What We’re Hearing from Washington Insiders as the Campaign Begins
Author: Greg Valliere
June 9, 2020
FIRST AND FOREMOST, no one in Washington can figure out the roaring stock market. Is it reflecting an improving economy, with more stimulus to come, or is this astonishing rally fueled by speculators who could bail out later this summer?
EVERY FEW MONTHS we summarize views from Washington insiders; this update, not surprisingly, finds many in this city are perplexed. Is Joe Biden really headed for a landslide? Is the coronavirus really in the rear view mirror? Read on . . .
THE BIG POLITICAL STORY has very little to do with Biden; it’s a growing sentiment that Donald Trump has not handled the virus or race relations very well and is in serious danger of losing his re-election.
YET THE REPUBLICANS WE TALK WITH are convinced that a furious Trump comeback is coming. “He’ll go negative, he’ll rip Democrats, calling them socialists who want to defund the police,” one GOP staffer predicts, adding that “Trump hasn’t really begun to define Biden yet.”
AND DEMOCRATS EXPRESS ANXIETY over Biden’s frequent gaffes. “He can’t stay in his basement for the rest of the summer,” one Democrat says. Everyone in the party we talk with worries that the former vice president could stumble in the debates this fall — but they add that Biden can be a racial healer, unlike Trump. An African-American VP running mate is very likely.
ANXIETY OVER A DISPUTED ELECTION: This comes up with alarming frequency. There’s a suspicion that Trump will declare the election “rigged” because of disputed mail-in ballots. If Biden appears to win by a razor-thin margin, could Trump demand a court injunction seeking to invalidate mail-in ballots?
SELF-CONGRATULATION ON THE VIRUS: Covid-19 cases are rising in several states but many in Washington, incredibly, have moved on. A vaccine is coming, they say, and emergency room heroes are saving more patients with new techniques. One problem: many people are still reluctant to go to restaurants, malls, etc.
HIGH GRADES IN WASHINGTON go to Jerome Powell. The Fed Chairman is likely to express a little cautious optimism when he meets with the press tomorrow, but there’s no doubt that Powell will stay accommodative for a very long time to come.
WISH LIST FOR NEXT BILL: Lobbyists are gearing up for this summer’s final pandemic stimulus bill, and there will be a feeding frenzy to get pet projects included. Heading the wish lists — for congressional Republicans, liability reform; for the White House, a payroll tax cut; for Democrats, aid to state and local governments. Look for lots of tax incentives, including a bonus for people who return to work.
CHINA DISPUTE WON’T END SOON: It’s difficult to find anyone in Washington — aside from officials at the U.S. Chamber of Commerce — who would like to deal with China right now. And many of the most strident China hard-liners, other than Trump, are Democrats.
REGULATORY OVERHAUL: A huge story in Washington that has been overlooked is the dramatic easing of federal regulations — hundreds new rules killing regs on financial institutions, worker protection, the FDA, and of course the environment A lightning rod for environmentalists is EPA chief Andrew Wheeler, not a household name but a major player in Washington.
SCANDALS — A SLEEPER ISSUE: Republican Sen. Ron Johnson has won sweeping subpoena authority in his attempt to embarrass Biden with a probe Obama-era excesses, and U.S Attorney John Durham is aggressively probing the origins of the Trump-Russia investigation. Both probes will be timed for release just before the election. Democrats, meanwhile, are eagerly awaiting a tell-all book later this month from former national security adviser John Bolton.
SO THE STAGE IS SET for a thrill-a-minute campaign, among the wildest in U.S. history, We’ll go out on a limb this morning and predict that yesterday’s CNN poll — showing Biden ahead by 14 points — will be the former vice president’s high-water mark for the entire campaign.
IT’S WAY TOO SOON TO MAKE A CALL, most Washington insiders say, but they agree that Trump is about to go on the offensive. It won’t be pretty, but it will narrow Biden’s lead.
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