even replace Mike Pence with Senator Ron Jonhsnon of Wisconsin, Rob Portman of Ohio, or Senator Pat Toomey of Pennsylvania.
Regardless of his running mate, Trump will struggle to defeat a Biden-Baldwin ticket with the current state of the economy. The best campaign move the President can make is protect the nation from the outbreak as much as he can, as well as save the economy from recession through stimulus packages.
-Matthew Bermingham, Guest Writer
Do you agree with the guest writer? Comment down below and visit the front page for more!