What is "the Economy," and Why Do We Vote for It?

Also: the best hour of TV for Generation X; why teens are too "entitled" to drive; and an appreciation for newsletter readers

Howdy, and thanks for reading. Just a quick appreciation for you before things get started.

Writers on Substack have been swamping Notes recently to express their gratitude for their newsletter audiences. Unlike social media, people generally don’t hate-read newsletters or troll the writers they don’t like. Some people make hating Matt Yglesias or Taylor Lorenz their entire personalities on Xitter, but then don’t subscribe to their newsletters, nor should they. So while social media has gotten more rancorous, dumber, fleeting, and stained by bots and AI slop, the newsletter business has built opportunities for those who want to go the other way, both as consumers and producers. (I probably subscribe to 20 newsletters now, and I pay for at least three of those.)

On Tuesday, I posted something to Threads, and it did numbers, as the kids say.

Now I probably don’t need to tell you that most replies were from strangers. A lot of them were people fighting with each other. I could probably rewrite this post as “The American culture war in one reply thread.”

Anyway, my posts on Threads are more likely to take off and get a lot of attention than any other social media platform. And now I understand how unfulfilling and annoying that is.

But you, precious reader, you’re special. I haven’t added very many subscribers to Rangelife in the past couple months, and that’s cool because I’m not seeking to reach a million strangers or monetize anything. If you like what you read here, and you want to share it with people you think might appreciate it, then I invite you do so.

College is not 13th grade

My daughter is in college now. I wasn’t prepared for is how suddenly I would be uninvolved in my child’s education. No school communications, teacher conferences, or report cards. Just nothing. The kid is in charge now.

At one point this summer, I had to ask her, “Are they going to, you know, request tuition at some point?” And she had to go find the email where they explained how and when to do that.

We dropped her off last weekend, at a college that’s three time zones away. I cried a bunch of times. I’m not usually a crier. Sometimes I’ll watch a particularly emotional movie with my wife, and then she’ll see my dry-ass eyes and suspect she married a psychopath.

But the college dropoff was too much. Sending your kid off into the world, even a temporary place like college, is a massive and permanent change to the family structure. It feels a bit like a small death, not of a person but of what our family was and how it worked. We had one kid for a couple years, and then we had two for about 14 years, and now we’re back down to one. And in another four years, the nest will be empty.

The idea of the fully empty nest seems powerfully sad right now, but also I can remember having two little ones around, and fantasizing about the day that our lives could be our own again. It turns out you don’t have to wait until college for that day, especially if you live in a city where they don’t need to be chauffeured around everywhere.

Jesus, Take the Wheel (from My Teenager)

Speaking of which, teenagers are driving a lot less these days. Over the past 40 years, the number of 19-year-olds with a driver’s license has plummeted from 87% to under 69% (WSJ, gift link). A major reason is cost — it just takes more hours of work to pay for a vehicle, insurance, and fuel than it used to. But another reason is that a lot of teens just don’t really want to drive.

I learned about this story from LinkedIn, where a lot of middle aged people used it as an opportunity to criticize young people for growing up differently from our One True Perfect Childhood. (I wonder what percentage of teenagers had driver’s licenses in, say, any decade in history before the 1960s.) I don’t really understand how not having a license and a car makes someone “entitled,” but I saw that word a lot to describe Gen Z for taking the bus instead of spending all their money insuring their hand-me-down Honda Civic.

As a parent, I’m perfectly happy not having my kids driving or riding with other teenagers. Teens driving with other teens in the car are notoriously dangerous, and they’re even more likely to crash than legally drunk adults.

Oh, they don’t allow freshmen to have cars at my daughter’s college? Sweet.

What is “the Economy,” and Why are People Always Voting about It?

When the Cold War ended, one of the lessons we thought we learned was that prosperity requires democracy. The evidence was pretty clear: the global economy was dominated by the US, Western Europe, the UK, and Japan. All of these countries had democratic systems, while the world’s dictatorships were either poor and undeveloped (China, most of the global South) or collapsing (USSR, Cuba, Argentina).

I was taking my first political science classes in college at this time, including one called “From Dictatorship to Democracy,” taught by a professor visiting from Hungary. This was ostensibly a course about the transformation of the former Eastern Bloc. About halfway through the semester, we had to revise the entire course because the USSR broke into pieces. Some of those pieces are thriving democratic economies today, some are still broke-ass dictatorships, and some like Russia seemed like they were heading in the good direction and then slipped back.

But in the 30+ years since the End of History, something weird happened. The ten fastest-growing economies since 1990 are mostly dictatorships: China, Vietnam, Qatar, Kazakhstan, Angola, Singapore, India, UAE, Azerbaijan, and Bangladesh¹.

China is the prime example for this disconnect. In my college classes, I read a lot about how exposing dictatorships to international trade and capitalism, would inevitably liberalize their political systems, too. Then we would have world peace because democracies never go to war with each other.

Yeah, no. It turns out that economic growth and broadly-distributed prosperity are really complicated and driven by all kinds of factors. Governments at their best provide for physical, legal, and regulatory infrastructure that allows an economy to operate freely and competitively. They also build international systems (and even empires) to help them exploit other economies and keep people from shooting at each other. They prosecute corruption so investors will have confidence that their money won’t get taken.

These all take years or decades to build and nurture. This pace is completely disconnected from the political cycle.

In the USA, every four years we vote for a President. Much of this vote will depend on how people feel about “the economy,” but “the economy” in this context is a euphemism for how people feel about the vitality of their communities.

“The economy” is not just how someone’s feeling about their own finances. For example, in April, 46% of adults told Gallup that their financial situations were “excellent” or “good,” and only 17% said it was “poor.” But in that same poll, only 24% said economic conditions in the USA were “excellent” or “good,” and 44% said the national conditions were “poor.” So this means a lot of Americans think they’re doing fine, but that they’re the exception and most people are doing worse.

Maybe this is just another Dunning-Kruger thing, like how 73% of adults think they’re better than average drivers. Or maybe it’s just hard to be positive about economic conditions when you see people struggling. “How’s the economy” may mean “How many people are begging at intersections? How many storefronts are vacant at my regular strip mall? How much am I paying to fill my F-150?”

Or it could also mean “How do I feel about the President of the United States?” The University of Michigan monthly consumer sentiment report is considered an authoritative barometer of how Americans are feeling about their willingness to spend money. And the connection between how one feels about the economy and the president is pretty stark.

What you may notice above is that at the start of 2020, before the pandemic hit, Republicans thought American was experiencing an economic Golden Age. And they weren’t entirely wrong — we were already 12 years into the recovery, unemployment was as low as ever, and labor shortages were driving higher wages. One of the unsung great things about the Trump-era economy was that people at the bottom were making more money and income inequality was actually shrinking!

Everybody’s sentiment swan-dove when pandemic sent the economy into shock, but you’ll notice in late 2020 how disconnected consumer sentiment is to the real economy. Democrats suddenly had new consumer confidence, and Republicans said things were suddenly worse than in the depths of the pandemic shutdowns. What could have possibly happened then? Since early 2021, Republicans have reported that we’re in some kind of depression.

So every four years, we hear that “the economy” is the most potent issue. Which is weird because (1) this is always the case no matter the actual state of the economy, and (2) a politician has very few tools available to improve job creation, salary levels, or prices over the course of a term of office. (But they do have a lot of tools to make them worse.) The things that a president can do for the real economy usually won’t have an impact for another administration or two.

If you watch any voter panels these days, you’ll see people express a lot of dissatisfaction about prices. In fact, people who maybe voted for Biden in 2020 but are considering flipping for Trump in 2024 will generally express the same reason why: groceries and gasoline were cheaper under Trump. (And sometimes they’ll even express personal gratitude to Trump for the federal stimulus checks that he at first opposed, but then smartly ordered Treasury to print his signature on.)

Someone recently pointed out that if Kamala Harris wins the presidency, she’d be the first Democratic president since LBJ in 1964 to inherit a strong economy. I had to really think about this, but this is correct: Carter (1976), Clinton (1992), and Obama (2008) all benefited politically from recessions while they were running for office, and the latter two benefited again from those recessions reversing course during their first term. (Carter’s economy was buried by OPEC.)

Bill Clinton mentioned in his DNC speech that since Reagan left office, Democratic presidents created almost all the net jobs in the USA. Of course, the only jobs that a president can really “create” are government workforces and contractors. The stats above mostly reflect the difference in how each president’s term coincided with economic events. George HW Bush’s term ended with a job-destroying but relatively mild recession at the end of a long economic expansion. His son’s presidency ended with the global financial crisis. Trump’s ended with coronavirus.

It’s unlikely that alt-universe President Al Gore would have prevented the 2007 financial crisis, which had its roots in 1990s financial deregulation, and hammered even countries with good governments. (For example, the crisis exposed Iceland’s banking system to be a giant hedge fund.) And while Trump clearly butt-fumbled the public health response to COVID, it’s hard to say how alt-universe President Hillary Clinton would have managed it better from an economic standpoint. Except maybe that she wouldn’t have delayed the checks to get her name printed on them.

Either way, COVID was an economic shock where the entire global economy basically ground to a halt for a few months and then lurched on the brakes here and there for the next two years. The global supply chain was already full of shortages of goods and labor (supply!) when people got their checks and went back to work (demand!). More demand, less supply drove inflation, all over the planet. I really think that Biden’s approval rating would be 20 points higher if not for these uncontrollable downstream effects of the pandemic, but also he might not have been president at all without the chaos of COVID causing a lot of these problems.

In the US, consolidation of businesses that make and sell things is also driving inflation. Less competition, more monopolies. Biden and his activist FTC chair Lina Khan have actually been the first merger-skeptical administration in our lifetimes, and praise to them for this. Long-term, shooting down mergers is probably one of the strongest actions a president can take against inflation. (The Kroger-Albertsons merger would be bad, and their CEO is lying about prices.)

Back to those purportedly undecided Trump-leaners. They probably don’t understand why prices are higher than they used to be. Few people do.

And few people seem to understand that Trump’s three top policy priorities — (1) mass deportation of undocumented immigrants, (2) broad tariffs on imports, and (3) another monster tax cut — are all extremely inflationary. Trump doesn’t understand this either! Much of the post-COVID inflation was actually driven by labor shortages. (“Nobody wants to work anymore. Guess I have to raise prices so I can pay people a living wage.”) Now imagine what happens to businesses when a few million of the cheapest employees with no legal leverage disappear from the country.

Trump talks a lot about inflation, but he doesn’t propose to do anything except, uh, tell his cabinet to do something about it. (“On my first day back in the Oval Office, I will sign an executive order directing every cabinet secretary and agency head to use every tool and authority at their disposal to defeat inflation and to bring consumer prices rapidly down.” LOL, good luck with that.)

Tariffs are easier to understand — it’s a tax paid by an American company to import something from overseas. Given how much of what we buy is imported — from earbuds to bed frames to diapers — a blanket tariff would essentially be a regressive sales tax, baked into prices. Trump consistently speaks incorrectly about this, claiming that foreign countries pay tariffs to export stuff to the USA. It’s hard to know whether Trump is lying about this one, or if he doesn’t understand it, but his continual misrepresentation of tariffs certainly harm public understanding of them. I really hope Harris makes a point of this in the debate next week

Ultimately “the economy” — growth, employment, income, prices, visible evidence of prosperity — is a complex mosaic, but it’s also a vibe. Gas prices are down 1/3 from their peak two years. Can we even tell? Is “the economy” good if I can’t afford a house because prices are up 50% since the start of pandemic and a mortgage is above 6%?

If I were Donald Trump, I’d make “cheaper rent, groceries, and gas” my entire campaign. Now, a lot of people with actual access to Trump are telling him “stick to policy,” but he’s not listening to them. And most of his actual policies are deeply unpopular or just tactical non-sequitur (no taxes on tips, free IVF, Elon Musk will audit the government). The only way he wins marginal voters is if they believe that his business genius can make food and rent cheaper, even if he can’t articulate anything he’d do to make that happen. For low-info “economy” voters, that might be enough.

Either way, it’s clear that voting on “economy” is almost always irrational. It’s one of the lesser reasons why people on the American Right are longing for Caesar.

Also irrational: Americans’ general belief that “Republicans are better for the economy.” It’s all just vibes. As one expert recently said: “Every election for the last 200 years has been a vibes election.” Nobody is reading your campaign book, dude.

Rangelife Shorts

The best hour of television for a Gen Xer. If you’re watching TV tonight, somebody has uploaded entire episodes of Friday Night Videos to YouTube, including the ads! It’s almost hard to remember how important FNV was back in the day. In 1984 fewer than 30% of households could access MTV, but almost all of them received NBC. And so we watched videos, one at a time, with ad breaks and interviews with artists. Unlike MTV in the early ‘80s, Friday Night Videos also showed non-white artists who weren’t Michael Jackson. Anyway, why not enjoy an hour of old videos and ads tonight?

A great show about people who suck at their jobs. If you have another hour tonight, watch an episode of Slow Horses on Apple TV+. (Season 4 is pulling close to 100 on Rotten Tomatoes.) Slow Horses is a London-based domestic spy drama, but what’s really fun about it is that the agents are generally incompetent and fuck up all the time. Just like real life! Gary Oldman plays a legendary old spook who’s in charge of babysitting these idiots as they try to prevent mayhem from terrorists and within MI5. He’s hilarious and finally acting his last name.

The wildest music video I’ve seen in years. A$AP Rocky shot a music video in Ukraine like 60 days before the Russian invasion, but only released it this week, and that’s the 937th weirdest thing about it. This video demands your full attention and rewards it. Seriously, don’t look away. You won’t be able to, anyway.

Colorado School of Mimes. Never has a football team expressed so many silly emotions with their roster photos. I hope they win a championship this year.

Private equity is taking over youth sports. My son played competitive (travel) baseball for the first time this summer. And while he played on a city team that didn’t charge anything, I couldn’t help but notice that the other players were generally from affluent families. (Actually, I was delighted at how awesome the other SF baseball parents were, and I miss hanging out with them!) Youth sports are becoming more expensive, as are the services to give your kid a leg up. That’s why we just don’t see as many working class kids advancing to US pro sports anymore, and why financial predators are taking over the youth sports cash machine. Bloomberg (gift link): Private equity is coming for youth sports. Is there anything they can’t ruin?

Self-poisoning is booming. The replacement of traditional media with Internet nonsense is a regular topic here, and another recent example is the boom in raw milk sales. Pasteurization is good, people!

Peace out.

1. This was not an easy list to pull, and I don’t fully trust it. I first tried using the major AI research tools — ChatGPT, Gemini, Perplexity — to get this data, but it never looked right. So I kept asking clarifying questions like “Hey, why did you leave out Singapore?” and then they’d say “oops.” Or “which countries did you miss?” and then they’d include three more. These tools lie about what they know, and you shouldn’t rely on them.