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President Joe Biden speaks to members of the media about reducing energy prices © Bloomberg You
might have thought America’s voters would appreciate having Joe Biden
in charge at this time of geopolitical crisis. I certainly am. The case
against Donald Trump need hardly needs restating. A man who went from
nuclear brinkmanship with North Korea to schoolboy infatuation with Kim
Jong Un in the space of a few weeks lacks the temperament to handle a bona fide
threat to global stability. That is without mentioning his crush on
Vladimir Putin. But I would also make the distinction with Barack Obama,
who, for all his cerebral qualities, lacked both the patience and
conviction that Biden has been showing these past few weeks. To be sure,
Biden makes regular gaffes, or Bidenisms as we call them in DC. But we
knew this about Biden anyway and largely discounted them. Most people,
including Putin, can appreciate the difference between Biden
extemporising his moral outrage against Russia’s leader and the reality
of official Nato policy. They are not the same thing. So
why does Biden keep falling in the polls? It was easy to understand
that drop in his numbers prior to February 24, but I confess to being
surprised they have kept falling since then. This is in spite of the
fact that most voters actually approve of how Biden is handling the
Ukraine crisis. It follows that they don’t rank Ukraine as a
particularly pressing issue: it’s not in the list of top three of voter
concerns. Maybe they know something I don’t, but I really think it
should be. Unfortunately, the world is not a fair place. Russia’s
invasion of Ukraine is exacerbating most of the problems that were
damaging Biden in the preceding months. Chief
of these are rampant inflation and falling US growth prospects. As the
effects of last year’s stimulus recede, voters will feel the pinch even
more. There is not a lot that Biden can do about this. Yesterday he
announced that he would release 1mn barrels of oil a day
for the next six months from America’s strategic reserve. Alas this
will not be nearly enough to counter the impact Russia’s invasion has
had on inflation. Nor will Biden’s periodic statements about market
concentration make any appreciable difference. There
is little doubt that many sectors in the US economy are borderline
oligopolistic. But trustbusting takes years and will have no effect on
today’s prices. The knock-on effects of the war in Ukraine are also
being exacerbated by China’s periodic Covid shutdowns — most recently in
the key port of Shanghai — that worsen the global supply chain problem
that is behind much of the inflation. The other driver, excess US
demand, is something that can only be addressed by the Federal Reserve.
As Lawrence Summers points out in this fascinating exchange
with Ezra Klein, in the past few months real US interest rates have
fallen further into negative territory. So the Fed will have to apply
the brakes more sharply, which will dampen growth and may even lead to
recession. All
of which offer bleak auguries for Democratic midterm election
prospects. This is where the twisted irony of Putin’s war kicks in. By
invading Ukraine, Putin has made Biden’s midterm outlook even more dire
than it was. The voter enthusiasm gap between Republicans and Democrats —
which is historically a very accurate measure of what is going to
happen — has risen from an already flashing-red 11 percentage points
last October to 17 percentage points today. There is no way Democrats
can retain control of Congress unless these numbers change dramatically. A
Democratic loss of Capitol Hill would paralyse Biden’s domestic agenda
and commensurately boost the odds of Trump’s 2024 prospects. Military
analysts keep saying that Putin has no way out from his colossal blunder
in Ukraine. That may be true in the military theatre. But Trump’s
return to power on this side of the Atlantic would be just the kind of
endgame that could turn the geopolitical dial back in Putin’s favour.
Trump despises most of America’s European allies and admires Putin. Just
last Tuesday, on day 33 of the war in Ukraine, he publicly requested
that Putin release dirt on Hunter Biden’s alleged business corruption in
Russia. I don’t need to underline how shocking that is. |