Failed Bidenomics? From Thatcher and Reagan to Truss and Trump

When Joe Biden won the presidential election two years ago, there was talk of Bidenomics – a kind of reversal of the once powerful Reaganomics. There was suddenly the prospect of an administration that would use trillion-dollar investments, more Social Security, higher taxes on the rich, or a Green Deal to undo the damage done by decades of market fundamentalism and a mistaken belief in a trickle-down of prosperity. An era like the one once ushered in by Roosevelt’s New Deal.

Two years later – and a few days before the mid-terms – it seems clear that Joe Biden is in danger of falling pretty far behind the supposed role model Roosevelt. Sure, there have been impressive programs like, most recently, the Inflation Reduction Act, which is supposed to mobilize an enormous amount of money for climate protection. The drama is: many things failed due to a lack of majorities among the Democrats. And inflation is eating away at much of the improvement that had been planned – including in the labor market, where Mike Konczal of the Roosevelt Institute reports that the situation has improved more impressively than in any upswing in a long time.

That Biden is in danger of losing popular support, however, may also reflect how deep the economic divide runs in the United States. As Nobel laureate Angus Deaton powerfully points out in an op-ed this week, things have gotten drastically worse for a large share of Americans in recent decades. Life expectancy for less-educated men has been fallingsince 2010, and for women even since 1990. Those without college degrees earn less in real terms today than equivalent Americans did in 1970. No democracy can withstand these developments unscathed in the long run.

The diagnosis isn’t new, sure. But when you read it like this, you can’t help but suspect that the loss of confidence in U.S. institutions and elites cannot be remedied in two years – and it would have been difficult even if Biden had always had his own majorities behind him. The drama is: after Tuesday’s elections, that could be the end of it anyway – and thus also of the hope that something will happen in America that corresponds to the New Deal of the 1930s in terms of its stabilizing effect on society. In two years, Donald Trump could even be president again – or someone who is no better. In any case, someone who is running more with loud bluster than with a program that solves the country’s deeper problems. It’s a rather chilling thought.

Is it a coincidence that democratic functioning is so deeply disturbed in precisely those two countries that were celebrated forty years ago as economic liberal role models? That in Great Britain the Thatcher Party today seems so grotesquely lost – and in the U.S. attacks on democracy have become conceivable? Of course not. It’s just so disturbingly apparent these days. And it makes clear how existentially important it is and remains to search for new and better answers. Especially and above all in places, where the situation does not yet seem so crazy.

This text is from our bi-weekly newsletter series. To subscribe, click here.