The explosion of election analysis flying around the internet today, as far as I can tell, has neglected one of the most important factors behind Trump’s victory.
If you only listen to news clips of Trump rambling at his rallies, then this may sound hard to believe, but the MAGA movement has a rich and comprehensive worldview, with a picture of the world as it is and a path to fix it. It’s full of lies, hate and promises that will never be fulfilled, but this worldview is the foundation of the MAGA movement’s power.
The intricate details of the MAGA worldview are preached in thousands of hours of new audio and video content every day across every channel from talk radio to TikTok. This decentralized propaganda machine is subsidized by scores of billionaires, and would not exist without them, but it is primarily driven by the clicks and views of ordinary people. Half the population lives inside this vast filter bubble and has been deeply transformed by it.
Centrists, liberals and progressives have no hope until they develop their own worldviews that can explain the decline of working- and middle-class America and point a way forward.
Unlike MAGA, they can’t “cheat” with hate. It’s a tall order: they need to develop ideas and plans that will actually deliver a better life for the American people — in a context of fierce global competition with an economy plagued by many systemic disadvantages.
The bottom half of American income earners really are suffering. Another third are terrified that they could fall into that bottom half at any moment. The root cause is that generations of politicians and business leaders have been dismantling America’s means of making a living. Part of what made Trump a viable candidate in 2016 was that he repeated this line at every rally: “The politicians dismantled your means of making a living, and I’m going to rebuild it.”
Trump connected with voters by not just feeling their pain but by expressing anger and disgust at the generations of leaders who caused it. Of course, he has no intention of doing anything constructive to change the situation of American workers and the middle class. But his anger is convincing and may even be real. Up against what the Democrats offered, it was more compelling.
Biden did more than anyone since Roosevelt to rebuild the economy. But it was too little, too late — and both Biden and Harris said too little about it. The substantial investments of the IRA, the Chips Act and other programs were imperceptible to the American people when spread all around the country. And even in towns where hundreds of good jobs were created, no one seems to have bothered to tell the locals who made it happen.
Many countries, many times in the history of the past couple of centuries, have rapidly upgraded their economies by making massive investments. Investment on this scale is not at the level of 1% or 2% of GDP — but more like 40% or 50%. It’s hard for today’s policy makers to imagine that because they can’t imagine that much debt. But large-scale industrial investment isn’t financed by the public, rather it is financed by ordinary banks practicing fractional reserve lending. Usually, countries have a system of public or non-profit banks to fill this role — something we sort of have already with the Fed, but which we could add to by creating new real public banks (not loan funds).
At New Consensus, we’re working on comprehensive, detailed plans to give leaders the confidence to promise sweeping economic progress for the American people, to enable them talk about how to make that progress, and to actually deliver it when in office.
I believe that without this missing piece, that the extreme right will continue to dominate American politics and centrists, liberals and progressives will remain politically marooned on an island of empty rhetoric.
Please check out our model plan, the Mission for America. It’s a work in progress. And we could really use your support, your input, or your effort if you are inclined to volunteer. (Email us at team@newconsensus.com!)
The Carnival of Chaos: Trump’s Freak Show of Division and Distrust
How America’s Next Commander-in-Chief Turned the Presidency into a Three-Ring Circus of Fear, Hate, and Manufactured Threats
https://substack.com/home/post/p-151375042?r=4d7sow&utm_campaign=post&utm_medium=web
Banks do not lend from their reserves. Rather, they create new money (new demand deposits for the borrower's account) which on their books is a liability. That liability is wiped out when the borrower repays the principal on the loan (thereby destroying the money). In the meantime the interest on the loan is a revenue source for the bank. Bank lending is not limited in scope by the size of a bank's reserves. It's only limited by the number of profitable lending opportunities available to the bank.
In the same way the federal government spends (creates new money) when the Treasury directs the Fed to mark up the bank accounts of people and firms who sell services to the government. That new money is ultimately destroyed when people pay their taxes with it. The scope of federal spending is not limited by tax revenues but by the scope of real resources available for purchase with the currency issued by the federal government.