The Age of Trump: Bases of His Support, Policy Options, and the Future of American Politics

Henry E. Brady Dean, Goldman School of Public Policy The Signs

• Rise of Trump in Republican Party and Sanders in Democratic Party

• Large Number of Free-Floating Independents

• Possible New Cleavage Structures in American Politics Trump and Sanders Ordering the Candidates from Outsiders to Insiders for Each Party Democrats -- Senator: Sanders (“outsider”) -- Senator/Secretary of State: Clinton (“insider”) Independents Republicans: -- Governors: Bush, Christie, Kasich (“insiders”) -- Senator: Rubio (“insider”) -- Surgeon/Talk Show Personality: Carson (“outsider”) -- Senator: Ted Cruz (“outsider”) -- Businessman: Donald Trump (“outsider”) Percentage of Respondents to Survey Supporting Each Candidate

Democrats Republicans

Democrats (in blue) evenly split between Sanders and Clinton

Republicans (in Red) mostly for Trump

Independents (in purple) not yet decided— about 10% of population Socio-Economic and Political Characteristics Religious Orientation

Democratic Republican Candidates Candidates

SYMMETRY: OUTSIDERS HAVE FEWER RELIGIOUS SUPPORTERS Trump Support Sanders Supporters least religious (15%) Sanders Not as Support Religious Trump Supporters about as religious (35%) With Little as Other as Clinton Supporters Interest in Republi- Religion cans Rubio, Carson, Cruz supporters most religious (around 45% to 50%) Educational Level—Income Level is Similar

Democratic Republican Candidates Candidates SYMMETRY: OUTSIDERS HAVE LESS WELL EDUCATED SUPPORTERS

Trump supporters least educated (only 20% College or more and 50% High School or Less)

Sanders supporters somewhat more Sanders Trump educated (27% College or more and only Support Support 29% High School or Less) but still low. With Low with Low Education Education Governors, Rubio, Cruz supporters most educated (about 41% College or more and only 29% High School or Less) SUMMARY

• Sanders supporters not very religious, not very educated, and 75% white

• Trump supporters not that religious, low education, 91% white, and low average income

• Non-Trump Republican supporters very religious, highly educated, in-between on race and ethnicity, and much higher average income Issues: Economic Issues, Social Issues, and Terrorism ATTITUDES TOWARDS ECONOMIC ISSUES: Is it harder to succeed now than in past?

Democratic Candidates Republican Candidates

SYMMETRY

Sanders supporters think it is now a little Sanders Trump Harder to succeed in America Supporters Supporters Think it Think it Trump supporters mostly agree that it is a Harder to Harder to Little harder to succeed in America Get Ahead Get Ahead Now Now ECONOMIC ISSUES: Oppose or Favor Free Trade?

Democratic Republican Candidates Candidates SYMMETRY:

Trump supporters slightly oppose free trade Trump Supporters Sanders supporters neither favor nor oppose Oppose Sanders Free Trade Other supporters favor it slightly Supporters Not In Favor Of Free Trade ATTITUDES TOWARDS SOCIAL GROUPS: Feelings Towards Groups

Democratic Republican Candidates Candidates

ASYMMETRY

Sanders and Clinton supporters mostly Favorable towards feminists, gays and Republicans lesbians, and Muslims (60 degrees) Democrats And Trump Positive Supporters Trump Supporters least Favorable (40 degrees) Towards Negative Groups About Groups FEARS OF TERROR ATTACK: Do you worry about a terror attack?

Democratic Republican Candidates Candidates ASYMMETRY

Trump Trump supporters moderately to very Democrats Supporters Worried about a terrorist attack Only Most Slightly Worried Sanders supporters only slightly worried Worried About Terrorism Other supporters in-between IDENTITY AS AN AMERICAN: How important is your identity as an American?

Democratic Republican Candidates Candidates ASYMMETRY

Trump supporters think their “identity As an America” is very to extremely Sanders Important Trump Supporters Supporters See American Sanders supporters only think it is See Identity as Only Moderately important American Moderately Identity Important as Very Important The Klinker Article – In Vox, June 2, 2016 TITLE OF ARTICLE: “The easiest way to guess if someone supports Trump? Ask if Obama is a Muslim” • Problems with This: • Not actually supported by the data – Party identification and ideology are much stronger • My analysis of same data shows that BOTH economic issues and xenophobia are important • Klinker argument is convenient one for both Left and Right – Donald Trump is a racist whose constituency and issues can be ignored SUMMARY – Sanders and Trump as Economic Populists

• SYMMETRY ON ECONOMIC ISSUES: Sanders supporters most worried about economic opportunity, but Trump supporters not far behind; Trump supporters most anti-free trade and Sanders supporters not far behind.

• ASYMMETRY ON SOCIAL ISSUES AND RACE: As we go to the right, candidate supporters less favorable towards gays, feminists, Muslims, and blacks with Trump supporters least favorable;

• ASYMMETRY ON XENOPHOBIA: As we go to the right, fears of terror attack and identity as an American are greater Tom Watson – 1856-1922

• Politician from Georgia

• In 19th Century • Member of Congress with Populist Party • Condemned lynching • Advocated for poor whites and blacks and regulation of the railroads

• In 20th Century • Racist with nativist attacks on blacks Past Job Experience of Presidential Candidates Since 1828 – with at least 10% of Vote

Years Total Governor, General or Cabinet Total % with Number Senator, Elected Post High Level Remaining Candidates: Of or Vice Member of Government “True Outsiders” Distinct President Congress Experience Candi- dates

1828-1856 12 10 83% 2 17% 0 100% 1860-1892 15 9 60% 5 33% 0 93% Horace Greeley (1872) 1896-1928 14 9 71% 2 11% 2 11% 91% Alton Parker (1904) 1932-1976 16 14 88% 1 6% 0 94% Wendell Wilkie (1940) 1980-2012 13 12 92% 0 0 92% Ross Perot (1992) Past Elections with “Outsiders” (Not President, Vice President, Senator, Governor, General, Cabinet Member, or Speaker of House) – Since 1868 First Name is Outsider; Winner is in Blue; Bold entries are “true outsiders” • 1872: Horace Greeley (Dem) and Ulysses Grant (Rep) • Greeley was newspaper editor, had been appointed to Congress for 3 months; Grant had been a General • 1896: William Jennings Bryan (Dem) and William McKinley (Rep) • Bryan had been elected to Congress; McKinley had been a Governor • 1900: William Jennings Bryan (Dem) and William McKinley (Rep) • Bryan had been elected to Congress; Mckinley had been a Governor • 1904: Alton Parker (Dem) and Theodore Roosevelt (Rep) • Parker was an Appellate Judge; Roosevelt was Vice President • 1908: William Jennings Bryan (Dem) and William H. Taft (Rep) • Bryan had been elected to Congress; Taft had been Secretary of War • 1924: John W. Davis (Dem) and Calvin Coolidge (Rep) • Davis had been elected to Congress; Coolidge had been Governor • 1940: Wendell Wilkie (Republican) and Franklin D. Roosevelt (Dem) • Wilkie was a businessman; Roosevelt was President (and had been Governor) • 1992: Ross Perot (Independent) and George H.W. Bush (Rep) and William Clinton (Dem) • Perot was a businessman; Bush was Vice President; Clinton had been Governor Policy Directions Health, Economics, and Other Areas Obama Care • Features of Obama Care Coverage: • Ten essential benefits are covered • Pre-existing conditions cannot preclude coverage • Young adults are covered until age 26 • Prohibition of annual or lifetime limits • Features of the Obama Care System • People could keep their existing employer coverage if it meets standards of Obama care (some exemptions to this until 2017 in some states) • People without coverage could get it through exchanges (about 6% of total) • Poor people would be subsidized further through Medicaid for states that chose to do this (all but 19)—subsidies up to 138% of poverty • People without coverage would be “mandated” to get it and fined if they did not • Businesses are “mandated” to provide care Impacts of Obama Care

• Many people could get coverage who could not (easily or at all) get it in the past: • Poor people • Young adults until age 26 on parents plan • People with pre-existing conditions • People who faced lifetime or annual limits on care • Some people’s coverage has changed • Some people lost (or will lose) their coverage if it does not cover the ten required benefit areas or falls afoul of other ACA regulations • Some people have found that co-payments or other costs have changed – but it is hard to be sure that this was an ACA effect • Overall Costs of Health Care Coverage have increased at a decreasing rate – but it is hard to be sure that this is an ACA effect although many scholars think it is How is Obama Care Paid For? ObamaCare Taxes That Probably Will Not Directly Affect the Average American • 2.3% Tax on Medical Device Manufacturers began in 2014; 10% Tax on Indoor Tanning Services began in 2014; Blue Cross/Blue Shield Tax Hike • Excise Tax on Charitable Hospitals that fail to comply with the requirements of ObamaCare; Tax on Brand Name Drugs; Tax on Health Insurers; $500,000 Annual Executive Compensation Limit for Health Insurance Executives • Employer Mandate on business with over 50 full-time equivalent employees to provide health insurance to full-time employees. $2,000 per employee – $3,000 if employee uses tax credits to buy insurance on the exchange (AKA the marketplace). (starting 2015 for employers with 100 or more FTE and 2016 for those with 50 or more.) • Medicare Tax on Investment Income. 3.8% over $200k/$250k; Medicare Part A Tax increase of .9% over $200k/$250k ObamaCare Taxes That May Directly Affect the Average American • 40% Excise Tax “Cadillac” on high-end Premium Health Insurance Plans 2018 • An annual $63 fee levied by ObamaCare on all plans (decreased each year until 2017 when pre-existing conditions are eliminated) to help pay for insurance companies covering the costs of high-risk pools. • Medical Deduction Threshold tax increase began in 2013: Threshold to deduct medical expenses as an itemized deduction increases to 10% from 7.5%. • Individual Mandate (the tax for not purchasing insurance if you can afford it). Starting in 2014, anyone not buying “qualifying” health insurance must pay an income tax surtax at a rate of 1% or $95 in 2014, to 2.5% in 2016 on profitable income above the tax threshold. The total penalty amount cannot exceed the national average of the annual premiums of a “bronze level” health insurance plan on ObamaCare exchanges. What Can Republicans Do? • Features of Obama Care Coverage: • Ten essential benefits are covered – could be reduced • Pre-existing conditions cannot preclude coverage – very popular • Young adults are covered until age 26 – very popular • Prohibition of annual or lifetime limits – could be changed • Features of the Obama Care System • People could keep their existing employer coverage if it meets standards of Obama care (some exemptions to this until 2017 in some states)—change requirements • People without coverage could get it through exchanges (about 6% of total)—redesign exchanges to make them more competitive (perhaps across states) • Poor people would be subsidized further through Medicaid for states that chose to do this (all but 19)—subsidies up to 138% of poverty – Reduce subsidies perhaps through block grants to states. • People without coverage and businesses not providing care would be “mandated” to get it or provide it and fined if they did not – could get rid of mandates • Taxes – Some or all of the taxes could be abandoned Economic Policy

• Condition of the Economy – • Good in terms of jobs with 4.8% unemployment rate and 227,000 jobs this month – a very long expansion of jobs • Less good in terms of middle class incomes – although data from last year suggest the first significant rise in middle class incomes • Less good in terms of percentage of people (around 9%) looking for better work • Options • Fiscal stimulus • Spending through infrastructure – while interest rates are low • Tax cuts – but who will benefit? Trump’s Tax Plan

• Significantly reduce marginal tax rates on individuals and businesses, • Increase standard deduction amounts to nearly four times current levels, and • Curtail many tax expenditures. • Largest benefits to richest households • Reduce federal revenues by $9.5 trillion over its first decade before accounting for added interest costs or considering macroeconomic feedback effects. • Improve incentives to work, save, and invest. • But if not accompanied by very large spending cuts, it could increase the national debt by nearly 80 percent of gross domestic product by 2036, offsetting some or all of the incentive effects of the tax cuts.

Four Macro-Economic Effects

• Substitution Effect: lower tax rates increase incentives to work, save, and invest. • Income Effect: (offsets the first): tax cuts raise the after tax return to labor, saving, and investment, which makes it easier to reach consumption targets, such as paying for college or retirement. Because taxpayers feel richer, some decide to work, save, or invest less. • Financing Effect: Is it financed through spending cuts or increased federal borrowing? If the immediate revenue loss from a tax cut is not offset with spending reductions, the higher federal deficits reduce net national saving. Increased federal borrowing crowds out private investment, raising interest rates and the cost of capital and depressing economic growth. • Base Broadening: Broadening the base by reining in distortionary tax expenditures reduces the role of taxation in determining the allocation of resources across the economy, which in turn can increase economic output. But some tax expenditures tend to increase with income, meaning that base broadening can increase effective marginal tax rates on an additional dollar of earnings by raising the cost of some goods and services purchased with the earnings. Historical Results

• Tax Changes in 1981, 1986, 2001,and 2003: Little impact of taxes on growth. • Deficit financed tax cuts less effective at promoting growth than cuts of unproductive government spending. • Problems: • Effective tax rates RIGHT NOW are not so high as to discourage that much work • Costs of financing tax rates about to go up as the Fed raises the interest rate • Economy near full capacity so that stimulus might lead to inflation

GDP Groth Rate by Quarters:

Increasing Number of Independents Partisanship from 1939 to 2014

Democrats The Rise of Republicans Independents

Independents

Note: 1939-1989 yearly averages from the Gallup Organization interactive website. 1990-2014 yearly totals from Pew Research Center aggregate files. Based on the general public. Data unavailable for 1941. Independent data unavailable for 1951-1956. New Cleavage Structures? Right

Conservative Right Wing Populists Conservatives Huey Long Robert Taft Where are Hilary Clinton George Wallace Ronald Reagan Pat Buchanan George W. Bush And Bernie Sanders on Donald Trump Ted Cruz This Picture? Social/Moral Race/Identity Dimension Liberals Eisenhower Lyndon Johnson Republicans Jimmy Carter Nelson Rockefeller Walter Mondale Pete Wilson Left Al Gore Arnold Schwarzenegger Source: Jennifer Victor; Liberal Lee Drutman Left/Liberal Economic Dimension Right/Conservative Right Cleavage in 1960

Conservative Right Wing Populists Conservatives Huey Long Robert Taft Where are Hilary Clinton George Wallace Ronald Reagan Pat Buchanan George W. Bush And Bernie Sanders on Donald Trump Ted Cruz This Picture? Social/Moral Race/Identity Dimension Liberals Eisenhower Lyndon Johnson Republicans Jimmy Carter Nelson Rockefeller Walter Mondale Pete Wilson Left SANDERS? All Gore Arnold Schwarzenegger Liberal Source: Jennifer Victor; Clinton? Lee Drutman Left/Liberal Economic Dimension Right/Conservative Parts of the Republican Party

CONSERVATIVE • White Christian Fundamentalists WHITE • Jerry Falwell TRADITIONAL CHRISTIAN CONSERVATIVES • Pat Robertson FUNDAMENTALISTS • Michael Huckabee • Ron Santorum • Traditional Conservatives • George W. Bush • Ted Cruz Social • Marco Rubio Dimension • Libertarians • Steve Forbes • Ron Paul POPULIST • Populist Right LIBERTARIANS RIGHT • Pat Buchanan • Donald Trump MODERATE MODERATEEconomic Dimension CONSERVATIVE Parts of the Democratic Party

MODERATE • African Americans • Jesse Jackson AFRICAN- NEW DEAL • Barack Obama (?) AMERICANS DEMOCRATS • New Deal Democrats • FDR • Barack Obama (?) • Clinton Democrats Social • Jimmy Carter Dimension • Bill Clinton • Hillary Clinton • Populist Left—Sanders Democrats POPULIST CLINTON • Sanders LEFT DEMOCRATS LIBERAL LIBERALEconomic Dimension MODERATE Putting it all together

• White Christian Fundamentalists WHITE CONSERVATIVE TRADITIONAL • Jerry Falwell CHRISTIAN CONSERVATIVES • Pat Robertson FUNDAMENTALISTS • Michael Huckabee • Ron Santorum • Traditional Conservatives • George W. Bush POPULIST LIBERTARIANS • Ted Cruz RIGHT Social • Marco Rubio Dimension • Libertarians AFRICAN- NEW DEAL AMERICANS DEMOCRATS • Steve Forbes • Ron Paul • Populist Right • Pat Buchanan POPULIST CLINTON • Donald Trump LEFT DEMOCRATS LIBERAL LIBERALEconomic Dimension CONSERVATIVE Observations

• It matters a great deal whether the “social dimension” is about social issues (e.g., abortion, gay rights, schooling, prayer, personal behavior) or about race and ethnicity (e.g., immigration, black lives matter, Muslims) • My diagram really focuses on defining the social dimension as the classic social issues • If the social dimension has become race, then somewhat different placements are likely • It matters whether the economic dimension is classic social welfare issues (e.g., Obamacare, Social Security, Keynesian priming the pump) or a new dimension having to do with free trade and perhaps taxes • My diagram uses the New Deal social welfare economic dimension Parts of the Republican Party

CONSERVATIVE • White Christian Fundamentalists WHITE • Jerry Falwell TRADITIONAL CHRISTIAN CONSERVATIVES • Pat Robertson FUNDAMENTALISTS • Michael Huckabee • Ron Santorum Current Core of the Republican Party • Traditional Conservatives • George W. Bush • Ted Cruz Social • Marco Rubio Dimension • Libertarians • Steve Forbes • Ron Paul POPULIST • Populist Right LIBERTARIANS RIGHT • Pat Buchanan • Donald Trump MODERATE MODERATEEconomic Dimension CONSERVATIVE Parts of the Republican Party

CONSERVATIVE • White Christian Fundamentalists WHITE • Jerry Falwell TRADITIONAL CHRISTIAN CONSERVATIVES • Pat Robertson FUNDAMENTALISTS • Michael Huckabee • Ron Santorum • Traditional Conservatives • George W. Bush New Core? Where do they go? • Ted Cruz Social • Marco Rubio Dimension • Libertarians • Steve Forbes • Ron Paul POPULIST • Populist Right LIBERTARIANS RIGHT • Pat Buchanan • Donald Trump MODERATE MODERATEEconomic Dimension CONSERVATIVE