V25, N36 Thursday, May 28, 2020 5th CD Republican Trump test Club For Growth takes aim at Henderson, Brizzi on behalf of Spartz; 1st CD McDermott’s to lose By BRIAN A. HOWEY INDIANAPOLIS – The open 5th CD seat has now become a Republican primary referendum on President Trump. This past week, Club For Growth Action PAC, which has endorsed State Sen. Victoria White house, you don’t want Carl Brizzi in the House.” Spartz, began airing two attack An ad against Henderson features a CNN video TV ads at Spartz’s two rivals who pose the biggest threat clip with Henderson saying about Trump, “I don’t like his to her nomination, former Marion County prosecutor Carl outbursts and his inappropriateness with the public and his Brizzi and Atlanta businesswoman Beth Henderson. scruples.” The ending ad voiceover says, “Yep, Henderson The ad against Brizzi features him on a WIBC ra- sounds like Nancy Pelosi.” It adds that she joined a group dio show, saying, “I’m not a Trump guy. I know the orange pushing for Trump’s impeachment, with the voiceover say- man does crazy things. I did not vote for Trump.” The Continued on page 3 ending voiceover says, “If you want President Trump in the How do we recover? By LARRY DeBOER WEST LAFAYETTE — Enough already. The economy is bad. This is the sharpest, deepest recession in 80 years. We get that. Let’s talk about some- thing else. Like, how does the economy recover? Unfortu- “We’ve got to make sure we nately, to answer that question we need to know what kind of protect and strengthen our small recession we’ve got. So let’s look at some measurements that tell businesses. That first and fore- us what’s been happening. most starts with how we can get Gross domestic product measures the value of goods and people comfortable and safe services produced in our econ- going outside their homes, re- omy. The growth of GDP is our most complete measure of how turn to work and spend money.” well the economy is doing. Most - Speaker Todd Huston, to the of the time we show the quar- terly numbers at annual rates, NFIB webinar on Wednesday Page 2 basically multiplying by four, and we stores and gas stations were essen- look at “real” GDP, which removes tial businesses. Most remained open. the effect of inflation. Real GDP in the Their sales dropped by a third or first quarter fell 4.8%. Bad, but not more. Consumers weren’t spending, catastrophic. even when they could. But the recession started in That’s also shown in the Howey Politics Indiana March. January and February were inflation data. If most goods and WWWHowey Media, LLC fine, probably a lot like 2019. In 2019, services were in short supply, prices c/o Business Office real GDP grew 2.1%. If that growth would go up. Consumers would PO Box 6553 continued in January and February, compete to buy scarce goods, and but the whole quarter showed a 4.8% retailers would not need to cut Kokomo, IN, 46904 decline, then real GDP must have prices. We’d get higher inflation. www.howeypolitics.com fallen 19% in March. That is cata- But according to the consumer price strophic. index, prices are falling. That’s not Brian A. Howey, Publisher Twelve years ago the Great inflation, that’s deflation. Even after Mark Schoeff Jr., Washington Recession was kicked off by declining removing the influence of falling investment spending. That’s spend- gasoline prices, the CPI fell 5.2% in Mary Lou Howey, Editor ing on business buildings, equip- April. Businesses were cutting prices, Susan E. Joiner, Editor ment, software and inventories, and trying to get consumers to buy. home construction, too. Investment The drop in consumer spend- Subscriptions spending began to fall in 2007, a year ing is leading the recession. To re- before the economy as a whole, and cover, consumers must spend again. HPI, HPI Daily Wire $599 dropped 21% in 2009. Spending by What will it take? HPI Weekly, $350 households on consumer goods and Consumers need income to Lisa Hounchell, Account Manager services fell just 1.3% that year. spend. Tens of millions of people (765) 452-3936 telephone That is not what’s happening have lost their jobs. As the economy (765) 452-3973 fax this time. In the first quarter, invest- opens up, people can go back to [email protected] ment spending fell 5.8%, a little less work. But some employers have not than its 6.2% drop in the fourth quar- survived. Those that open at 50% Contact HPI ter. Consumer spending, though, fell capacity may not need as many [email protected] 7.9% in the first quarter, after rising employees. Then there’s the vicious Howey’s cell: 317.506.0883 1.8% in the fourth quarter. Spending cycle: Businesses won’t employ all in March must have dropped more their workers if sales are down; sales Washington: 202.256.5822 than 20%. Consumers are leading this can’t increase until people are em- Business Office: 765.452.3936 recession. ployed and earning income. A new report showed that Employed people earning © 2020, Howey Politics total retail sales were down 22% this income can go back to spending. But Indiana. All rights reserved. April compared to April a year ago. what if they’ve depleted their sav- Sales at restaurants were off 49%, ings or gone into debt during the Photocopying, Internet forward- but most restaurants were closed lockdown? Their initial earnings may ing, faxing or reproducing in any except for takeout and delivery. go to paying debt or rebuilding nest form, whole or part, is a violation Consumer spending was down partly eggs. The individual payments and of federal law without permission because there were fewer places to added unemployment benefits from from the publisher. shop. But auto dealers, auto parts the CARES act were meant to sup- Jack E. Howey editor emeritus 1926-2019 Page 3 port people’s finances. Let’s hope it worked. Our economic recovery comes back to the virus. People can’t shop if stores are closed. As stay- Get it under control, and consumers will feel confident at-home orders are lifted and stores reopen, shopping and enough to spend. Without that, full recovery probably spending can resume. Unless it doesn’t. A Reuters survey won’t happen. v at the end of April found that a majority of people won’t go back to movies, concerts or sporting events until there’s DeBoer is a professor of agricultural economics at a vaccine. The ultimate reason that consumers quit spend- Purdue University. ing was because they were afraid of getting sick. Spartz the nomination, though it could prove problematic Horse Race, from page 1 in a fall showdown with the expected Democrat nominee ing, “Beth Henderson: Wrong about Trump, wrong about Christina Hale, who has raised $1,052,047, had $550,494 Congress.” in expenditures and had $501,552 cash on hand per her Club For Growth President David McIntosh, who May 13 FEC report. lost a 2012 race in the 5th CD against U.S. Rep. Susan Hale’s chief nomination rival, 2018 nominee Dee Brooks, is banking on the notion that in a 15-candidate Thornton, has raised just $64,761 in her May 13 filing. GOP race, it will be ardent Trump supporters who will give The reason Hale entered the race was the notion Spartz enough momentum to win the nomination. that the 5th CD was turning purple. U.S. Sen. Joe Don- As it did for Richard Mourdock’s U.S. Senate nelly carried the district in his 2018 loss to Republican Mike campaign in 2012, Club For Growth has provided polling Braun, and Democrats picked up SD29 with J.D. Ford’s de- for Spartz (showing her with a double-digit lead and 76% feat of State Sen. Mike Delph. SD29 straddles Indianapolis name ID), endorsed her candidacy, and according to the FEC website, contributed a very modest $5,206 of the $91,882 she reported on her pre- primary filing. That comes on top of the $750,000 she loaned her cam- paign. She had spent $679,469 and had $160,713 cash on hand. The FEC reports show that Henderson has raised $445,459, had $291,331 in expenditures and had $154,128 cash on hand. She loaned her campaign $254,600. Brizzi is actually sixth on the GOP fund list (trailing Treasurer Kelly Mitchell at $331,977, Dr. Chuck Diet- zen at $303,639 and Rev. Micah Beck- with at $147,490), raising $144,761, spending $111,620 with $33,141 on hand. But Brizzi served eight years as Marion County and Hamilton County, and was the lone GOP-held district prosecutor and entered the race with the highest name ID that Hillary Clinton carried over Trump in 2016. in the field. He has also waged a TV ad campaign. Senate Majority Campaign Committee polling on Spartz, Henderson and Brizzi have had more TV ad behalf of Delph and State Sen. Jim Merritt in 2018 showed exposure than the rest of the field. So McIntosh has taken that Trump was under water in their districts. Several aim at Henderson and Brizzi, using Trump as a wedge. It sources told HPI that Trump’s approval was well south of may deliver the nomination to the Noblesville Republican Trump’s 47% Indiana approval. who was elected via caucus to finish out Senate Appropria- Trump probably remains popular in the northern tions Chairman Luke Kenley’s General Assembly term, then part of the 5th CD, an area where Henderson was ex- bolted her reelection campaign and opted for this congres- pected to do well.