Friday, November 12, 2021

BTRTN: Joe Biden Urgently Needs a Chief Brand Strategist

Long before BTRTN, Steve owned an ad agency, and was frequent witness to how a strong brand and an effective communications program can dramatically enhance an organization’s business performance… and how the failure to communicate effectively can cripple an enterprise. Steve thinks Joe Biden needs someone on his team who is totally focused on the Biden brand.

 

So the Democrats finally passed the “hard” infrastructure bill after a journey through the extruder that managed to take a titanic legislative achievement and barely leave a ripple in the news cycle. Indeed, juicy stories of residual seething resentment between the party’s wings seemed to be more the news than the bill itself.

Moderate Democrats were fuming that the Progressive wing’s unwillingness to vote on the “hard” bill months ago contributed to a sense of “do-nothing Democrats” which led to the embarrassing performance in key off-year races.

Representative Abigail Spanberger of Virginia went further, excoriating her own party’s President by saying that “nobody elected him to be F.D.R., they elected him to be normal and stop the chaos.” Hmmm, Abigail, are you really saying that nobody elected Joe Biden to actually do the thing that he spent a year promising the voters he would do? “Build Back Better” was an essential element to his campaign for the Presidency. Did you think he was just kidding? We usually crush politicians for failing to keep promises. Spanberger is breaking new ground in ruthlessly castigating a politician for actually trying to implement the agenda he ran on.

Not to be out-dumbed, Progressives spanbergered back, blaming the off-year election fiasco on the Mod Squad for the appalling intransigence, self-involvement, and CNN-preening of Joe Manchin and Kyrsten Sinema, who each have to be laughing at how much press coverage they milked for their recalcitrance.

Come now, Progressives and Moderates, stop squabbling – you’re both right! You’re both badly damaging the party’s chances in the midterms, and you are killing Joe Biden’s approval rating. Stop it!

Yes, the Democrats have proven they can accomplish something without the slightest help from the Republicans. Unfortunately, it is gridlock. The Democratic Party squandered much of the year they enjoyed a majority in the House and the Senate, and ruled the West Wing, often coming off as a circular firing squad using weapons provided by the assistant director of “Rust,” each and all oblivious to the fact that they were firing live rounds into each other and Joe Biden.

The Progressives’ strategy of refusing to pass the “hard” infrastructure bill without the “soft” bill denied Biden a clear and easy win, and for months made it appear as if this administration could not accomplish anything except foreign policy gaffes. The strategic decision to stall the passage of the “hard” bill substantially delays getting the money out into the hands of Americans, thereby reducing the impact it could have prior to the midterms. The Progressives added a final puzzling soup├žon by changing their minds and proceeding with a vote on the hard bill without the soft bill… immediately after the elections in Virginia and New Jersey. So the primary accomplishment of all that posturing and intransigence was to help defeat Terry McAuliffe and humiliate Phil Murphy… and to surrender their bargaining chip with no guarantee of a “soft” bill after all.

Indeed, if you want to point fingers and find the essential error in this fiasco, it is probably the fact that the Progressives (and Biden!) started their negotiations at six trillion dollars. That’s a number you can toss out if you won the general election with an LBJ-grade electoral mandate, not if you have a paper-thin margin in Congress and know you will desperately need the vote of an ornery fiscal conservative from West Virginia.  For heaven’s sake, Manchin’s original number was $1.5 trillion, which is 12 parcecs from $6 trillion even if you are in the Millennium Falcon.

So now if a “soft” bill is ever passed at say, $1.7 trillion, it is going to come off as a denuded, diluted, deluded undertaking that Joe Manchin dictated. Worst of all: if you retreat from $6 trillion to $1.75 trillion, it sure makes it look like you were padding your initial bill with a boatload of unnecessary spending… which is exactly what Manchin and the Republicans have been saying.

The truth is that a $1.7 trillion soft infrastructure bill will do wonderful, wonderful things for many Americans… but the optics of a flawed negotiating strategy that opened at $6 trillion will make this legislative triumph look like cold pizza crusts two days after the party.  Way to go, Progressives.

The only thing that Washington Democrats seem to truly have in common is that they are all missing the point.

Americans are sick of their own government’s ineptitude, failures, intransigence, infighting, and bickering. The American people want their leaders to work together to get stuff done to help the American people. That – more than anything – is what Joe Biden campaigned on.

And right now, even after passing the original $1.9 trillion Coronavirus relief bill and now the $1.2 trillion “hard” infrastructure bill, the Democratic brand in the United States still somehow seems to stand for infighting, bickering, intransigence, and the self-involvement of lawmakers.

In corporate America, they’d call it a branding problem.

A branding problem is when there is a disconnect between what your product or service actually delivers and how consumers perceive it.

Branding problems can take many forms.

A branding problem is when your phone is every bit as good as the other one, but the other brand is far more desirable because it is perceived to be “cooler.”

A branding problem is when you have a product that is demonstrably superior to the competitor, but consumers fail to see it, believe it, or act on it.

Note that we are not citing examples of product inferiority. If your product actually is not as good as the competitors (think Johnson & Johnson relative to Moderna), that is not a branding problem, but it can lead to a branding problem (“gee, I used to think that Johnson & Johnson was a great company, and then they came up with that lousy Covid vaccine. It makes me wonder if their other products aren't that good, either”).

Branding problems are real. They can have huge business and economic implications: you can’t charge as much for your product as you should be able to charge, and in dire cases, you can find that you lose distribution of your product. Once you have a bad stain on your brand, it can take years and years – decades -- to fix.

The essence of a branding problem is when widespread perception is not aligned with reality. It is not a problem inherent in the product… it is a problem that is squarely lodged in the mind of the consumer.

Very often, branding problems can be traced to failures to communicate effectively. Companies that either do not spend much time focused on the importance of communicating -- or those who simply do it poorly -- are essentially abdicating their responsibility to not simply make good products, but to ensure that consumers understand and recognize their value.

Which brings us to the Presidency of Joseph Biden and the badly tarnished Democratic brand.

Nobody is saying that Joe Biden has had a flawless first year as President, but the Coronavirus relief bill the “hard” infrastructure bill alone are huge achievements, and the passage of yet a third epic “soft” infrastructure bill would rank the Biden administration as among the most activist Democratic administrations in history. Add in steady progress on the battle against Covid 19 in the face of the Delta variant and anti-vaxxer ignorance, and you have a powerful story to tell.

What is the story we are hearing?

The primary communication from Washington Democrats the last two months has been about “hard” and “soft” infrastructure bills (how’s that for consumer friendly language!), about how much the bills cost, about deadlines for votes and then missing deadlines for votes, about how much the Democrats disagree about the bills, and how much personal animosity now exists between the factions of the party. The only discussion of the substance of the bills has been focused on what can, should, and will be eliminated from the bills in order to get them passed.

Democrats seem to forget that complex legislation takes time… the ACA took over a year. But by repeatedly missing wildly over-aggressive “deadlines,” the Democrats exacerbated the sense that no one agreed on the substance of the legislation, and that the bills themselves were flawed.

With a string of bad headlines from Afghanistan to France to the Port of Los Angeles, Biden desperately needed this win. And yet Biden chose to stay on the sidelines, patiently waiting for the temper tantrums to subside, squandering precious time and allowing his Presidency to lose altitude to the point where you can practically hear the automatic cockpit voice screaming “Stall! Stall! Stall!” in the background.

But we should not be surprised. This communication is being driven by beltway bureaucrats speaking in coded insider-speak. None of these people appears trained in the art of mass communication, which focuses less on the words that are being said and much more on what is actually being heard by the average American.

Don’t get me wrong: plenty of Democratic office holders are giving a great deal of thought to how to actually improve the lives of ordinary Americans. It’s just that no one appears to be giving much thought to making sure those ordinary Americans understand what’s being done.

No one is providing aggressive, coherent, continuous messaging to help shape public opinion. In the absence of a thoughtful, concerted, and consistent communication about the Biden administration brand, the narrative of Joe Biden’s presidency is being shaped by others… pundits, Fox News, and even snarky CNN reporters who make a big show of critiquing Biden in order to prove just how objective they are.

You can hate Donald Trump, but he believed that shaping public opinion was so critical to his Presidency that he refused to outsource the job to anyone else. Trump was often characterized as a “great marketer,” an accolade he does not deserve, because blatant, unceasing, and craven lying does not constitute “marketing.” But for Trump, Job #1 was shaping of public opinion of the Trump brand among his faithful.

Trump, indeed, placed so much emphasis on being the personal voice of his administration that he succeeded in convincing his followers that his lies – no matter how egregious – were the truth. And yes, Donald Trump had the benefit of an advertising budget that was literally unmeasurable: every night, Fox News fell slavishly in line to amplify Dear Leader’s every utterance. CNN is nowhere near as pliant and eager to support Biden as Fox News, Newsmax, and OAN were to serve the Kool-Aid for Trump.

Do you think White House Press Secretary Jen Psaki is supposed to be the brand guru? Sure, she is spunky and feisty, but her job is not to manage the Biden brand. Psaki’s job is to ride herd over the Washington Press Corp, and it is refreshing that this job is being done consistently and professionally. But Jen Psaki is obsessing over what Maggie Haberman thinks about Biden… not what voters in Michigan believe.

If there is actually a role in the White House that is to be equated with a “Chief Marketing Officer” or “Brand Strategist,” it should be White House Communications Director Kate Bedingfield, who is actually Psaki’s boss. But even her title speaks to the point that the White House doesn’t really get “branding,” as it implies that her job is “outbound communications.”  A branding expert thinks that the job is first and foremost to understand the mind of the consumer.  Ms. Bedingfield has an impressive curriculum vitae as a veteran of political campaigns. Though she had a brief stint at the Motion Picture Association of America, she never spent time managing a major consumer-facing America brand.

And for lack of someone focused on the business of managing the health of the Biden brand, the Biden administration is being rewarded with a crappy job approval rating.

Joe Biden urgently needs to bring in a “Chief Brand Stratetist” to manage public perception of the Democratic Party and the Biden Administration.

He needs somebody who has spent his or her entire career understanding how ordinary consumers think, gather information, process information, and make buying decisions. He needs someone who is not there to determine policy, but who is an expert in how to communicate with, explain to, persuade the people who buy Charmin, Kentucky Fried Chicken, and State Farm Insurance, and who vote for President of the United States. He needs someone there who knows how to do the type of market research that reveals the emotional needs and desires of ordinary Americans.

A Chief Brand Strategist would not wait four years and then try to tell the story of an administration in the two months prior to the election. A Brand strategist would be waging a pro-active communications offensive to sell these bills to the American public, to make sure that ordinary Americans really understand all the fabulous ways that these “infrastructure” programs are going to make life better. Such a program would give the bills popular support, which would in turn pressure Congress to support them.

A Brand Strategist would not have let Joe Biden call his plan to transform America the “Build Back Better” plan, which sounds like a tepid, milquetoast program intended to merely restore America to some vague past status quo with some marginal incremental improvements around the edges. LBJ’s “Great Society” conveyed soaring aspiration, while “Morning in America” and “The New Deal” at least promised something new. Even “Make America Great Again” – which Trump stole from Reagan – is far more rousing than “Build Back Better.”

What would be better would be to find a slogan that conveys kinetic energy, forward motion, and one that that promises that ordinary Americans in every village, town, and city would see improvement in their lives and opportunities. Building a better America for all.

With a powerful “brand promise,” a Brand Strategist would then map out the specific messaging to support that theme, beginning by setting a precise, measurable, and achievable goal: “By election day 2022, the majority of Americans should be able to name the four most important components of Biden’s “Build Back Better” program: (1) support for families by virtue of universal preschool and extended Child Tax credit, (2) the largest investment to combat climate change in the nation’s history, (3) expansion of affordable health care, and (4) strengthening the middle class through affordable housing.”

A Brand Strategist wouldn’t sit around and let Joe Manchin run roughshod over the White House. A shrewd marketer would run millions of dollars of advertising in Wheeling to explain to West Virginians just how much ordinary citizens in the Mountain State would benefit from the infrastructure bills. Then watch what happens when Joe Manchin discovers that a huge percentage of his voters would be pissed off if he continued to oppose the legislation. That is marketing.

And, yes, an ongoing advertising campaign is essential. This does not mean spending Federal budget dollars on tv commercials. Rather, the Democratic Party should take a good close look at how Verizon, Chase, and McDonalds build brand imagery and loyalty through national advertising campaigns that run year round, year in, year out, all to establish a strong, clear, consistent understanding of their brands.

The Democratic Party should be running commercials talking about all the features of the “Build Back Better” legislation, and – now that at least part of it is passed – focus advertising on case histories about how it is improving lives, providing jobs, and raising the standard of living all across America.

Key to a successful ad campaign? Don’t bother running commercials on CNN and MSNBC. You’d be preaching to the choir. Run ads on the NFL, popular daytime talk shows, and programming that speaks to personal interests (cooking, home improvement) to reach those who get their news from Fox, and those who do not regularly watch news programming.

A smart communications program won’t solve everything, but it could have helped Biden even in the darkest moments of his year. Yes, Afghanistan.

Branding is all about pro-active communicating: getting out in front of the media with your message that is clear, persuasive, and pervasive. Somebody should have been out in front of the Afghan withdrawal with messaging, communicating that Americans should not be fighting a civil war for the Afghanis, and that if the Afghani people, government, and army did not choose to defend themselves from the Taliban, then the young men and women of our armed services should not be doing it for them. Biden should have made sure that the American people heard the message… as well as the Afghanis themselves.

Biden’s best communication effort? By and large, Biden has done a good job of aggressively advocating for vaccination against the Coronavirus, elevating the intensity of the national debate by allowing his emotions to show and by publicly spanking Southern governors for their politically motivated opposition to mandates.  Still, we look at the diaspora of messaging out of Federal, State, and local governments and remained generally baffled by the absence of coherent, integrated messaging on this most vital of topics.

Communicate!!! Tell people what you are going to do, why you are doing it, and how it will it make their lives better!

The overall grade for this administration’s communication is not good, as measured by the weakness of the brand -- the gap between perception (his approval rating) and the reality (legislative achievements and progress on Covid-19). There may be a simple reason why: there’s nobody in the White House who thinks like a brand strategist, no one whose entire job focus is the health and vitality of the Biden brand.

The Democratic National Committee should find a person who has been leading the messaging for a major corporation in a consumer goods and service category, and ask them to lead a new department of public communications for the Democratic Party.

Joe Biden’s approval rating is frightening evidence of a classic branding problem. He has done a better job as President than he is being given credit for, and he has from now until the midterms to fix the disconnect between perception and reality. He needs an expert who knows how to align public perception with reality.

It is time for Democrats to make that vital task somebody’s full time job. It is time to hire a Chief Brand Strategist.  

 

 

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Thursday, November 4, 2021

BTRTN: Not the End of Biden's Beginning

Tom with the BTRTN October 2021 Month in Review.

Winston Churchill was on a losing streak in 1942.  Sure, he had notably transformed the UK from a country that cheered the appeasement strategy of his predecessor to a spine-stiffened nation that would “fight on the beaches” and anywhere else the Germans waged war.  But the war effort itself was proceeding miserably, the Germans rolling through France and North Africa, their U-boats destroying convoys carrying tons of desperately needed supplies across the Atlantic, an ill-conceived British adventure in Greece, the galling surrender of 130,000 British troops in Singapore after desultory and brief fighting, and more.  The rumblings against Churchill’s government began; while he remained personally popular, the critiques of his war-making capability, earned from disasters in Churchill-sponsored excursions in Gallipoli in 1915 to Norway in early 1940, began anew.


But finally, in June of 1942, British forces under the command of Generals Alexander and Montgomery defeated Erwin Rommel at El Alamein, a momentous event that brought forth another of Churchill’s most memorable quotes:  Now this is not the end. It is not even the beginning of the end. But it is, perhaps, the end of the beginning.”

 

Now Joe Biden is no Churchill in either his power of oratory or his ability to motivate a nation.  But he too faced challenges of epic proportion when he assumed office, directly related to the policies and practices of his predecessor:  the ongoing COVID crisis, and a challenge to the twin pillars of American democracy, the integrity of our voting process and the peaceful transfer of power.  And, like Churchill, who galvanized British fighting spirit in those early days, Biden too had early wins, notably in jumpstarting Trump’s anemic vaccine distribution program, the passing of the epic $1.9 trillion American Rescue Plan and, in general, the return of decency, honesty, empathy, an adherence to facts, a reliance on science, and a reversion to the norms of American political life, all of which won him plaudits.

 

But then came the losing streak – in part self-inflicted (the dismal exit from Afghanistan, the diplomatic flap in France, the mistaken assault on ISIS-K in Afghanistan that resulted in tragic civilian deaths) and in part not (the rise of the Delta vaccine, the resultant slowdown in the economy, the global supply chain crisis, the rise of inflation, the re-solidification of the GOP under Trump).  The verdict on his performance, while not completely disastrous as yet, has been clear, in both the decline in his approval rating (see below) and in the governor races yesterday that saw the defeat of Terry McAuliffe in Virginia, and a way-too-close victory in New Jersey by incumbent Phil Murphy – two blue states that Biden carried by double digits just a year ago.

 

Biden’s El Alamein – what he needs to end his losing streak -- are his two massive pieces of legislation, the $1.2 trillion “hard” infrastructure bill, and the $1.5 to $2 trillion “soft” infrastructure bill.  As of this date, the hard bill has passed the Senate in bi-partisan fashion with room to spare, and has majority support in the House.  The “soft” bill is still being negotiated.  Biden announced a $1.75 trillion framework for the soft bill that appears to have broad support. It received the endorsement, at long last, of the House’s progressive wing, but nailing down an agreement remains maddeningly elusive.

 

And so Biden is not having his El Alamein moment as yet.  The legislation has been waylaid on its tortuous path by the progressive’s insistence on passing the two bills simultaneously, the intransigence of Democratic centrist Senators Joe Manchin and Kyrsten Sinema, with occasional grenades lobbed in by both Bernie Sanders and even “Mod Squad” House centrists, usually a quiet bunch.  The two bills are certainly too big to fail, and odds on will be passed soon.

 

The mainstream media has not been Biden’s friend in the legislative process.  They are covering it as if it were a baseball game, with excruciating detail, as all of the infighters posture and preen.  This is a classic case, to use another metaphor, of the sausage-making becoming the story.  We forget – we have forgotten – what it takes to pass historic social legislation, which is precisely what Biden is after.  The 1964/65 Civil Rights legislation was a century in the making, complete with a weak predecessor in 1957 – and let’s not forget the 54-day filibuster in the Senate in the early months of 1964 after the House had passed the Civil Rights Act -- back when filibusters were “real.”  The most recent massive piece of social legislation, the Affordable Care Act in 2011, took 13 months, and Obama had 60 votes in the Senate (at least until Ted Kennedy died).  The easiest part of this one has turned out to be working with GOP Senators on the hard bill; the entire GOP congressional delegation is sitting out the soft bill, which is shameful, given its overall popularity with the majority of Americans.

 

If at some point Manchyma, Sanders, the Mod Squad and the House progressives stop playing musical chairs, and all sit down together with Biden, Pelosi and Schumer and pass both bills, Biden will have an historic win on his hands.  Biden’s framework features an extraordinary expenditure to fight climate change, money to subsidize child care and universal Pre-K education, a tax break for parents, hearing care for the elderly under Medicare, in home care, a fix for the Medicaid “gap,” some Obamacare fixes, job training, some immigration reforms, housing assistance, tuition aid, child nutrition funds and more.  And that’s just the “soft” bill.  Altogether the two packages, coupled with the American Rescue Plan, would in scope easily stand alongside the efforts of FDR and LBJ to reshape the life of ordinary Americans.

 

It is fair to say that the Democrats have, to date, vastly under-marketed the poorly named “Build Back Better” plan, which pales alongside the high concept simplicity of the New Deal and the Great Society.  Hardly anyone knows what is in these bills – the focus has been almost entirely on what they cost and what is being left out in the compromises -- and how it will help virtually everyone in America.  Biden’s challenge, once the bills are passed, is to sell the benefits, and ensure they are executed promptly.

 

The news of the rest of the month failed to penetrate the play-by-play of the bill, but there were many other notable items.

 

Job One for Biden remains getting COVID-19 under control, and by and large it was a good month.  New COVID cases dropped 40% in the month, from 3.6 million to 2.2 million, and deaths dropped by 22%, from 59K to 44K.  The unvaccinated continued to constitute the vast majority of both groups, yet vaccinations increased only marginally.  Only roughly 6 million more Americans were fully vaccinated in October, increasing the total to just over 191 million, anemic progress.  About 19 million of those who are vaccinated received a booster shot, and children aged 5 to 11 will soon be getting shots in their arms – if their parents let them.  These rates of change are simply too slow, leaving the country with very high new case levels and low vaccination rates, and no unified sense of purpose.

 

The economy finally took the expected bath associated with the rise of the Delta variant, with GDP growth slowing to 2% (annualized), inflation continuing at 5%, and a second straight month of anemic job growth (under 200K).  The term “stagflation” has begun to be bandied about, but it is a wild exaggeration.  Jimmy Carter would have killed for numbers like that; inflation hit 13% during his administration, and GDP growth ground to a halt entirely.

 

This month many Americans learned about the term “supply chain,” which refers to how goods get from the factory to either retail shelves or your doorstep.  This has been a hot business topic for decades, when “just-in-time inventory” became the rage, but has come into view as shortages have developed, much like an otherwise capable referee suddenly becomes the focus after making a terrible call.  Rising consumer demand in this semi-post-COVID economy, coupled with a labor shortage, have combined to leave alarming levels of goods still at sea, and now the Biden Administration is scrambling to fix a business problem for which it is being blamed.  We are learning exactly how vulnerable we are to the split second timing requirements that enable “just in time.” 

 

The Supreme Court turned down a second request to shut down the Texas anti-reproductive health bill, but the three liberals and John Roberts forced a consideration of the law onto the docket on an urgent basis.  The constitutionality of the law would not be reviewed at this time per se, but rather the nature of the law, which puts enforcement in the hands of citizens, not the state, will be reviewed – specifically, whether such a constructive precludes federal court review, and whether injunctive relief can be granted.  Oral arguments were heard earlier this week.  The Texas law has given real juice to Democratic electoral prospects, and the odds of the Supreme Court ultimately striking down the Texas law rose considerably when Brett Kavanaugh asked the right question immediately: if the law could be a model for similar laws that could limit gun rights and free speech.  The answer was “yes.”  But while the Texas debacle may be expunged, the fate of Roe v Wade remains front and center, as the court will also soon hear arguments that may result in the death or severe curtailment of Roe.

 

The House Select Committee to Investigate the January 6th Attack on the Capitol (as the committee is formally known) finally showed some fight by recommending to the full House (which approved) that Steve Bannon be prosecuted for contempt of Congress in failing to respond to a subpoena to appear before them.  Bannon is a key witness because he was clearly involved in the planning of the insurrection, and in close contact with Trump on that topic.  Bannon stated that he was yielding to Trump’s claims of executive privilege in declining to appear.  This is a specious claim, given (a) Trump has no authority to claim executive privilege, that is now solely in the province of Joe Biden, and (b) even if Trump had that authority, it surely could not be extended to a private citizen, one who had not worked in the White House for three years.  Now comes the wait for Merrick Garland to act on the House recommendation.  All of this buys time, because the Trump/GOP game is to lawyer the Committee to death, with machinations to delay any cooperation until after the midterms presumably flip the House to the GOP, so they can kill it.

 

The month ended with Biden off in Europe in something that is amounting to an apology tour of a kind.  Biden met with the Pope in a warm greeting of the two most powerful Catholics in the world, and emerged with the Pope’s blessing of Biden’s receiving communion, despite his position on abortion, which conservative American bishops had been vocal in opposing.  Then he moved on to a private meeting with France’s Emmanuel Macron, essentially apologizing for undercutting France without warning on a submarine deal with the Australians.  After a day at the G20, Biden moved on to the 2021 U.N. Climate Change Conference (a.k.a, COP26), where he more or less apologized that Trump took the U.S. out of the Paris Accords.  Biden’s strength on the climate change issue was undercut by the failure of Congress to produce the “soft” infrastructure package in time for the COP26, but this miss was assuaged by the sheer enormity of the commitment outlined in his framework.  But all of these good intentions only matter through action, and only time can yield the opportunities for Biden to turn the words into action.

 

And he has that time.  While the Virginia and New Jersey election outcomes surely reinforced how far he has fallen in his 10 months on the job, he is still very popular with Democrats and has the table set for a good 2022, if he can get the dominoes to begin to fall.  He needs the two bills, first and foremost -- “the end of the beginning” -- and then a little luck, that no new variants as powerful as Delta emerge that wreck progress against COVID.  If those two dominoes fall into place, the economy should follow, and if he can act on a more sure-footed basis on foreign affairs – totally on him -- he will have a better story to tell next year at this time.  


It's not that simple, though.  Biden and the Democrats need to find a way to get to the daily issues faced by middle America, notably the culture wars in schools, the price of gas and inflation.  Youngkin may indeed have found a winning post-Trump formula, and the Democrats can hardly be dismissive.


And, of course, Biden will have to deal with all the surprises and challenges that will surely emerge in 2022.  After all, Churchill hardly rested with the end of his beginning.

 

 

MADNESS

 

In this “Madness” section, it is hard to avoid the insanity of Trump announcing to a group of supporters, without any prompting, that he is not actually a fan of “golden showers.”  He went on to say that this was the one part of the Steele report that Melania actually did not believe.  That implies, of course, that Melania believed the rest of it.

 

But we also focus on the least surprising headline ever (although it was rather under-reported in the mainstream media):  “Trump Deal May Have Skirted the Law”.  It went on to report that in creating his newly-hoped-for social media company/empire, Trump needed to secure $300 million in funding, and to do so he created a SPAC.  That is perfectly legal, but he also held discussions with another company that would merge with the SPAC into prior to the IPO, which is illegal.  SPACs are essentially empty vessels, but are allowed to merge with existing entities post-IPO, not before, nor can any discussions to that effect take place.  We can only hope the SEC shows more gusto and success in punishing him than so many other investigative bodies thus far.

 

 

BIDEN APPROVAL RATING

Joe Biden finally stopped the bleeding on his approval rating after consecutive months of three-point drops, as he remained at 45% and a net approval rating of -4.  This remains Biden’s low water mark for his presidency. 






HOW BIDEN IS HANDLING KEY ISSUES

While his approval rating held, Biden lost ground in the assessments on how he is managing various key issues, in particular foreign policy, where he took a beating, dropping in one month from 45% approval to 38%.  He also lost six points on immigration, and three to four points on the economy and COVID.  The only area where he stood ground was the overall “on the right track” number, which, while at a dismal 32%, is still light years ahead of where it was when Trump left office (20%).

He is also still substantially outperforming Trump’s ratings at the time he left office on COVID management, but now trails him in foreign policy and, in particular, the economy. 


BIDENOMETER

The “Bidenometer” dropped significantly in October, moving from +63 in September to +38.  The drop was driven by the latest GDP figures, which showed only 2% growth in Q3, down from 6%.  The price of gasoline also rose, but these measures were mitigated in part by a slight rise in consumer confidence, a drop in unemployment, and a rise in the stock market. 

As a reminder, this measure is designed to provide an objective answer to the legendary economically-driven question at the heart of the 1980 Reagan campaign:  “Are you better off than you were four years ago?”  We reset the Bidenometer at this Inaugural to zero, so that we better demonstrate whether the economy performs better (a positive number) or worse (a negative number) under Biden than what he inherited from the Trump Administration.








With a Bidenometer of +38, the economy is clearly performing much better under Biden compared to its condition when Trump left office.

This exclusive BTRTN measure is comprised of five indicative data points:  the unemployment rate, Consumer Confidence, the price of gasoline, the Dow-Jones Industrial Average and the U.S. GDP.  The measure is calculated by averaging the percentage change in each measure from the inaugural to the present time.

Using January 20, 2021 as a baseline measure of zero, you can see from the chart below that under Clinton the measure ended at +55.  It declined from +55 to only +8 under Bush, who presided over the Great Recession at the end of his term, then rose from +8 to +33 under Obama’s recovery.  Under Trump, it fell again, from +33 to 0, driven by the shock of COVID-19 and Trump’s mismanagement of it.  Now we have seen it move upward to +38 under Biden.

 

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Notes on methodology:

BTRTN calculates our monthly approval ratings using an average of the four pollsters who conduct daily or weekly approval rating polls: Gallup Rasmussen, Reuters/Ipsos and You Gov/Economist. This provides consistent and accurate trending information and does not muddy the waters by including infrequent pollsters.  The outcome tends to mirror the RCP average but, we believe, our method gives more precise trending.

For the generic ballot (which is not polled in this post-election time period), we take an average of the only two pollsters who conduct weekly generic ballot polls, Reuters/Ipsos and You Gov/Economist, again for trending consistency.

The Bidenometer aggregates a set of economic indicators and compares the resulting index to that same set of aggregated indicators at the time of the Biden Inaugural on January 20, 2021, on an average percentage change basis. The basic idea is to demonstrate whether the country is better off economically now versus when Trump took office.  The indicators are the unemployment rate, the Dow-Jones Industrial Average, the Consumer Confidence Index, the price of gasoline and the GDP.

 

Monday, November 1, 2021

BTRTN Election Prediction: When a Split Verdict in VA and NJ (Bad Enough) is Really a Double Loss

Tom with BTRTN predictions in tomorrow's Virginia and New Jersey gubernatorial elections.

This is an “off off year” election, meaning, as in all odd-numbered years, there are no congressional elections (apart, perhaps, from special elections caused by death or resignation) and no presidential election.  But there are gubernatorial races in Virginia and New Jersey that are critical on many levels.

There has been a decade-plus-long trend toward the nationalization of local elections, amply evidenced by the decline of “ticket splitting,” that is, voting for different parties in different races in the same election cycle.  That means that off-cycle elections such as these two can serve as barometers of national trends.  And certainly these two elections will serve as a referendum on Joe Biden’s brief presidency, no matter how hard the Democrats try to lash their Republican challengers to Donald Trump.

As such, political observers will be watching two sets of numbers – not only who wins, but also how the margin compares to Biden’s margin of victory in the two states in last year’s election.  The expected decline will give a rough gauge of how far the country has shifted from blue to red, given Biden’s well-documented troubles.


VIRGINIA

Biden won Virginia by +10 points last November, as Virginia has long completed its move from a purple state – one that George W. Bush won twice in 2000 and 2004 – to a blue one that has since gone for Obama twice, Hillary Clinton and Joe Biden.  Democrats have won the state house in four of the last five elections, starting with the two current Senators, Mark Warner in 2002 and Tim Kaine in 2006.  They were followed by Republican Bob MacDonald, then Terry McAuliffe and the current incumbent, Ralph Northam.  Northam won by +9 points in 2017 over veteran GOP operative Ed Gillespie.

This race, featuring the potential return of McAuliffe, pitted against Republican businessman Glenn Youngkin, will be a tight one, to say the least; at this point it is a genuine toss-up. 

McAuliffe is a national figure who was head of the Democratic National Committee from 2001 to 2005, and a famous money raiser and friend of Bill and Hillary Clinton.  (Gillespie was his counterpart as head of the Republican National Committee during some of McAuliffe’s years there.)  Youngkin is the former co-CEO of The Carlyle Group, one of the largest private equity firms in the world.  McAuliffe has been touting his former stewardship of Virginia, while distancing himself from Biden, while Youngkin has been focusing on local issues while attempting to neither embrace Trump nor enrage him.  If Youngkin wins, his blueprint will be copied in many congressional races in 2022.

The polls show a dead heat as of this moment, in a race that has steadily narrowed from a 5-point McAuliffe lead in August.







Predicting the outcomes of “toss-up” races is, naturally, fraught with peril, particularly during COVID when the entire electoral process has been transformed, with far more emphasis on early voting, including mail-in voting.  But we have done quite well here at BTRTN.  In the 2020 elections, there were 14 races that were rated “toss-ups”, seven presidential states and seven Senate races.  (There were no governor races that were toss-ups, and we use a different methodology for House elections.)  Among those races, we called 11 of them correctly, which is much better than flipping a coin.

There are other factors one takes into consideration, even in non-toss-up races (though polls, despite their widely publicized faults, are almost universally accurate once you get out of the margin of error).  But when the polls are even, one tries to sift through the other data points, however subjective, to try to divine the outcome.  Here is how the Virginia race stacks up on these other factors.

·        Momentum.  As noted, the polls have been moving toward Youngkin.  This type of inexorable movement is hard to reverse. 

·        Outliers.  Within the “dead heat” polling averages, there is a single poll (FOX, who runs a respectable polling outfit)) from a few days ago that had Youngkin up by +8.  If one removed this single “outlier” poll, Youngkin’s +0.4 advantage in recent polls would flip to McAuliffe by the same +0.4 margin. 

·        Lead Within the Margin of Error:  This is important: just because a lead in the average of recent polls is within the margin of error, that does not make the race a coin flap.  The candidate that leads by a “scientifically insignificant” margin has a slightly better chance of winning.  Youngkin has the slim “lead” if you include the outlier, which is bolstered by the fact that the two most recent polls each have Youngkin up by +2 points. 

·        Early Voting:  More than 1.1 million Virginians have voted early, considerably less than the 2.7 million in the 2020 election – to be expected in an “off off” year – but triple the early voting in the 2017 gubernatorial race.  Despite Youngkin’s encouragement of early voting (a change from Trump, who denigrated early voting, which surely hurt him), Democrats have dominated the voting to date, with estimates in the 55% to 30% range, higher than the +9-point advantage Joe Biden enjoyed in early voting in 2020.  However, Republicans will make up that margin on Election Day; Trump won that day’s vote by 25 points.  It wasn’t enough, by a long shot, but the percentage of people voting in person tomorrow will almost surely be higher than last November. 

·        Enthusiasm:  A Monmouth University poll found that Youngkin had a 23-point advantage over McAuliffe in the percentage of voters saying they were “excited” to vote for their candidate. 

·        The Money:  Here the two candidates are also in a dead heat, as both have raised (or borrowed) and spent roughly $50 million. 

·        Get Out the Vote:  Both candidates claim huge voter turnout machines, and there is no clear way to give one an advantage over the other. 

·        Surprises:  There were two potential game changers, the passage of the two infrastructure bills, which would have helped McAuliffe, and a last minute entry into the campaign by Trump, which likely would have helped McAuliffe as well in a state that he lost handily.  Neither has materialized as yet, though the Trump radio show call-in is still a possibility, and at this point both bills seem destined for passage.

The preponderance of these factors is hardly definitive.  Most seem to favor Youngkin, a few are even, and only the early voting pattern points to McAuliffe.  And so we make our call:

BTRTN predicts that Glenn Youngkin will become the next Governor of Virginia by a 49-48 margin.

It is very difficult to figure out in the course of the evening how the election is going.  In November, because the red downstate vote was counted before the blue northern suburbs, AND the mail-in vote was counted last, Biden was down by 17 points at one point early in the evening.  He came back to win by +10.  But this time around, the mail-in votes will be counted first, so McAuliffe may look good.

It will certainly still come down to the late counting northern suburbs.  For a bellweather, keep an eye on Loudoun County.  This is an affluent northern suburb that has switched from red to blue over the last two decades, but has become the scene of a highly publicized brawl over masks in schools and school curriculums.  If Youngkin is able to stem the tide Loudoun, and, even if he does not win, make it competitive, it is major trouble for McAuliffe.

Polls close at 7 PM Eastern time.


NEW JERSEY

The New Jersey race is more straightforward.  Incumbent Democrat Phil Murphy is a solid favorite to win over former state Assemblyman Jack Cittarelli.  New Jersey is, of course, a deep blue state, and Murphy won the state house in 2017 by a 15-point margin.  Biden won the state by +19 points in 2020.

The polling has clearly been in Murphy’s favor, though it too has narrowed, from a 13-point margin in August/September polling down to an 8-point margin in October, including one poll that has it at only +4.

BTRTN predicts that Phil Murphy will retain his seat and continue as Governor of New Jersey by a 52-45 margin.

New Jersey’s polls close at 8 PM.


WHAT IT MEANS

So on the whole, it looks like a split decision for the Democrats, retaining New Jersey but losing Virginia.  But regardless of whether McAuliffe pulls it out in a squeaker, the two outcomes will really count, in terms of its meaning, as a double loss for Biden and the Democrats, boding a potential disaster in 2022.  A roughly ten-point shift in these two races from November 2022 to November 2021, if rolled forward to 2022, would mean the loss of both the House and the Senate, and perhaps both by wide margins.  In the Senate, the Democrats are defending four seats that will be in play – Georgia (Warnock), Arizona (Kelly), New Hampshire (Hassan) and Nevada (Cortez Masto).  They also had hopes of picking off five GOP seats that are vulnerable, three in which the incumbents are retiring (Ohio, Pennsylvania and North Carolina) and two others, Florida (Rubio) and Wisconsin (Johnson).  A ten-point swing would dash all those hopes and leave the Democrats with a 46-seat minority.  The Dems could also lose 30-40 seats in the House.

None of this is set in stone.  Biden has a year to get his administration back on track.  This would involve passing his two bills, taming COVID (with no new variants), fixing the supply shortage, holding off inflation, spurring growth, continuing to drive down unemployment, demonstrating steadier hands in foreign affairs, and so on.  Though a daunting list, it is far from impossible.  But, as has been documented time and again, most presidents take a licking in their first mid-terms, and many – including Ronald Reagan, Bill Clinton and Barack Obama – learn well from their errors and put together successful reelection campaigns.

If tomorrow’s final polls cause us to rethink our predictions, we’ll be back!