Left brain, right brain

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I had an interesting experience last week during a drive up to Colgate University to give a book talk. Colgate, a small liberal arts institution, is located about five hours away from New York City in upstate New York.

Before telling the story, I should offer some context. New York, like many large states with dense urban areas and large swaths of rural land, is basically two separate states. There is NYC and its surrounding areas, which are wealthy and Democratic. Then there’s the rest of the state, much of which skews Republican. Upstate areas in particular tend to be conservative, despite blips of blue in college towns. That’s because upstate New York reached its economic pinnacle sometime during the 19th century, when the Erie Canal was a major supply chain route, and wealthy New Yorkers who couldn’t yet travel by plane to more exotic locales vacationed in the Catskill and Adirondack mountains.

These days, the big companies that were born in the region during the Second Industrial Revolution — groups such as General Electric, IBM, Kodak and Xerox — have moved most of their operations elsewhere. The shift to trucking and air transport, as well as deindustrialisation and outsourcing, have depopulated and economically decimated the area.

That’s one of the big reasons that the Biden administration has targeted it for fiscal stimulus in sectors such as semiconductors. The president campaigned on a promise to invest in forgotten areas, the sort of places where angry white men voted for Donald Trump in the past two elections. Some data coming out on Tuesday from the Brookings Institution will show just how successful that investment campaign has been (check out the numbers when the link goes live tomorrow, here. One Chips Act project involves Micron, a big semiconductor company, which announced a $20bn investment in upstate New York, growing to $100bn over the next two decades.

That is exactly the sort of project that I assumed my driver, a laid-off engineer now running a taxi company, would love. But to my surprise, he had nothing good to say about the plan, or the place-based economic strategies being pursued by this White House. “It’s all going to be a big waste,” he said, stressing that the company had chosen the wrong location, would put too much strain on local water systems (an interesting point for a conservative to make), and pretty much every other complaint you could imagine. This despite the projected 50,000 jobs that would be created. “Democrats just pour money down the drain.”

As I listened to his viewpoint, I asked him what he thought Trump would do for the region if he were elected. He didn’t offer any specifics, but said simply, “people up here just don’t like being lied to”. At which point I realised we weren’t having a policy conversation, we were having an emotional conversation. While there’s nothing particularly surprising there, it’s interesting to note that quantitatively, this has become an increasingly common phenomenon in politics over the past 20 years, particularly during times of economic recovery. As this Stanford/NYU research on the growing partisan divide in economic perceptions shows, the gap in economic perceptions between Democrats and Republicans approximately doubled between 1999 and 2020, with recoveries tending to be the most polarised period.

The authors speculate that this may be because recovery periods tend to be characterised by mixed data points, as the business cycle transitions. But, as the Financial Times’ Washington bureau chief James Politi, the FT’s Marc Filippino and I discuss on the latest episode of the Swamp Notes podcast, the economic data these days is pretty much all good. And yet, the divide persists.

I have no doubt that we’ll see this trend manifest in the already partisan divide between how Democrats and Republicans respond to the new Department of Justice report that exonerates the president from document mishandling, but also raises concerns about his memory and age. Peter, I will end this note will a big question for you: will Democrats shift direction and replace Biden? Or will they double down on him?

Recommended reading

• Aside from the partisan cognitive divide, why are Americans so down on a strong economy? This smart front-page Wall Street Journal piece looks at how the rising cost of being middle class, coupled with a sense of endemic labour market insecurity despite the strong jobs numbers of the moment, have led to a persistent wariness about the long-term state of the economy.

• Cornell fellow Cara Eckholm channels Jane Jacobs in this New York Times op-ed, which argues for new zoning laws to reinvigorate the city post Covid. I couldn’t agree more. We could do so much to solve the housing crisis immediately if we allowed single-family homeowners to rent space in their properties more easily, and changed laws for small landlords relative to large institutional ones.

• I very much agree with this op-ed in the FT by Zainab Usman that argues the US should keep good trade relations with Africa. In particular, she makes great points about the opportunity for securing rare earth minerals and other commodities in exchange for the transfer of technology and knowhow from the developed world.

• And my colleague Tej Parikh is spot on that we have become way too obsessed with monetary policy. This is so true. It sometimes seems like there’s as much gaming and online discussion of every move of the Federal Reserve as there is of professional sports.

Peter Spiegel responds

Rana, as you probably remember, we tussled over this very issue when I filled in for Ed Luce here in the Swamp back in September. That was the last time the Democratic gossip mill was filled with angst over whether Biden should drop out because of his advanced age. What I believed then — and believe now — is that the whole debate misunderstands Biden as a politician. 

Over the course of his presidency — indeed, since he was chosen as Barack Obama’s vice-president in 2008 — Biden has projected the image of an avuncular old uncle, and the public has largely bought into it. But that kindly aspect masks an intensely competitive politician who has a rather big chip on his shoulder about being a working-class Joe (literally), educated at run-of-the-mill universities, in an American capital dominated by Ivy Leaguers who ticked all the right careerist boxes (Washington clerkships, fellowships, gofer-ships) to rise to positions of power. 

In the account of many in Bidenworld, this “chippiness” is long-held, but reached its apotheosis during the Obama administration, when a lot of Obama’s team (and, by some accounts, Obama himself) belittled Biden and his aides because of their perceived lack of intellectual credentialing. In order to show the Obamas that he is as good or better president, Biden needs two terms. This is what has long driven him as a person and a politician, so even with the latest embarrassment, I find it highly doubtful he will withdraw from the race.

You ask, Rana, whether Democrats will shift direction and replace him. The problem is that Democrats don’t have a choice in the matter. The nature of the primary system means that Biden has the nomination all but sewn up — even though we’re several months from the Democratic National Convention. As our friend and colleague James Politi pointed out this weekend, if Biden doesn’t pull out, it’s almost impossible to replace him. It would take a massive revolt among Biden’s own convention delegates to happen. 

Biden is not going anywhere voluntarily. That means Democrats will have to suck it up and back the president, regardless of any misgivings they may have in private.