Ben Roback is Head of Trade and International Policy at Cicero Group.
At rallies and in campaign speeches, Donald Trump proudly boasts of the American economy’s roaring performance since he took office.
He has a point. Whilst supporters of Barack Obama will quickly observe the economic recovery was greater under America’s 44th president than 45th, a 43 per cent increase in the Dow is a commendable achievement.
For that reason, it comes as no surprise that the president has tweeted 347 times including the word “economy”, and 128 times including “stock market”, since he took office.
Analysts and political commentators take a mixed view of the President’s bullishness. Yahoo Finance’s ‘Trumponomics’ report card currently stands at a B+. Three years into his presidency, Forbes gave Trump’s economic performance a mixed review based on 2.9 per cent GDP growth in 2018 and 2.3 per cent in 2019 – describing the impact of the Trump tax cut as a “one-year sugar rush”.
Whilst proof of a resurgent economy, the numbers nevertheless fell short of the six per cent annual growth rate the President forecast in December 2017 with tax reform victory within reach.
A re-election campaign thrown off by coronavirus
With an economy kicking firmly back into gear and Democrats squabbling with one another, Trump and his re-election campaign team will have been growing in confidence about the prospects for four more years in office. But when your legacy – and therefore your campaign for re-election – is based on economic performance more than anything else, what happens when the wheels start to come off the wagon? For that reason, he faces a coronavirus-shaped challenge for political as well as public health reasons.
Wall Street’s nerves give the White House grave cause for concern. Amid huge selloffs, US stocks plunged all week and on Monday and an automatic 15-minute pause in trading was triggered to inject a moment of calm into market volatility. The S&P 500, the Dow, and Nasdaq continue to suffer as the flight to safety persists. The same can be said for the FTSE 100, FTSE 250, the CAC 40 in France, the German Dax and the FTSE MIB in Italy.
All this has the potential to challenge Trump’s central electoral question to the nation: are you better off now than you were when I took office?
The White House’s approach to coronavirus mitigation has been deeply questionable, seemingly motivated by political gain and not the health of the general public. The President’s primary objective has been to downplay its potential impact. Amidst increasing political and economic alarm, he visited the Centers for Disease Control and Prevention (CDC) in Atlanta to tour the facility and outline his administration’s approach to handling what has now been classed as a pandemic by the World Health Organisation.
Given the potential scale of the health crisis the President could have on his hands, it seemed a curious time to be wearing a “KEEP AMERICA GREAT” campaign hat. The substance of his statement was no easier to comprehend:
“As of the time I left the plane with you, we had 240 cases. That’s at least what was on a very fine network known as Fox News. And you love it. But that’s what I happened to be watching. And how was the show last night? Did it get good ratings, by the way?”
It was in stark contrast to the calm and measured press conference the Prime Minister gave in Downing Street on Monday, flanked by the erudite pairing of Chris Whitty, the Chief Medical Officer, and Sir Patrick Vallance, the Chief Scientific Adviser.
If the objective is to carry on business as usual, the President is leading by example, having held six public rallies in the last month. But an evolving health crisis will almost certainly slow that schedule down, let alone looking ahead to November and considering how it could impact voter turnout.
A new poll revealed more than 9 in 10 Americans have seen, read or heard something about coronavirus. This has already become one of the top news events of the last decade in terms of Americans’ familiarity. Dr Brian Monahan, Congress’ in-house doctor, told Capitol Hill staffers that he expects 70-150 million people in the US to contract the coronavirus, according to press reports. For context, that is roughly one third of country.
The White House and US Government must therefore get a tighter grip of coronavirus and treat it as a public health crisis, not a campaign platform.
There is no denying that the response to coronavirus will be viewed through a political lens. After all, a government’s first responsibility is to keep its citizens safe. The White House must therefore not lose sight of the potential political impact on the 2020 election – polling proves the American people are acutely tuned into the Government’s response.