It is ironic that for someone who built his fortune on real estate construction, Donald Trump’s singular “achievement” as president has been as a wrecker. He has shattered virtually every single presidential norm in American politics. Paradoxically, the sheer magnitude of this wreckage presents Joe Biden and the Democratic Party with an excellent opportunity to reconstruct the American economy in a way fundamentally different from anything that has been tried over the past 40 years. That means going beyond “Never Trumpism” and embracing a positive vision of national developmentalism, especially in regions that the market has neglected for decades.
Back in 2016, in marked contrast to every other Republican presidential nominee of the past half-century, Trump attacked Wall Street, free trade, international financiers (especially Goldman Sachs). Even more striking, he critiqued the entire basis of post–World War II economic development that was largely constructed on the failed promises of globalization:
Our politicians have aggressively pursued a policy of globalization—moving our jobs, our wealth and our factories to Mexico and overseas. Globalization has made the financial elite who donate to politicians very wealthy. But it has left millions of our workers with nothing but poverty and heartache.
Ironically, this is the very message that also animated the Bernie Sanders campaigns of 2016 and 2020.
A positive presidential campaign today needs to highlight the gaps between Trump’s 2016 rhetoric and the underlying reality of his presidency. Not only has the president failed to “drain the swamp”; he has turned his administration into a cesspool of corporate cronyism and rent-seeking. Former vice president Biden, however, must also combine this with a positive message of national regeneration if he is to reduce the “enthusiasm gap” now evident in polling—the kind of message that resonated with those same working-class Rust Belt voters, enough of whom voted for Trump last time to give him his slender margin of victory.
A national industrial policy that promises to “level up” hitherto depressed regions can be a winner for Biden. Consider the recent example in the UK, where Boris Johnson’s Conservative Party secured a huge election victory last December, largely by creating a powerful new coalition that promised to regenerate economic growth, especially in regions that have long drawn the short end of the stick in the globalization sweepstakes. These proposals included significant investments in public infrastructure, expanding internet broadband access, and creating regional research hubs funded in large part by the state. This aid would be overwhelmingly focused in the economically depressed North and Midlands, bringing together private finance, universities, vocational colleges, and business associations, to reduce the heavy financialization of the British economy, as well as minimizing regional wealth disparities.
Today, America’s two dominant political parties are in flux. However, that creates opportunities for Biden, much as the Great Depression of the 1930s temporarily incapacitated the country’s “economic royalists,” thereby enabling FDR to fundamentally alter the American economic landscape and create a dominant new governing coalition in the process. That coalition served Democrats well for decades. But it is now in shambles, as Democrats have increasingly come to rely on big money from new power centers, which has in turn shifted their policy priorities.
The problem is that these new policy priorities have increasingly alienated the party from its traditional base, which culminated in the 2016 election fiasco. The party’s historic constituencies, especially organized labor, are increasingly disenfranchised. They have, in turn, become more receptive to Trump’s message on trade, immigration, and nationalism, while the technocratic elites and neocons, who increasingly are migrating to the Democratic Party, in turn have blithely led us from one major policy failure to the next: disastrous wars of choice, numerous financial crises, growing inequality, and a lackluster response to a climate crisis that is currently incinerating the country’s West Coast.
Winning back working-class voters, while concomitantly sustaining enthusiasm among progressives, does not entail a nostalgic return to the smokestack industries of the 1950s but rather a Green New Deal that reconfigures our outdated public infrastructure. Biden’s proposals, as outlined by Ambrose Evans-Pritchard of The Telegraph, feature “hydrogen for road freight, shipping, and aviation; 200,000 miles of high-voltage transmission lines, with 500,000 charging stations for electric vehicles; the installation of 500 million solar panels and 60,000 wind turbines; and a federal blitz to drive down the cost of grid-scale energy storage tenfold.”
That represents a good first step, but it’s not enough. Biden must also build on the shoulders of his great progressive predecessors who occupied the White House. FDR’s New Deal and LBJ’s Great Society are both signature Democratic Party achievements. Instead of running away from them, or trying to cut them, Biden should be building on them. Imagine how a New Deal type of program today could have substantially cushioned today’s coronavirus-induced unemployment crisis. Likewise, Medicare for All (as opposed to having health care be a condition of employment) could well have saved tens of thousands of lives and mitigated the worst impacts of Covid-19.
Even here, industrial policy becomes key. Biden must address key gaps in our supply chains, which the pandemic highlighted—notably crucial face mask shortages, and inadequate quantities of hospital personal protection equipment. Senator Elizabeth Warren’s introduction last July of her sweeping Pharmaceutical Supply Chain Defense and Enhancement Act demonstrates that Washington is beginning to reach a consensus on this issue—this is no longer the sole province of Trump’s “America First” movement. “To defeat the current Covid-19 crisis and better equip the United States against future pandemics, we must boost our country’s manufacturing capacity,” Warren said, recasting the consequences of decades of policy to offshore our economic production as an “overreliance on foreign countries.” Warren’s warnings take on new force in light of Beijing’s threat to restrict American access to medical supplies in retaliation for intensifying US regulations on Huawei.
Perversely, the Biden campaign is downplaying its reformist impulses, for example cynically suggesting to the party’s donor base that some publicly mooted financial proposals that undermined the power of the banks would not be central to a Biden presidency. That smacks too much of the Wall Street appeasement that ultimately doomed Obama’s attempted bank reforms and contributed to much of today’s prevailing disillusionment among voters. With Trump now narrowing Biden’s lead in the polls, championing weak incrementalism and making sure nothing fundamentally changes is potentially disastrous. As Robert Kuttner argues, the United States faces the twin challenges of “restoring a badly impaired democracy [and] redeeming a deeply corrupted economy.”
Given the non-stop 24 hour circus that pervades the Trump presidency, it is understandable why some believe that voters simply crave a “return to normalcy.” But “normalcy” brought Warren Harding, hardly an inspiring totem for the Democrats. Great leaders don’t anesthetize; they lead and inspire. Tepid managerial technocracy of the sort being offered by recent Democratic administrations won’t address today’s massive challenges. A great coalition predicated on social solidarity and national industrial policy is the real ticket to long term success.