Bidenomics Is Starting to Transform America. Why Has No One Noticed?

Among Joe Biden’s afflictions and miseries, his wormwood and gall, there are the insults (about his diminished capacities), and then there are the compliments unpaid (about his achievements). We are exposed to more of the first, but it seems that to him the second are more painful. In his first interview after he withdrew as the Democratic Presidential nominee, Biden—wounded, proud, self-pitying, defiant—said, by way of defending his record, “No one thought we could get done, including some of my own people, what we got done. One of the problems is, we knew all the things we did were going to take a little time to work their way through. So now people are realizing, ‘Oh, that highway. Oh, that . . .’ ” He trailed off for a moment and then recovered. “The biggest mistake we made, we didn’t put up signs saying ‘Joe Did It.’ ” He ended this with a bitter chuckle. Biden isn’t wrong. Objectively, and improbably, he has passed more new domestic programs than any Democratic President since Lyndon Johnson—maybe even since Franklin Roosevelt.

In the early weeks of 2021, very few people saw Biden as the obvious winner in the large field of potential candidates for the 2024 Democratic nomination. His victory over Donald Trump had not been overwhelming. The Democrats had lost seats in the House even while maintaining a narrow majority, and got to fifty votes in the Senate only after two runoff elections in Georgia broke their way. Then, with nothing close to a mandate, Biden passed domestic legislation that will generate government spending of at least five trillion dollars, spread across a wide range of purposes, in every corner of the country. He has also redirected many of the federal government’s regulatory agencies in ways that will profoundly affect American life. On Biden’s watch, the government has launched large programs to move the country to clean energy sources, to create from scratch or to bring onshore a number of industries, to strengthen organized labor, to build thousands of infrastructure projects, to embed racial-equity goals in many government programs, and to break up concentrations of economic power.

All of this doesn’t represent merely a hodgepodge of actions. There is as close to a unifying theory as one can find in a sweeping set of government policies. Almost all the discussion of “Bidenomics”—by focussing on short-term fluctuations of national metrics such as growth, the inflation rate, and unemployment, with the aim of determining the health of the economy—misses the point. Real Bidenomics upends a set of economic assumptions that have prevailed in both parties for most of the past half century. Biden is the first President in decades to treat government as the designer and ongoing referee of markets, rather than as the corrector of markets’ dislocations and excesses after the fact. He doesn’t speak of free trade and globalization as economic ideals. His approach to combatting climate change involves no carbon taxes or credits—another major departure, not just from his predecessors but also from the policies of many other countries. His Administration has been far more aggressive than previous ones in taking antitrust actions against big companies.

What would you call these policies? One apt label might be “post-neoliberal,” a term that does not resonate at all with the public. Another way of thinking about Biden’s approach is through terminology devised by the political scientist Jacob Hacker: it rejects redistribution as a guiding liberal principle, in favor of “predistribution,” an effort to transform the economy in a way that makes redistribution less necessary. Predistribution entails understanding the economy as something that structures the balance of power among institutions, rather than as a natural phenomenon that must be managed in order to lessen its harmful effects on individuals. So Bidenomics has overturned a number of unwritten rules that you previously had to follow if you wanted to be taken seriously as a policymaker: economic regulation is usually a bad idea; governments should balance their budgets, except during recessions and depressions; subsidizing specific industries never works; unions are a mixed blessing, because they don’t always promote economic efficiency; government should not try to help specific regions of the country or sectors of the economy.

At least in domestic affairs, nobody makes policy without thinking about politics. One grand ambition behind all the Biden economic initiatives is to usher in a political realignment that would make the Democrats competitive again in the more sparsely populated parts of the country, which have disproportionate political power. The idea is that Americans are not as motivated as you might think by notions of “opportunity” and “mobility”—that such liberal rhetoric has limited appeal among people who want to live safely and securely in the communities where they grew up, surrounded by strong institutions that are not subject to relentless economic and social disruption. (According to a recent Pew Research Center survey, ninety-two per cent of Americans say that financial stability is more important to them than upward mobility.) What people see happening around them matters far more than what the latest statistics tell us about the state of the economy. As Elizabeth Wilkins, who worked in the Biden White House, told me, “It’s national G.D.P. numbers versus how people feel about their lives, their families, their communities. It’s their job, the jobs of the people around them, what those jobs pay—not the aggregate numbers. We fully embraced that in our policy orientation.” And that meant shoring up specific places and institutions as a primary political strategy.

The irony of Bidenomics is the vast gulf between its scale—measured in money and in the number of projects that it has set in motion—and its political impact, which is essentially zero, even though a major part of its rationale is political. It has become a standard talking point of the engineers of Bidenomics that it will take at least five years, maybe ten, possibly even longer, for the public to understand its effects. “That’s the way it was with the New Deal,” Steve Ricchetti, one of Biden’s closest and longest-serving aides, said. “It wasn’t just three or four years of new programs. It was leveraged for twenty or thirty years into the future.” But the short-term politics worked out a lot better for Franklin Roosevelt; he carried all but two states in his first reëlection campaign. There is little evidence that the Democrats will be similarly rewarded in 2024. Only late in the race, when she was spending much of her time in the Midwest, did Kamala Harris begin speaking regularly about Biden’s major economic initiatives. It’s unclear how committed to them she will be if she becomes President. Trump has promised to repeal many of them. Still, President Biden can rest assured that many signs are being put up. They just don’t say “Joe Did It.” They say “Investing in America.”

Over the summer, I accompanied two Biden Cabinet members, Julie Su, the acting Secretary of Labor, and Pete Buttigieg, the Secretary of Transportation, as they travelled around the country promoting the Administration’s projects. These visits took place away from the coasts, mainly in small towns. Watching the Biden officials in action made me feel like a time traveller transported back to the social-realist days of the thirties and forties. At every stop, it seemed, we’d come upon a tall chain-link fence and drive through an open gate, past a guardhouse, and then down a long, lonely road leading to a factory. All around would be forklifts, cranes, pickup trucks, huge metal sheds, silos, and lengths of pipe so wide that you could stand up inside them.

On a Friday morning in July, I went to Fort Valley, Georgia, the seat of Peach County, to watch Su promote a new factory that will build electric school buses. If the over-all goals of Bidenomics sound abstract, this project makes for a good concrete example, because it unites all the major ideas. Fort Valley is a majority-Black town in a rural swing county, in a historically Republican state that the Democrats have targeted. The biggest business in town is the Blue Bird Corporation, one of the country’s largest manufacturers of school buses. During the next five years, nearly a billion dollars in grants will be awarded to dozens of school districts nationwide through the Environmental Protection Agency’s Clean School Bus Program, some of which will go toward the purchase of Blue Bird’s electric buses, and Blue Bird will receive eighty million dollars from the Department of Energy’s Office of Manufacturing and Energy Supply Chains. In essence, the Administration is generously funding a private business. Because the money will go to electric vehicles, the plan is part of both the transition to clean energy and the Administration’s project of bringing manufacturing back to the American heartland—rather than letting it happen, in particular, in China. And Blue Bird, for the first time in its ninety-seven-year history, has coöperated with its employees’ effort to unionize, a development that aligns with Biden’s support for unions.

For the event in Fort Valley, there was a temporary canopy to protect the audience from the summer sun, a few rows of folding chairs, a makeshift podium in front of a yellow school bus, and “Investing in America” signs posted at every possible location. The mayor, Jeffery Lundy, opened the event by saying that he was “excited and ecstatic” about the new plant. He thanked the federal government, the Blue Bird Corporation, and God, and ended by quoting a few lines of Scripture. Then came Yvonne Brooks, the president of the Georgia A.F.L.-C.I.O. Finally, Su, who has a brisk, cheerful charm, took the podium and said that the plant would help solve the climate crisis, create jobs for the local community, and give schoolchildren a chance to breathe cleaner air.

After the ceremony, Su and I found a room where we could talk for a few minutes. She is a lawyer who started her career in civil-rights organizations and then worked in state labor agencies in California. (Her liberal past has made it difficult for her to be confirmed by the Senate, and that is why she is the “acting” Secretary.) She told me about the amount of effort that had gone into making the Fort Valley announcement possible. Phil Horlock, Blue Bird’s C.E.O., had been brought to the White House for a meeting with Biden. Then, this spring, Su had come to Fort Valley to urge Horlock to speed up his slow-moving negotiations with the United Steelworkers. Was the conclusion of the negotiations connected to the eighty-million-dollar grant to build the electric-bus factory? “I’m going to answer this way,” Su said. “The way you asked me implies conditions. Whether workers want to join a union depends on them. Politicians should not interfere. It is not a condition. What I said to Phil was ‘There’s no reason not to have a contract after a year of negotiations.’ They got that done. The company took it seriously. Phil said, ‘We heard the Julie Su challenge, and we accept.’ ”

How did this new era in economic policy come to pass? How did Biden, the most familiar of politicians, and previously not seen as someone with sweeping policy ambitions, become the organizer of such a big program? In retrospect, it’s possible to see what happened as the convergence of a number of forces that have been building for fifteen years. It’s a story line that seems clearer now than it did as it was unfolding.

In 2008, Barack Obama swept into office with three hundred and sixty-five electoral votes and firm control of both the Senate and the House. It seemed as if the Democrats were on their way to securing a lasting majority, as they did in the New Deal era, this time with a coalition of educated urban and suburban voters and racial and ethnic minorities. The last stage of Obama’s campaign and the beginning of his Administration took place against the backdrop of the worst financial crisis in eight decades, but Obama seemed well equipped to handle it. He and a team of experienced economic advisers got Congress to pass a large stimulus bill, aimed at preventing another Great Depression. But we wound up having a Great Recession. The unemployment rate rose to a peak of ten per cent in October, 2009; it took until 2017 for employment to recover fully. The recession generated populist revolts on the right (the Tea Party movement) and the left (the Occupy movement), and made what had appeared to be broad public acceptance of pro-market bromides seem like an illusion. In the 2010 midterms, the Democrats lost six seats in the Senate and sixty-three seats, along with the majority, in the House.

Democrats concerned with economic inequality began identifying what they saw as the Party’s original sins. There was the Clinton Administration’s enthusiastic embrace of the North American Free Trade Agreement, and its lengthy negotiations to bring China into the World Trade Organization. Bill Clinton delivered a healthy economy as measured by the standard national statistics, but inside it were large pockets of woe, thanks to rising inequality and the departure of manufacturing jobs for Mexico, China, and other locations abroad. “We saw that this approach—get government out of the way, don’t give business a reason to invest here—led to inequality and massive dislocation,” Lael Brainard, the head of Biden’s National Economic Council, who also worked in the Clinton and Obama Administrations, told me. “You saw a downward spiral of investment.” Deregulation of the financial system made it less risk-proof and helped to set the stage for the 2008 crisis. Some argue that, if Obama’s stimulus package—initially estimated at seven hundred and eighty-seven billion dollars—had been bigger, the Great Recession, and the resulting level of political discontent, would have been less severe.

Obama was reëlected easily, in 2012, but the Democrats’ bill came due in 2016. During the primary season, Bernie Sanders, a politician whom the Democratic establishment didn’t take seriously, performed unexpectedly well by running to the left of Hillary Clinton on economic issues. In the November election, Trump—another outsider, running as a right-wing populist—peeled off enough formerly Democratic voters, especially white working-class men, to win. It wasn’t just that the Republicans flipped contested states such as Wisconsin and Pennsylvania; formerly competitive states, among them Florida, Iowa, and Ohio, now seemed to be moving permanently out of the Democrats’ reach. Hacker describes the mood around that time this way: “Trump gets elected. You can’t understate this. People woke up. Nothing concentrates the mind as much as the prospect of losing your democracy. We lost the heartland.”

After a defeat, parties often rethink their strategies. The 2016 election was such an extreme shock to the Democrats that the rethinking had a special urgency. “Sanders and Trump tapped into something,” Elizabeth Wilkins noted. “We had to speak to economic populism as we hadn’t before.” People who had expected to be working in a Hillary Clinton Administration “spent a lot of time coming up with policy proposals because after 2016 they had nothing to do.” There was an explicit focus on finding ways to address people’s problems in their own communities—particularly in the places where the political tide had turned against Democrats. As Hacker put it, “A lot of America had been devastated by trade and by inequality. You lose civic capital in places. It’s one thing to compensate the losers. But, if you don’t, it’s a total fucking disaster.”

In high-level policy circles, a number of Democrats took up efforts to reconnect with the working class and distanced themselves from past economic policies. Jake Sullivan, now Biden’s national-security adviser, conducted a public self-examination after the 2016 election; he wrote an article in which he argued, “The American electorate as a whole is moving to embrace a more energized form of government—one that tackles the excesses of the free market and takes on big, serious challenges through big, serious legislation.” Even before 2016, John Podesta, another Clinton-Obama veteran now back in the White House, had co-founded a think tank called the Washington Center for Equitable Growth.

The argument that the Democratic Party can win by moving to the center is a staple of op-ed pages, and it seems to be shaping the Harris campaign. But inside the political world the economic left had earned significant clout by proving that it could produce new policy ideas and win votes. In 2020, Sanders ran another spirited Presidential campaign, and his reward for dropping out of the race and endorsing Biden was the creation of two Unity Task Forces, one populated with some of his supporters and the other with some of Biden’s. Senator Elizabeth Warren’s Presidential campaign had ended earlier, but the broad array of policy proposals that she put forth, generated by a network of young lawyers she had cultivated over the years, gave her a great deal of influence, too. The Unity Task Forces jointly released a hundred-and-ten-page set of potential policies in July, 2020. Biden didn’t wind up trying to enact everything in this document, but just about everything he has proposed is in there somewhere.

Also in July, 2020, Biden made a few economic-policy speeches that clearly signalled his retreat from neoliberalism—one on reviving American manufacturing, one on climate and infrastructure, one on racial economic equity, and one on the “care economy.” There was, at the time, a sense of forces within the Democratic Party and external events converging to yield a new political consensus. The COVID pandemic, and the high level of alarm about Trump throughout the Party, meant that the Biden Administration was coming to power during a dire national emergency. No prominent Democrats were arguing that it was a time for the government to exercise restraint. As one member of a rising generation of activists, who ended up working in the Biden White House, put it, “It’s not clear that there’s a neoliberalism to go back to.”

One feature of this post-neoliberal period is that super-ambitious, impeccably credentialled Administration officials now feel the need to demonstrate that they have not become clueless creatures of the coastal élite. Jake Sullivan’s wife, Maggie Goodlander, another former White House official, is currently running for Congress to represent a district in northern New Hampshire, and if she wins he would presumably join her there. Buttigieg has moved to Traverse City, Michigan, the home town of his husband, Chasten Glezman Buttigieg.

Over the summer, I visited Brian Deese, another high-ranking official in the Obama and Biden Administrations, in his new home town, Portland, Maine. During the Obama era, Deese, a onetime aide of Larry Summers, was seen as a neoliberal; during the Trump years, he worked for BlackRock. Biden appointed Deese, then in his early forties, as the director of the National Economic Council, a business-facing unit of the White House which Bill Clinton created. I met Deese—a slight, bearded, blue-eyed man who has the informal manner and the intensity of a Silicon Valley executive—at a new graduate school created to promote the development of tech companies in Maine. He gave me his version of the origins of Bidenomics: “Two things were going on in the spring of 2020: Biden secured the nomination, and COVID. He did something that’s unusual in politics. He shifted his policy vision to be more expansive. Usually, it’s the other way around.”

The result was the American Rescue Plan, a $1.8 trillion bill—more than double the size of Obama’s stimulus legislation. It came only a year after Trump had signed a bill of equivalent size, in the early days of the pandemic, that was also meant to prevent a recession or a depression. And, indeed, the COVID recession was far shorter and less severe than the recession that followed the financial crisis. There were many items in the bill that signalled Biden’s priorities beyond just getting through the worst of COVID. Nearly ninety billion dollars went toward increasing the child tax credit, eighty billion went to shoring up union pension funds, eighty-eight billion went to infrastructure projects, and three hundred and fifty billion went to state and local governments.

The rap on the rescue bill is that it set off several years of inflation—now finally under control—which made Biden’s management of the economy widely unpopular. Jason Furman, who was Obama’s last chair of the Council of Economic Advisers and now teaches at Harvard, has been a persistent public critic of the bill, especially for its provisions authorizing more than four hundred billion dollars in checks to be sent to families with annual incomes of less than seventy-five thousand dollars. “Nobody could defend it as the right policy,” Furman told me. “The idea of sending people two-thousand-dollar checks was invented by Trump.” (Economists prefer tax credits.) “Nancy Pelosi and Biden adopted them to troll the Republicans and to win the Senate races in Georgia. People already had money in the bank because they couldn’t buy anything,” with stores closed and supplies short, on account of the pandemic. So the price of everything rose.

By that time, it was clear that more traditional economic voices like Furman’s would not be dominant in Biden’s White House. On economic policy, most of the people who served under Clinton and Obama had been, as Furman put it, “Robert Rubin”—a former head of Goldman Sachs and the first director of the National Economic Council—“and his children and grandchildren,” figuratively speaking. (He’s one of the grandchildren.) But the ferment of the years after the financial crisis had produced a new talent pool, associated especially with Elizabeth Warren. Former aides and allies of Warren’s, and former staff members at think tanks like the Economic Policy Institute, wound up on the Council of Economic Advisers, working for Deese at the National Economic Council, or at many of the federal regulatory agencies. Jobs that customarily had gone to economists, who are predisposed to trust in markets, went instead to lawyers (like Deese), who are trained to focus on rules and institutions.

I asked Deese whether he considers himself a repentant former neoliberal. He wasn’t willing to agree to that, but he did say that some of the ideas he was charged with implementing in the Biden Administration would not have been given serious consideration under Obama. “If you had said to me in 2010 that I would be supervising industrial strategy, I would have said, ‘That’s crazy. Nobody would listen,’ ” Deese told me. “If you wanted to say ‘industrial strategy,’ you couldn’t. It was ‘picking winners.’ ”

Deese said that his perspective changed when he was in the Obama White House, working to keep General Motors and Chrysler in business during the financial crisis. “That made me see the potential for government to shape the economy,” he said. “I gained a deeper and more ground-level sense of what it meant to have economic capacity and why it’s essential. Those ideas were made super real for me by seeing an industry in free fall. We have intervened time and again in the auto industry, including in the Reagan Administration. Saying we don’t do that is a wrong description of what we’ve done as a country.”

The Biden Administration passed three more colossal bills in 2021 and 2022: the Infrastructure Investment and Jobs Act ($1.2 trillion), the CHIPS and Science Act ($280 billion), and the Inflation Reduction Act (originally estimated at $380 billion, now thought to have an actual cost of more than $800 billion). Together, these laws have hundreds of provisions. But, broadly speaking, the first is intended to fund bridges, roads, harbors, and other building projects; the second brings semiconductor production back to the United States; and the third finances the transition to non-carbon-producing energy sources. In our conversation, Deese argued that the three initiatives should be thought of as one big legislative package. They share the same goal: to rebuild and redirect the industrial capacity of the United States. “We don’t just want the economy to grow,” Heather Boushey, a member of the Council of Economic Advisers, said. “Growing from the middle out means that what we make and how we make it matters.”

That idea animates many other things the Biden Administration has done (and one thing it hasn’t done: negotiate any new trade agreements). In addition to passing legislation, the White House has issued a number of significant executive orders. Probably the most important came in July, 2021—an order on competition which stands as the strongest Presidential statement on monopoly and antitrust in American history. Biden also filled the country’s regulatory agencies with appointees from the economic left of the Party. The best known of these is Lina Khan, of the Federal Trade Commission, but similar appointees are running the Justice Department’s antitrust division, the Securities and Exchange Commission, the National Labor Relations Board, and all the environmental agencies. The Obama Administration opened an antitrust investigation of Google and then dropped it. The Biden Administration sued Google and won. Obama, after recruiting Elizabeth Warren to design the Consumer Financial Protection Bureau, rejected her request to be nominated as its initial director. Biden appointed to the position Rohit Chopra, one of Warren’s aides from those days.

Then there are parts of the government that are practically unknown to the outside world—Biden remade many of those, too. One example is the Office of Information and Regulatory Affairs, which Clinton established in the first year of his Presidency, to reduce the number of federal regulations. Obama’s head of the O.I.R.A. was Cass Sunstein, a law professor and the co-author, with the behavioral economist Richard Thaler, of the book “Nudge.” That selection was a gesture in the direction of light-touch regulation. Biden reversed course by putting K. Sabeel Rahman, a Warren ally, in the job, and approving a new way for the government to calculate the cost-benefit ratio of initiatives, giving more weight to social benefits. Such considerations are embedded in the Biden legislation. The CHIPS Act allowed the government to mandate company-paid child care for the workers in the new factories it’s financing, and for the construction workers building them, too. Forty per cent of federally backed climate investments are required to be made in disadvantaged communities. “We were trying to fuse the realities of race and other structural inequities with economics,” Rahman told me. “Some people say, ‘Just talk about the economics of it.’ But we were trying to put these economic programs together in a way that would actually address structural inequalities.”

Biden’s most dramatic departure from past Democratic policy might be on climate change. For decades, incentive systems have been the dominant idea for reducing carbon emissions. Leah Stokes, a professor at the University of California, Santa Barbara, who’s also a prominent climate activist, said, “It’s wildly unpopular to make fossil fuels more expensive. You put up the cost of everything.” The Obama Administration’s major climate initiative was based on cap-and-trade, which allows companies to buy and sell emission allowances. The proposal never came to a vote in the Senate, and Biden wound up abandoning these ideas entirely. John Podesta, who’s now responsible for climate policy in the White House, said that any Biden proposal “had to be politically viable, and to show a path forward for American workers. So we flipped the politics of it—shifted from ‘What do we need to shut down?’ to ‘What do we need to build?’ ”

The way this played out was determined in the summer of 2022. The American Rescue Plan had passed quickly, though with no Republican votes, and the infrastructure bill had followed, but another four trillion dollars in Biden proposals remained. Most of it was divided into two parts, called the American Jobs Plan and the American Families Plan. The Democratic House passed a bill combining the two, called Build Back Better, but it died in the Senate. The senator with the key vote, Joe Manchin, of West Virginia, made it clear that he opposed the American Families Plan—which included child care, paid family leave, and free community college—because he considered it to be a series of handouts. But he opened negotiations on the American Jobs Plan, which was devoted mainly to business-friendly, globalization-skeptical clean-energy provisions. It was eventually renamed (actually, misnamed) the Inflation Reduction Act and passed that August. “It came together, and we were able to get it over the finish line,” Deese said.

The Inflation Reduction Act heavily bears Manchin’s stamp. At its core are generous tax credits to businesses, mostly but not entirely in clean energy, and West Virginia will do very well. Once you get past understanding it simply as a landmark piece of climate legislation, the act is a large, unkempt thing. With the exception of a couple of relatively minor provisions, it penalizes no one for anything. Some of its provisions will benefit fossil-fuel companies. More than eighty per cent of its projects are being built in Republican districts—partly because they have more empty land and looser regulatory environments. (Conversely, around the country, feuds have broken out between environmentalists who want to push the clean-energy revolution forward and environmentalists who are opposed to, say, establishing mines to extract the minerals used in electric-vehicle batteries.) The projects have been rolling out slowly. One reason that the law will cost so much more than was estimated when it passed is that some of its subsidies come in the form of uncapped tax credits—anybody below a fairly generous income ceiling who wants a seventy-five-hundred-dollar tax credit for buying an electric vehicle can have one, and the credits can’t be applied to cheaper Chinese E.V.s, because of the Administration’s ethic of “build American, buy American.” European allies are upset because the Inflation Reduction Act’s tax credits are so generous that they are enticing businesses in their own countries to build new factories in the United States.

The White House says that, by the end of this decade, the bill will reduce carbon emissions from 2005 levels by forty per cent, and that it has created three hundred thousand new jobs across more than three hundred projects. Deese told me that more than five per cent of all new investments in the United States are now being made in clean energy, up from about one per cent in 2018, because of how powerfully the Inflation Reduction Act’s tax incentives change the economic calculus for private companies.

Back in the New Deal days, the Democrats were straightforwardly the party of labor, and the Republicans were the party of business. That simple division became much more complicated in the nineties. The Biden Administration showed its loyalties by doing a lot for at least some businesses, and for labor, and for all its other major constituencies and hoped-for constituencies. Whether that approach is sustainable, especially with Biden gone, is another question.

Kamala Harris hasn’t spent a lot of time on the campaign trail visiting Biden Administration-funded infrastructure projects. That duty falls primarily to her former rival in the 2020 Presidential campaign, Pete Buttigieg. He is the public face of the infrastructure bill, which got sixty-nine votes in the 50–50 Senate, partly because it’s hard for politicians to oppose noncontroversial building projects in their districts. (By contrast, no Republicans voted for the Inflation Reduction Act.) Buttigieg has held public events at infrastructure sites in all fifty states. I spent the better part of a week touring the Midwest with him, visiting Administration-funded projects.

In Menominee, Michigan, we went to a small, privately owned port on Lake Michigan that often ships large wind turbines. It got a twenty-one-million-dollar grant, its first ever from the federal government, to deepen and upgrade its shipping channel. In Manitowoc, Wisconsin, a local malt company is applying for an infrastructure grant that would help it ship products from the city’s small port. In Milwaukee, the port got nine million dollars in federal funds to help Wisconsin farmers send their crops through waterways to markets around the world. In Kokomo, Indiana, an auto manufacturer showed off facilities for its transition to producing electric vehicles, one of which has been awarded a two-hundred-and-fifty-million-dollar grant from the Department of Energy. In each of these cases, the project bundled multiple Biden goals: clean energy plus working with business plus unionization plus rebuilding the Midwest’s industrial base.

Buttigieg—crewcut, trim (he’s a triathlete), dressed in a dark-blue suit, a white shirt, and a tie—is very good at being the Midwestern boy who left and then decided to come home. He’s polite, punctual, respectful, and fully briefed, scrubbed of all traces of the attitudes that Midwesterners find suspect in people from the coasts. At each stop, he found a way to mention his local roots and his military service in Afghanistan—but not the Republican-zinging appearances that he’s been making on Fox News. On the south side of Milwaukee, Buttigieg met a group of farmers at a restaurant—mainly beefy guys with beards who, while they were waiting for him, chatted about the upcoming state fair. Buttigieg walked in at 7:45 A.M. and shook hands. “Thanks for stayin’ up late to see me,” he said. (Farmers wake up well before dawn.) Then he sat down at a long table and spent an hour hearing from everybody. In the background, on a wall-mounted television with the sound turned off, an ad came on for Tammy Baldwin, Wisconsin’s more-popular-than-you’d-expect Democratic senator, pointing to her role in instituting price caps for inhalers. Buttigieg and the farmers talked about five-axle versus six-axle trucks, the economic potential of processed soy meal, and Port Milwaukee’s ability to handle non-containerized cargo. A couple of times, Buttigieg tried gently to steer the conversation toward the larger themes of the Biden Administration, specifically climate change and antitrust efforts. The farmers were polite, but these issues obviously didn’t resonate with them at the same level as immediate, practical matters. After the breakfast, Buttigieg went to the port for a public event, where, in front of a pair of enormous corrugated-metal silos and an “Investing in America” sign, flanked by local dignitaries, he told a small audience about the eight hundred thousand manufacturing jobs that the Administration had created.

Afterward, Buttigieg and I met in an empty conference room in the port’s office building, and I asked how he explains the long-running industrial decline that the Administration is working to reverse. “I think in most accounts the familiar culprits are globalization and automation,” he said. “I would put it a little differently, though. More than anything, it was an unwillingness to invest in the kind of industrial policy and the kind of infrastructure development that made our original industrial economy possible.” Brian Deese had made a similar point: industrial strategy is a venerable American tradition, going back to the days of the Erie Canal, one that was forgotten for a few decades, with terrible effects, and is now being revived. As Buttigieg said, Biden’s economic policies recover “some of the things we were wrong to walk away from, like industrial policy, support for labor unions, support for big investments in shared things like infrastructure.”

I asked Buttigieg whether he could offer a single rubric that would encompass all the Administration’s economic policies. He said that he’d been thinking about this. “What I landed on,” he said, “was the idea that we’ll one day come to remember this as the Big Deal. There’s the New Deal. There’s the Square Deal”—Teddy Roosevelt’s name for his domestic programs. “Now we’ve got the Big Deal, because in some ways its bigness is the defining factor.” In infrastructure-building, at least, “the prior examples were more one mode at a time. The interstate highway system was massive, but that was confined to highways. The transcontinental railroad was massive, but that was about one mode: railroads. The Big Deal is more multimodal.”

That brings us back to the question of why the world hasn’t thought to call the Administration’s programs the Big Deal, or even to consider them a big deal. In Kokomo, I had another conversation with Buttigieg, in an empty classroom at a community college that trains people to work in electric-vehicle production, and I asked him about this. He gave the standard argument of Administration officials who are leading the implementation of the new economic programs: it will take a while for their political effects to arrive.

“Two things I think are going to happen in terms of political impact,” Buttigieg said. “They’re totally separate and apart from ‘Oh, you did the bridge, we’re going to support you now.’ I don’t just mean project-level political impact. The two things I would point to are more subtle, but I think very powerful. One of them is public trust. If you look—as we often do as Americans on the left and center left—to the Nordic countries, one of the things you find there is a high level of confidence that the system is fair, partly because they use tax revenue to deliver services that people appreciate. And so you have a higher level of social and political trust, because things are delivered. There’s a virtuous cycle where, if people see something for their tax dollars, they’re more likely to be confident that they can and should support public things with their tax dollars.”

He went on, “The other is when you reduce inequality, and especially when you reduce inequality across social lines, like racial wealth gaps, that is conducive to a better political environment for everybody. Tony Judt, in ‘Ill Fares the Land,’ put forward some data showing that, even on the same average income, the society with more inequality will have worse public-health outcomes, more violence, you name it. So, for example, the data we’ve seen on the reduction in the racial wealth gap between 2019 and 2022 is really important. I’m not saying that a voter consciously gives the elected official who engineered that credit twenty years down the line, but I do think it just creates a better environment for all of our political processes to play out.”

If you squint, you can see the outlines of a new post-neoliberal Democratic coalition. Fast-growing clean-energy industries—wind, solar, batteries, hydrogen, electric vehicles—could join Hollywood and Silicon Valley in supporting the Democratic Party. Purple-tinted states, such as Georgia and Arizona, which are getting lots of clean-energy projects (Georgia is in the “battery belt,” Arizona in the “hydrogen belt”), could turn bluer. (The Biden Administration even has plans to spend hundreds of millions of dollars reviving the steel industry in J. D. Vance’s home town of Middletown, Ohio.) The Administration’s insistence on union labor in its building projects could begin to reverse the long decline of private-sector unionization. (The national rate is currently six per cent, down from about a third in the fifties.) A more successful push for the policies that were part of the American Families Plan could bolster not just family incomes but also the care industry and its employees’ unions. All these policies would help Black and Latino families, and so might shore up their wobbling loyalty to the Democratic Party.

Here’s a specific example of the way Democrats are hoping things work out politically. On January 23, 2017, the first full workday of the Trump Administration, Sean McGarvey, the president of North America’s Building Trades Unions—a muscular, heavily male zone of the labor movement which the Republican Party has been wooing intermittently for decades—stood in front of the White House, at the head of a platoon of union leaders and members in the construction industry, and made a brief, exuberant public statement: “We just had probably the most incredible meeting of our careers with the President, and the Vice-President, and the senior staff. . . . The respect that the President of the United States showed us—and when he shows it to us he shows it to three million of our members across the United States—was nothing short of incredible.” Five years later, McGarvey took the podium at a convention of the building-trades unions and offered up half an hour of ardent love for the Biden Administration. I asked McGarvey what happened. Trump, McGarvey said, “never did anything he said he was going to do. He never did infrastructure. His National Labor Relations Board was laden with anti-labor ideologues. He never did pensions. Pretty much you name it. That first meeting was all the things he was going to do. And then we had four years of a knife fight in a phone booth.” The Biden Administration, by contrast, had “delivered every possible thing we could ever possibly ask for or imagine. There have been things they did for us that we wouldn’t have had the chutzpah to ask for.” Partly because of the Administration’s projects, the building-trades unions have added fifty thousand new members in the past year—their most significant growth since the fifties.

In the view of the designers of Bidenomics, this kind of shift would be just the beginning, because, once you put into place the idea of the government remaking the economy, policy and politics will begin to operate together in a continuous self-reinforcing loop. But that’s far closer to being a hope than a certainty.

Where we are now, near the conclusion of the 2024 campaign, is profoundly strange. People love to complain that politics organizes itself around perception, not reality. Here’s the reality: one party, the G.O.P., ditched its establishment, embraced a form of economic nationalism and populism, and surprised everybody by winning a Presidential election. This wasn’t just a freak event; versions of the same thing happened around the world. In the United States, the Trump Administration, once it was in power, mostly pursued not what it ran on but an old-fashioned Republican program of tax cuts and deregulation. Meanwhile, the Democrats began competing for the voters Trump had attracted, and, after this helped lead to a victory in 2020, they enacted an ambitious program aimed at the economic lives of working- and middle-class Americans. And still, outside a limited cadre of activists and policymakers, none of this is the dominant narrative of American politics. Another complaint that people make about politicians is that they are all talk, no action. With Biden, on these issues, it has been almost the opposite: lots of action, very little talk. As Harris’s campaign wore on, she began speaking more about economic issues, especially during her visits to Midwestern states, but her language has been quite different from that of other Biden officials. If Biden’s actual economic policies were the main topic of the campaign, perhaps the outcome of the election would determine their future. Their absence from the election makes their fate more of a mystery.

If Harris wins, will she stay the course that Biden has set? Biden hasn’t been articulate enough lately to lay out his economic vision, and Harris’s instinct is to present all her ideas, including economic proposals, in specific, tangible, personal terms. Rohini Kosoglu, a former policy director for Harris, told me, “Sometimes she tells people who work for her to imagine going to someone’s wedding and then being invited to their house and seeing the wedding album on a table. If you open it, what are you going to be looking for? A picture of yourself at the wedding. The American people want to know that we see them when we think through our policy.” Harris’s earliest economic proposal, a ban on price gouging in supermarkets, meets the wedding-album test—you can see yourself in the policy—but nobody thinks of it as a major economic reimagining. Her economic background and Biden’s bear little resemblance. He comes from a downwardly mobile family who had to relocate to the declining blue-collar city of Scranton, Pennsylvania, and who lost everything after the Second World War. Her parents were upwardly mobile immigrants, and her home ground is the booming, innovation-celebrating Bay Area. People who work with Biden say that he has an instinctive mistrust of economists, especially those from élite universities. Harris is the daughter of successful academics; her father is an economist who worked for years at an élite university.

Harris’s career has not centered on economic issues, as Sanders’s and Warren’s have, and she has strong ties to Silicon Valley, which is skeptical of Biden’s economic policies, especially on antitrust, trade, and unions. (Her brother-in-law Tony West is a senior executive at Uber, now on leave to work on the campaign.) Economically oriented Democratic policymakers have been obsessively parsing her every move for clues about how post-neoliberal she will or won’t be. Having become the nominee much later than Biden did in 2020, she hasn’t had time to set a full policy agenda or to create a cadre of future officials for her Administration. Gene Sperling has left the White House and joined her campaign full time—but Karen Dunn, the lead lawyer for Google in one of the Administration’s lawsuits against the company, was on the small team that prepared her for her debate with Trump. Harris frequently says that she wants to create an “opportunity economy,” which isn’t language that post-neoliberals would use—they’d prefer “shared prosperity.” She has ratcheted down a Biden proposal on capital gains and corporate taxes, to lower the rates, and she has been notably silent on the activities of regulatory agencies, such as the S.E.C. and the F.T.C., that are intensely unpopular with business. Warren, in an interview on a Boston radio station back in January, declined to say whether she thought Biden should renominate Harris as his running mate; it seems unlikely that Harris would use Warren as an informal personnel director the way that Biden has. On the other hand, Harris is obviously enthusiastic about care-oriented policies like the child tax credit and paid family medical leave. She gives no hint of being a limited-government person on principle.

Harris rarely talks about antitrust, or industrial policy, or trade, or the larger idea that the government should actively structure the market economy. Because these are rather technical issues, she can promise to help the middle class without being very specific. In the debate, she was vague about her economic plans, but she took pains to mention that Goldman Sachs, the Wharton School, and many prominent economists prefer her plans to Trump’s. That wasn’t a very Bidenesque message. In Harris’s first major economic address as the Democratic nominee, in North Carolina in August, she attacked Trump for levying tariffs that would “in effect” raise taxes on the middle class. This seemed to imply that she accepts the standard view of economists that tariffs are taxes and are a bad idea. But Biden has imposed heavy tariffs on, for example, Chinese electric vehicles. (As Buttigieg put it in one of our conversations, “There is a legitimate national interest in insuring that these programs create American jobs, even if that interest is not free of charge.”) Will Harris keep these tariffs? Will she retain Lina Khan, the bête noire of the Democratic donor class, at the F.T.C.? Did Harris’s one anodyne line about unions in her first speech—“you should be able to join a union if you choose”—signal a loosening of Biden’s intimate embrace of organized labor?

If Trump wins, will he dismantle Bidenomics? Maybe not, or not entirely. Trillions of dollars’ worth of tax cuts that Trump passed during his Presidential term will expire at the end of next year. If Trump gets another term, he will likely try to extend them, and that will constrict what the government can do. But Biden’s major legislation is designed to be difficult to repeal. The money is legally committed, and there are quiet efforts under way to speed up the slow pace of project launches, and to make project cancellations legally difficult, in order to Trump-proof the Biden program. Because so much of the spending is going toward the kinds of projects that elected officials love, and is in Republican-held political territory, and is aimed at the voters Trump claims to represent, it’s meant to be difficult for Republicans to abandon.

Also, underneath the bluster, threats, and theatrics, Trump is running on an economic program that would have been unimaginable coming from any previous Republican nominee, including him. He is now officially devoted to preserving Obamacare, which he spent his previous term trying to overturn. He has promised not to cut Medicare, to increase Social Security by making its benefits tax-free, and to eliminate taxes on tips and overtime pay. He wants to impose new tariffs that would be much larger than the ones he put in place when he was President. J. D. Vance has proposed more than doubling the child tax credit, to five thousand dollars, a move that would cost trillions. The most vulnerable of the major Biden bills is the Inflation Reduction Act, but Trump has stopped short of promising to repeal it. Its largest provision is a subsidy for domestically produced electric vehicles, and one of Trump’s richest and most vocal supporters is the leading manufacturer of them, Elon Musk. Consistency has never been Trump’s hallmark.

A great deal depends not just on who is elected President but on whom that person puts in key economic positions, and on the results of the House and Senate elections. A divided Congress and a sense that the country isn’t immediately in crisis would not make for favorable weather for major changes. Still, American politics feels very different from the way it did at the turn of the millennium—we have been through the political version of climate change. In his 1996 State of the Union Address, Clinton declared, “The era of big government is over.” Inside the daily chaos of politics, there seems to be a new invisible foundation: the era of the era of big government being over is over. Both parties have accepted the premise that the government has failed voters without a college degree, especially in the middle of the country, and both are actively wooing them—partly because they determine the balance of power in American politics. (That’s why Trump and Harris chose the running mates they did.) Both accept that the wrong to these voters was done through excessive faith in unfettered markets. That faith isn’t miraculously going to reappear as the controlling principle of American politics anytime soon, but that hardly leaves matters settled. The parties have radically different ideas—different in substance, different in values, different in methods, maybe also different in sincerity—about how to achieve what they present as the same goal. The question that will dominate the years to come is whose version of the new, enlarged role of government will prevail. ♦