What should Biden be doing differently?

[Beet]

He is in a tough spot. The backlash against globalization is complete in both parties. However, the reality no one in Washington wants to talk about is that globalization, especially trade with China, did lower prices significantly on a huge number of goods. The China-WTO era 2000-2020 was an era of very low inflation. That enabled lower interest rates. The average person got used to both. Rolling it back with a combination of tariffs, bans, and sanctions, and a push for "friendshoring" and industrial policy essentially means trading a pure economic decision for a political one. That has implications.

The conventional wisdom has become that no one who supports trade with China can win in the Midwestern swing states, and that may be true. Everyone, from the Dem elites on down to the average Trump supporter, has told themselves a story that China is to blame for everything and that America's big mistake was to trade with China, and that trade with China has never brought anything good to America. That ignores the fact that trade with China was never done out of charity. It was because China just happens to be very good at making a lot of stuff for a very low price, and utilizing that capability in exchange for paper dollars that the Fed could print at will had benefits for America. Forcibly shifting supply chains to countries in geopolitical favor was never going to be economically optimal and was always going to have costs. It was never going to solve all the problems that we told ourselves were due to China.

Now Biden has the worst of all worlds. There are only about 200,000 more manufacturing jobs today than there were four years ago. After Trump created about 400,000 in his first term. But the 4 - 5 million manufacturing jobs lost in the first two decades of the millenium have not come back. That's due to a combination of increased productivity and manufacturing and imports simply shifting from China to places like Mexico and Vietnam -- where good cost more to make, but still cheaper than in America. The trade deficit has not meaningfully narrowed under Biden -- on the contrary, it is higher today than it was in the globalization era!

The implementation of industrial policy may pay off in the future, but it's not going to happen in time for the election. Meanwhile, we've made a bunch of changes for the sake of sticking it to China that we've told ourselves were supposed to solve problems, but effectively just make the global economy less efficient, and it's coming at a detriment to Biden.

[Beet]

Anyway, what Biden should do based on the above analysis:

1) Feel their pain. Stop pretending prices aren't higher and many things aren't less affordable, including mortgages. Admit that this is causing hardship and show empathy. Admit that a lot of this is due to the decoupling of the world's two largest economies but say that it is necessary to contain China. We all have to belt tighten to beat China and contain it. Turn it into a "what you can do for your country" type thing.

2) Fearmonger like hell over Trump's proposed tariffs that he wants to put on everything. Make ads of ordinary people facing ridiculously high prices and and tie it to Trump's promised tariffs in his second term. Turn the inflation issue into something to attack Trump on. Turn it into a "big loaf, little loaf" election where he's populist from a free trade perspective, like the 1906 UK election.