Competency is Joe Biden’s best strategy

 Competency is Joe Biden’s best strategy

Will President Joe Biden succeed? Like many others, at home and abroad, I desperately hope so. But first we need to agree on what “success” means. It means, above all, restoring order to his country’s politics. That requires making the present direction of the Republican party politically untenable. Without that, hope of restoring democratic stability at home and a leading role for the US in the world may be in vain.

In his heart-lifting inaugural address last week, so different from the rantings over “American carnage” of his predecessor, Mr Biden declared: “We have learnt again that democracy is precious. Democracy is fragile. And at this hour, my friends, democracy has prevailed.” He was right, on all points.

Yet “this hour” is not forever. The forces that brought Donald Trump to power have not vanished. As Princeton University’s Jan-Werner Müller, an expert on populism, remarks, “Populists cleverer than Trump smother democracy slowly through legal and constitutional machinations.” Mr Trump may be gone. Trumpism is not. As the Indian writer Kapil Komireddi has noted, the fusion of big business with bigotry is potent. The US wealthy have certainly prospered. (See charts.)

In the Roman empire, it was said that all roads lead to Rome. This time, they have to lead from it. If the US is not restored to political health, it can do little. The triumph of deceit, incompetence, unpredictability, indifference and xenophobia under Mr Trump has damaged trust in the US among its allies and respect for it among its opponents.

US wealth has been unequally distributed for a long time. Share of net personal wealth in the US (%)

These will not be restored by Mr Biden’s fine words or even such welcome actions as the return to the World Health Organization and Paris climate accord. They will be restored by palpable success at home. Barack Obama was followed by Mr Trump. The next transition might be to someone worse.

As now-confirmed Treasury secretary, Janet Yellen, told Congress a few days ago, “With interest rates at historic lows, the smartest thing we can do is act big”. The administration’s “American rescue plan”, which proposes spending of $1.9tn (around 9 per cent of gross domestic product), is a sensible start. It should, if agreed by Congress, strengthen confidence and support recovery. But will anything like this be passed? Having rediscovered the fiscal rectitude they abandoned in passing Mr Trump’s tax cuts in 2017, the Republicans will surely fight hard to prevent it.

US deaths from Covid have been among the highest. Cumulative Covid-related death rate, per 100,000 population

Yet, as Ezra Klein of the New York Times notes, to succeed the administration needs visible success, sufficient to avoid defeat in the 2022 congressional elections from an already fragile position. The Democrats have to show that government can work, against opposition from a party determined to prove the opposite. Making government fail is the Republican strategy. They will not abandon it.

Timing is everything in politics, much of it luck. Mr Biden may be a lucky leader. Although the economic damage to the US from Covid-19 was far from exceptional, the death rate and the hit to employment have been among the worst. But the combination of vaccination with stimulus might generate a vigorous recovery this year and next.

The US had a relatively mild post-Covid recession.Change in GDP, Q4 2019 to Q3 2020 (%)

Where does the rest of the world fit into this drama? It is a bystander. The Peterson Institute for International Economics has produced a valuable set of essays on what a competent US administration could do for the world, and vice versa. These make clear — notably those by Maurice Obstfeld, former chief economist of the IMF, and Lawrence Summers, former US Treasury secretary — what active US engagement, particularly in the needed global programme of recovery from the Covid crisis, might mean for the world and the US. But good and desirable though such engagement will be, it cannot answer questions about the US’s future role in the world, because that depends on what happens at home.

The US had a relatively severe post-Covid decline in employment.Change in employment, Q4 2019 to Q3 2020 (%)

The next few years may give answers to some huge questions. Will the US be engaged, indifferent or hostile? Can it restore a trusting relationship with its allies? Will it forge a durable relationship with China, which balances the need to compete with the requirement to co-operate, while avoiding severer conflict? Will it play a leading role in dealing with the challenges of the global environment and poverty?

The answer to all these questions will ultimately depend on the biggest question of all: is the US going to return to being a stable democracy? Mr Biden hopes it can be. But if the Republican party is unable to return to being a normal conservative party, remaining, instead, suffused with the lies and fantasies of rightwing populism, the prospects are grim.

Post-Covid net public debt jumped to high levels in many countries.General government net debt as a % of GDP

Many of the underlying racial, social and cultural resentments will remain, as will the political over-representation of the right. But the needed shift can still occur, provided the Biden administration proves rather quickly that competent government by people who believe in it can deliver. It must show Ronald Reagan’s famous statement that “the nine most terrifying words in the English language are: I’m from the government, and I’m here to help” is wrong. Trust in sound and decent democratic governance is not freedom’s enemy, but among its most important guarantees.

In common with many other major economies the US is forecast to recoverstrongly this yearForecasts for GDP growth in 2021 (%)

Who, apart from the administration, can help make this shift work? The answer above all is business and the wealthy. They have been given clear warning of the dangers of marrying pursuit of their interests to the rightwing populism now consuming the Republican party. If they have any decency, they will stop. This is not a game. Mr Biden may be a last chance for US democracy.

martin.wolf@ft.com

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