Joe Biden’s battles have just begun


Most Democrats I know are positively stunned by Joe Biden’s presidency. This man is like a political Yoda, harnessing the strength of the government to bypass the worst economic crisis since the depression in 100 days. His Employment plan, Covid crisis management and move to shift the country to a system that rewards not working for wealth involve changes that many have been hoping to see for decades. The program includes higher labor standards and a fairer tax system, investments in health, child care and education, and more resilient supply chains. Even Republicans are okay with things like better roads and broadband.

Some of what Biden offers, such as use union work in federal contracts and defend US business interests, can be done with the stroke of a White House pen. But multibillion-dollar stimulus packages will have to go through Congress. It depends on whether the House has a slim majority of Democrats (the Senate is split 50 to 50). Even if the plans pass, the implementation will be complex.

The practical details of many programs – how they would be implemented, which agencies (state or federal) would be responsible, and how they would be funded – are still scarce. But as more concrete plans emerge, they are likely to involve trade-offs between a myriad of interest groups. This is where the hard work really begins.

First, there are the usual considerations to be made between politics and politics, which are particularly important ahead of the midterm elections, where Democrats risk losing their margin of support in the House.

Polls show that Republicans and Democrats want infrastructure investments in new bridges and broadband. The question is, where does the money flow first? A large percentage of building trade unionists voted for Donald Trump in the last election. These voters, many of whom are in vibrant states, want early spending on off-the-shelf projects that will quickly put large numbers of workers to work, which the president has acknowledged. in his speech last week to Congress, calling its work plan a “blue collar plan” to “rebuild better”.

The reconstruction of bridges and roads is certainly necessary and offers opportunities to cut the ribbon. But strengthen broadband in underserved communities, some of which are rural but many of which are in large urban areas, is arguably even more important. However, these efforts are less visible. The initial investment would go to equipment rather than people, and the process of laying cable and fiber is slow. The same goes for things like boosting the semiconductor supply. Building a foundry takes years, not months.

This highlights the tension between short-term and long-term priorities. The US financial markets and in particular the venture capitalists want quick results and big exits. But rebuilding the industrial base and transitioning to a green economy is a decades-long proposition. This may require an entirely new long-term financing system, such as a public infrastructure bank, not to mention a commitment to industrial policy.

It will also require the support of the allies. Bridging the gap between what will sell at home and what will sell overseas can be the president’s biggest challenge. In his speech to Congress, Biden said he has had conversations with world leaders who think the United States is “back” but want to know “for how long?” Europeans naturally want to be able to count on American political stability before engaging in liberal democratic alliances around trade, taxation and technology, in particular given the importance of China-EU trade links.

Europe and America need each other and should work together to develop a digital alliance that a liberal-democratic alternative Beijing-style state-based surveillance capitalism, or the unfettered Big Tech monopolies represented by Silicon Valley groups. But even as Europe realizes that its long-term interests are best protected by strengthening its ties with Washington rather than Beijing, Europeans and Americans have different companies pushing for priority and protection.

Witness, for example, Apple and Google are fighting Bayer, Siemens and BASF over patent rules and who gets what share of the value of the 21st century digital economy. Or European concerns about data regulation in the United States. Germany will be the starting point for how this all plays out, as the US pushes the country to choose between various 5G and chip-based systems. In this battle, German exporters, which sell to both the United States and China, have a lot to lose. As a lawyer representing powerful American trade union interests recently told me, “Germany is trying to have it both ways with China, and they can’t.”

Neither can Biden be both a pro-Labor president and a president who seems to be going slow with Big Tech. Silicon Valley is a huge lobbying presence in Washington, with politicians from both bands in its pocket. the Uberization more types of work, the the failure of union activists to organize in tech companies like Amazon, and the argument that platform monopolies shouldn’t be broken because they have to stay big to defend America’s national economic interests all threaten Biden’s view of “work, not wealth.” This political battle for Yoda is only just beginning.

rana.foroohar@ft.com

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