The US Political Split Grows

Dems Win Even Fewer Counties in 2016, But an Increased 64% of GDP!

https://www.brookings.edu/blog/the-avenue/2016/11/29/another-clinton-trump-divide-high-output-america-vs-low-output-america/

The rural versus urban split in American politics was very clear in the 2016 presidential election.

Trump Won 2016 in Rural Leaning Areas

https://www.brookings.edu/blog/the-avenue/2016/11/11/the-small-town-big-city-split-that-elected-donald-trump/

Democrats are the Metro Party, Representing Just 20% of the Land Area

Democratic Congressional Districts are Increasingly More Economically Productive

https://www.brookings.edu/blog/the-avenue/2018/11/16/americas-two-economies-remain-far-apart/

Larger Metro Areas Continue to Grow Faster

https://www.brookings.edu/research/countering-the-geography-of-discontent-strategies-for-left-behind-places/

Threat of Automation Job Reduction Haunts Republican States More

https://www.brookings.edu/blog/the-avenue/2019/03/25/automation-perpetuates-the-red-blue-divide/

Trump Counties Employment Growth Increased in 2018, Due to Cyclical Expansion of Maunfacturing

https://www.brookings.edu/blog/the-avenue/2019/05/06/trump-counties-may-be-winning-a-bit-more-but-their-prognosis-remains-dim/

Democratic versus Republican Local Economies Split Becomes Much Clearer by 2018

https://www.brookings.edu/blog/the-avenue/2019/09/10/america-has-two-economies-and-theyre-diverging-fast/

Dems represent just 20% of the US land area.

Dem GDP/district is 50% higher than Republican areas.

Dem district median income is 15% higher.

Dem district productivity is 75% higher.

Dem districts have 36% college degree holders versus 28%.

Reps have more basic manufacturing (56%) and agriculture/mining (60%).

Dem districts have more foreign-born population (20/8) and more non-white residents (50/28).

Biden Democratic Coalition Represents 71% of US $GDP

https://www.brookings.edu/blog/the-avenue/2020/11/09/biden-voting-counties-equal-70-of-americas-economy-what-does-this-mean-for-the-nations-political-economic-divide/

Democrats Represent 61% of GDP at Senate Level

Just 6 of 50 states have split US Senate representation. WV, OH, PA, ME, WI and MT account for slightly less than 10% of the 2021 US GDP.

Republicans have 2 Senators in 22 states, which account for $6.6T of GDP.

Democrats have 2 Senators in 22 states, which account for $10.8T of GDP.

Splitting the GDP for the 6 split states 50/50 results in $7.5T in Republican states and $11.7T in Democratic states. The Democratic states have 57% greater GDP in 2021.

The Democratic percentage advantage in 1997 GDP per state is identical. Republican states produced $4.5T while Democratic states produced $7.1T. Between 1997 and 2021, Democratic and Republican states grew at equal percentages. In dollar terms, Democratic states added $4.6T, while Republican states added $3.0T.

Percentages are difficult to digest. One way to compare the 2021 GDP of the two parties is to use “paired comparisons” and then examine the remaining non-paired states. 13 roughly equal pairs can be identified. WY-VT, AL-RI, ND-DE, ID-MA, KS-NV, MS-NH, AR-NM, SC-OR, LA-AZ, MO-CT, TN-MN, IN-MD and NC-MA.

The remaining Republican states have lower $GDP figures but can be mapped to equal $GDP Democratic states. IA+NE+SD=CO. FL+TX=CA. KY+AL+OK+UT=IL.

This leaves 6 states that represent the $4.5T (57%) Democratic state advantage: Michigan ($0.5T), New Jersey ($0.6T), New York ($1.5T), Virginia ($0.5T), Georgia ($0.6T) and Washington ($0.6T).

Summary

The Post-Trump Republican Party is distinctively different, representing a broader share of the American geography, but a smaller share of its income, production and diversity. This split reinforces the polarizing tendencies of recent decades, making attempts to find “common ground” at the national level more difficult.

US Murder Rates Up in 2020-21

https://www.cnn.com/2021/12/12/us/homicides-major-cities-increase-end-of-year-2021/index.html

Above: Another Murder in Bridgeport Neighborhood of Chicago, My Home 2010-18

https://crime-data-explorer.app.cloud.gov/pages/explorer/crime/crime-trend

1985-95 8/100K. 1999-2008 5.5/100K. 2009-19 5/100K.

1966-2020 Context. 1970-95 Very High Rates.

https://www.pewresearch.org/fact-tank/2021/10/27/what-we-know-about-the-increase-in-u-s-murders-in-2020/

Twentieth Century Context: US Has High Homicide Rates

https://en.wikipedia.org/wiki/Crime_in_the_United_States#/media/File:Homicide_rates1900-2001.jpg
https://www.jrsa.org/projects/Historical.pdf

Relative Violent Crime Rates

https://usafacts.org/data/topics/security-safety/crime-and-justice/crime-and-police/violent-crimes/?utm_source=google&utm_medium=cpc&utm_campaign=ND-StatsData&gclid=Cj0KCQjw8_qRBhCXARIsAE2AtRYrdjEGFcHhSe1xpRQXCK59y0pe3Dkh9pOCg2WBHhO3fRPrXWDCz0QaAuqYEALw_wcB

Firearms Involved in Homicides and Suicides

https://usafacts.org/state-of-the-union/crime/

Homicide Rate Up 30% in 2020, 5% in 2021

https://www.pewresearch.org/fact-tank/2021/10/27/what-we-know-about-the-increase-in-u-s-murders-in-2020/

Focus on Rates Per 100K for US or All Cities, Not Counts in Individual Cities

https://abcnews.go.com/US/12-major-us-cities-top-annual-homicide-records/story?id=81466453

Many Factors Proposed to Explain the Increase

https://www.vox.com/2020/8/3/21334149/murders-crime-shootings-protests-riots-trump-biden

https://www.theatlantic.com/ideas/archive/2021/09/america-having-violence-wave-not-crime-wave/620234/

Good News: US Property Crime Rates Cut in Half Since 1998

https://crime-data-explorer.app.cloud.gov/pages/explorer/crime/crime-trend
https://ncvs.bjs.ojp.gov/multi-year-trends/crimeType

Property Crime Rates Were Very High 1975-90

https://www.factcheck.org/2020/06/trump-wrong-on-crime-record/

FBI and Bureau of Justice Data Both Show Declines, Reporting of Crimes Remains Consistent

https://www.pewresearch.org/fact-tank/2020/11/20/facts-about-crime-in-the-u-s/

Property Crime Rates Have Fallen Despite Changes

https://porch.com/advice/most-urbanized-states
https://www.pewresearch.org/social-trends/2018/05/22/demographic-and-economic-trends-in-urban-suburban-and-rural-communities/
https://www.pewresearch.org/fact-tank/2020/08/20/key-findings-about-u-s-immigrants/
https://www.pewresearch.org/fact-tank/2021/08/23/most-americans-say-the-declining-share-of-white-people-in-the-u-s-is-neither-good-nor-bad-for-society/
https://www.pewresearch.org/social-trends/2020/01/09/trends-in-income-and-wealth-inequality/
https://theconversation.com/gun-violence-has-fuelled-enduring-trust-issues-for-many-americans-144413
https://www.pewresearch.org/social-trends/2014/03/07/millennials-in-adulthood/
https://www.pewresearch.org/fact-tank/2016/04/13/americans-divided-on-how-much-they-trust-their-neighbors/

Good News: US Coal Usage is Falling

https://en.wikipedia.org/wiki/Coal_mining_in_the_United_States
https://www.eia.gov/todayinenergy/detail.php?id=48696
https://en.wikipedia.org/wiki/Coal_mining_in_the_United_States

Exports First Exceeded 10% of Production in 2012

https://www.eia.gov/coal/annual/pdf/acr.pdf
https://www.eia.gov/coal/annual/
https://www.eia.gov/todayinenergy/detail.php?id=38172
https://www.eia.gov/todayinenergy/detail.php?id=37692
https://www.eia.gov/todayinenergy/detail.php?id=43895

Coal Accounts for 20% of Electricity Generation

https://www.csis.org/analysis/phasing-out-coal-us-electricity-increasingly-regional-challenge

https://en.wikipedia.org/wiki/List_of_coal-fired_power_stations_in_the_United_States

30% of Coal-Fired Power Plants Closed 2010-19

https://en.wikipedia.org/wiki/List_of_coal-fired_power_stations_in_the_United_States

https://www.eia.gov/todayinenergy/detail.php?id=50658

Up to Two-thirds of 240 Remaining Coal-Fired Power Plants to Close by 2028

https://www.reuters.com/business/energy/us-coal-fired-power-plants-scheduled-shut-2021-10-28/

https://www.eia.gov/todayinenergy/detail.php?id=50658

https://abcnews.go.com/US/wireStory/coal-fired-power-plants-close-wastewater-rule-81328300

https://www.newsweek.com/26-coal-fired-power-plants-14-states-plan-stop-burning-coal-due-new-rule-1652009

Remaining Coal-Fired Power Plants are Concentrated in a Dozen States

https://pubs.usgs.gov/of/1996/of96-092/Comp/main.gif
https://www.csis.org/analysis/phasing-out-coal-us-electricity-increasingly-regional-challenge

Coal Production and Consumption Temporarily Rebounded in 2021 as the Economy Recovered from the Pandemic and the Cost of Natural Gas Increased

https://www.iea.org/news/coal-power-s-sharp-rebound-is-taking-it-to-a-new-record-in-2021-threatening-net-zero-goals

https://www.cnn.com/2021/10/18/business/coal-power-climate-crisis/index.html

Good News: US Forests Are Growing

Forest Coverage is Up for a Century

Added 51M Sq Miles, 1987-2017: Size of North Carolina

Added 28M Sq Miles, 1990-2020: Size of South Carolina

Timberland Has Grown as Part of Total Forest

Healthy Stock by Volume, Diameter, Age, Carbon

https://usafacts.org/articles/how-us-forests-affect-the-environment-and-help-stabilize-the-climate/

https://crsreports.congress.gov/product/pdf/R/R46313

Annual Growth and Harvest are Sustainable

Ownership, Preservation, Management Plans

US in Global Context

Threats are Real, But Often Exaggerated

“Many challenges are associated with drought, wildfire, invasive species, and outbreaks of insects and disease—all made worse by climate change. Warming temperatures mean more energy in the atmosphere, which is consistent with severe weather events, such as floods, tornadoes, blizzards, ice storms, and hurricanes.” 

https://www.fs.usda.gov/speeches/state-forests-and-forestry-united-states-1

https://www.cnn.com/2019/07/20/health/iyw-cities-losing-36-million-trees-how-to-help-trnd/index.html

https://www.treehugger.com/more-trees-than-there-were-years-ago-its-true-4864115

https://usafacts.org/articles/how-us-forests-affect-the-environment-and-help-stabilize-the-climate/

https://ourworldindata.org/grapher/proportion-of-forest-area-with-long-term-management-plan?time=2020

Good News: US Foreign Aid

US Spends 1% of Federal Budget on Aid, Not 25%

Aid is 1% of Budget, Down from 1.6% in 1980

Aid is 1% of Budget, Down from 1.4% in 2006

https://crsreports.congress.gov/product/pdf/R/R40213

Real $ Spending Increase Driven by Terrorism Threats with Bipartisan Support

https://crsreports.congress.gov/product/pdf/R/R40213

US Leads in Dollar Spending, Trails in $/Person

US Accounts for 23% of Global Aid

US 0.2% of GDP is Very Low for Developed Nation

https://crsreports.congress.gov/product/pdf/R/R40213

Where Does the Money Go?

41% to economic development and commercial interests

35% to military aid and national security

20% for humanitarian purposes

The congressional report splits up the $48B as

Peace/security 16B

Health, Ed $9B

Humanitarian $9B

Economic Growth $4B

Governance $3B

https://crsreports.congress.gov/product/pdf/R/R40213

Where Does the Money Go?

Africa 25%. Middle East 25%. Afghanistan $5B, Israel $3B, Jordan $2B, Egypt, Iraq, Ethiopia, Yemen, Colombia, Nigeria, Lebanon $1B each. Top 10 $16B, one-third of total.

Criticisms of Foreign Aid

Limited evidence that specific country investments provide political returns

Limited evidence of anti-terrorism campaign effectiveness (counterexamples)

Weak administrative structure and oversight at all levels

Direct evidence of individual country economic growth due to aid is limited

Some autocratic governments have benefitted from aid

Some aid is diverted to corrupt governments and individuals

Specific high priority countries have provided weak returns (Egypt, Pakistan, Afghanistan, Iraq)

Higher returns could be gained from investing in Western Hemisphere, Eastern Europe.

https://www.cfr.org/backgrounder/how-does-us-spend-its-foreign-aid

https://www.npr.org/sections/goatsandsoda/2018/09/18/649155725/why-the-u-s-ranks-at-the-bottom-in-a-foreign-aid-index

Benefits

Health measures, disease rates, lifespans. Global health. Economic development results globally and in individual countries. US trade benefits from developing trade lanes. Global education. Increased number of democracies, commitment to mixed capitalist economies. Lower cost of defense. Terrorism activities thwarted. Improved strength of US alliances. Improved flow through NGOs, multilateral organizations improves effectiveness. Dollar allocation provides US policy leverage.

https://www.cfr.org/backgrounder/how-does-us-spend-its-foreign-aid

https://www.concernusa.org/story/foreign-aid-myths-facts/

https://www.pbs.org/newshour/world/column-addressing-myths-surrounding-u-s-foreign-aid

Good News: US and Immigrants

US is top desired destination for immigrants

https://news.gallup.com/poll/245255/750-million-worldwide-migrate.aspx

https://www.weforum.org/agenda/2017/11/these-are-the-countries-migrants-want-to-move-to/

New Zealand is Most Attractive Based on Immigrant Desires Per Destination Population

Best Countries to Migrate to

Immigrants “Vote With Their Feet”. 50 Million in US.

https://www.migrationpolicy.org/programs/data-hub/charts/top-25-destinations-international-migrants

US Remains a Welcoming Country, Overall

A Dozen Ways to Slay Inflation

1. Blue Ribbon Panel

Imitate the 1983 Greenspan Social Security committee.

https://www.washingtonpost.com/archive/business/1988/03/27/a-blue-ribbon-challenge-to-nations-red-ink/fe86db9f-2abf-49bb-8a1f-1e4c96c285ae/

6-month time limit. A dozen or less bipartisan dignitaries. Retired ambassadors, investors, CEO’s, federal reserve presidents, etc. Make Mitch Daniels the chair.

https://www.theatlantic.com/magazine/archive/2020/04/mitch-daniels-purdue/606772/

Assign 2 projects. One to cut government waste. The other anti-inflation policies. No more than a dozen recommendations in each half. Presented to congress for simple yes/no vote, without major amendments allowed.

2. Spend Less Government Money

Fiscal spending is too expansionary for the current situation. Back off. Reduce infrastructure spending for now, spend it in the next recession. Reduce marginal defense programs that only have political reasons. Cut state government spending by 3%, which is budgeted to increased by 9%.

https://www.nasbo.org/reports-data/fiscal-survey-of-states

https://rollcall.com/2021/10/18/congress-blocks-cuts-to-top-contractors-weapon-budgets/

3. Incentivize Consumers to Save More

Less aggregate demand will lower prices in many markets.

Increase 401(k) limit by $10,000 for 3 years.

Provide federal government match on first 5% of savings for all employees.

https://www.shrm.org/resourcesandtools/hr-topics/benefits/pages/2022-irs-401k-contribution-limits.aspx

https://www.tsp.gov/making-contributions/maximize-your-savings/

4. Encourage Corporate Pricing Restraint

Offer corporate income tax incentives for firms to hold prices fixed for 2 years.

Wage and price “controls” are widely criticized. Perhaps a voluntary nudge would work.

5. Add Older Workers to the Labor Supply

Stop all social security fund contributions (taxes) by workers aged 62 and older.

https://www.investopedia.com/articles/personal-finance/060515/when-do-i-stop-paying-social-security-tax.asp

Eliminate the “clawback” of social security benefits to retirees who do choose to work.

https://money.usnews.com/money/retirement/social-security/articles/what-happens-if-you-work-while-receiving-social-security

Tweak labor laws to fight age discrimination.

6. Increase Supply of Legal Immigrants

https://www.cnn.com/2022/01/11/economy/chamber-of-commerce-inflation/index.html

https://www.businessinsider.com/immigration-inflation-labor-shortage-chamber-commerce-suzanne-clark-jobs-work-2022-1

7. Eliminate Hidden Tax of Tariffs and Trade Regulation

Unilaterally eliminate all tariffs with Europe, Central America, South America, Japan, South Korea, New Zealand, India. Negotiate with China.

https://finance.yahoo.com/news/one-way-biden-could-cut-inflation-131832592.html

https://www.cnbc.com/2021/11/30/removing-us-china-trade-tariffs-would-ease-inflation-jacob-lew.html

8. Windfall Profits Taxes

https://www.cbsnews.com/news/biden-tax-how-billionaire-minimum-income-tax-works-cbs-news-explains/

https://rollcall.com/2022/03/24/windfall-profits-tax-consumer-rebate-options-under-discussion/

NEWS: Sanders Introduces Legislation to Reinstate the WWII Windfall Profit Tax to Combat Rising Inequality, Inflation, and Corporate Profiteering

https://www.bloombergquint.com/gadfly/to-fight-inflation-biden-should-tax-the-rich-shrink-the-deficit

9. Cut Transportation Costs

Tax incentive for more truck drivers.

https://www.truckinginfo.com/10166531/new-bill-aims-to-reduce-truck-driver-tax-liabilities

Open ocean shipping to competition.

Open trucking to Mexico based carriers.

10. Negotiate Drug Prices, Allow Interstate Health Insurer Competition

https://hbr.org/2021/10/the-u-s-can-lower-drug-prices-without-sacrificing-innovation

https://www.sidley.com/en/insights/newsupdates/2021/11/us-looks-to-introduce-europeanstyle-drug-price-controls

https://www.freep.com/story/news/nation/2014/09/05/dems-try-gop-idea-on-health-care-put-states-in-charge-of-cost-control/15106115/

https://www.marketwatch.com/story/six-ways-republicans-can-reduce-health-care-costs-in-their-new-plan-2017-03-11

https://www.manhattan-institute.org/reforming-health-insurance-across-states

https://www.commonwealthfund.org/blog/2017/selling-health-insurance-across-state-lines-unlikely-lower-costs-or-improve-choice

11. Increase the Supply of Housing

Increase immigration to improve labor supply. Cut tariffs to reduce supplies costs. Lean on local regulators to reduce zoning restraints and one size fits all building codes. Strategically require a higher share of affordable housing and multifamily permits annually in each metropolitan region. Phase-out the mortgage interest tax deduction for second homes.

https://www.bloomberg.com/news/articles/2022-02-04/in-sizzling-u-s-housing-market-normal-is-a-long-way-off

https://www.whitehouse.gov/cea/written-materials/2021/09/01/alleviating-supply-constraints-in-the-housing-market/

https://www.shrm.org/resourcesandtools/hr-topics/benefits/pages/2022-irs-401k-contribution-limits.aspx

12. Cut Energy Prices

Loosen regulations for 5 years to encourage increased “all of the above supplies” energy through drilling, coal, oil and nuclear. Suspend federal gas tax for 3 years. Negotiate oil price minimums/maximums between US/Europe/Japan and OPEC.

https://www.reuters.com/world/us/bidens-menu-options-high-gasoline-prices-is-not-appetizing-2022-03-23/

https://www.cbsnews.com/news/gas-prices-inflation-us-president-cbs-news-explains/

https://nymag.com/intelligencer/2022/03/heres-how-biden-can-lower-gas-prices.html

Summary

Reducing inflation is a complicated policy area. The solutions proposed by “experts” are rarely politically appealing. Competing political parties hesitate to provide “wins” to the other. However, 8% inflation after a 2-year pandemic while the US faces Russian war actions is a “national emergency”, worthy of an FDR like approach to “try a few things”. It is an opportunity to overcome individual industry opposition to things that make sense for the country. It is an opportunity to try some left and right solutions.

Good News: Record Voter Turnout in 2018 and 2020 Elections

https://www.fairvote.org/voter_turnout#measuring_voter_turnout

Setting aside turnout ratios, the growth in actual voters has been strong for a century. 40-48M voted in FDR’s elections. Kennedy and Nixon fought over 69M voters. Clinton and Bush, Sr. attracted 105M voters in 1992. But, Biden vs. Trump shattered records with 158M casting ballots.

Midterm Elections: 2018

https://www.fairvote.org/voter_turnout#voter_turnout_101

https://www.census.gov/library/stories/2019/04/behind-2018-united-states-midterm-election-turnout.html

Midterm voting rates (as % of eligible voters) soared at 65% in the 19th century. They dropped to 50% at the start of the 20th century and then down to 45% for most of the 30’s to 60’s. They settled down to 40% thereafter. The 2018 election reached 50%, a full 13% points above the all-time low in 2014.

The slightly different measure, percentage of voting age population, shows the same pattern. 49% voting from 1978-94. Just 46% from 1998-2010. Record low of 42% in 2014, followed by an 11%-point climb to 53% in 2018.

https://www.census.gov/library/stories/2019/04/behind-2018-united-states-midterm-election-turnout.html

Younger voters increased their turnout by 14 points (18-44), while older voters increased by a solid 8%. High school or less educated voters increased turnout by 7 points, while college educated voters added 12 points.

Presidential Elections: 2020

https://www.fairvote.org/voter_turnout#measuring_voter_turnout

Long-term presidential and midterm voting (% of eligible voters) follows the same pattern. 80% turnout in the 19th century, dropping to 59% by 1912, then averaging 60% in the 30’s to 60’s. Further decline to just 55% for the 70’s-90’s. Minor increase to 60% in the oughts and teens, followed by 67% in 2020.

The more recent percent of voting age population shows 64% from 80-88, a one-time spike to 68% in 1992, decline to 59% from 96-200, slight increase to 61% for 04-16, and then a big jump to 67% in 2020.

Turnout was up in all categories, but especially among Asian, 18-29 year olds and white non-college educated populations.

Voting by all racial groups of 18-24 year-olds was up significantly.

Other Sources Show The Same Results

http://www.electproject.org/national-1789-present

https://www.nationalaffairs.com/publications/detail/does-high-voter-turnout-help-one-party

The two measures (% of eligible voters and % of population) track closely. The “election project” numbers show VEP at 63% from 1952-68, declining to 58% for 72-00, increasing a little to 61% for 04-16, before spiking to 66% in 2020.

More Details

Income really matters for voter turnout, with rates ranging from one-third to one-half to two-thirds. With increased lower income support for the Republican party, this is less of a partisan issue today.

https://www.theatlantic.com/ideas/archive/2019/08/emerging-republican-majority/595504/

Since 1969, Democrats have argued that demographic trends will overturn Kevin Phillip’s description of the Emerging Republican Majority. This remains a hotly debated topic.

https://www.census.gov/library/stories/2019/04/behind-2018-united-states-midterm-election-turnout.html

Election day voting decreased in 2018 and 2020 as mail and early, in-person voting increased. Many commentators claim that this change is a large driver of the increased turnout levels.