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It has been about two weeks since Former Vice President Joe Biden was elected to serve as the 46th President of the United States, crossing the 270 Electoral College threshold with a win in Pennsylvania. Throughout the race, the Biden and Trump campaigns worked to promote their message and vision for America in an effort to win over undecided voters and encourage more turnout. The COVID-19 pandemic prompted states to change their voting rules, presenting Americans with more options to vote, including mail-in ballots. As a result, nearly 160 million Americans are projected to have cast ballots in this election, which marks the highest voter turnout rate among eligible citizens since 1900. Democrats held the advantage in turnout for initial balloting, and early voting accounted for roughly 50% of the total votes counted in 2016 one week before November 3, as outlined by the figure below:  While Democrats seemed more galvanized to vote early and by mail, Republicans led with in-person voting, an indicator that President Donald Trump’s unfounded claims over mail-in voting fraud resonated with many of his supporters. Most Republican voters were expected to vote in very large numbers in-person on Election Day, and the strong Democratic turnout added pressure to the GOP to mobilize its voters during the final stretch of the race. The month leading up to the election saw several new developments on the political and policy fronts. They followed the 2020 theme of uncertainty and surprise, as President Trump contracted COVID-19 after a White House event for the newly confirmed Supreme Court Justice Amy Coney Barrett. Despite his swift recovery from the virus, the event drew criticism over the lack of precautionary measures displayed by the White House and created a major setback for President Trump’s plans to hit the campaign trail and attend the second presidential debate. The final debate was a significant improvement from the first; both candidates appeared poised, sparring over several issues, including corruption allegations against the Former Vice President’s ties to foreign entities and President Trump’s tax returns. In addition, the Federal Bureau of Investigations issued a warning to the American people alerting them of election interference by foreign adversaries, such as Russia and Iran, through “suspicious email campaigns targeting elected officials.” The ongoing COVID-19 stimulus negotiations between the White House, House Democrats, and Senate Republicans failed to produce an agreement over a bill, as each side did not want to give the other a major legislative victory before the election. Senate Republicans did deliver a major win for the GOP with the confirmation of Justice Barrett to the Supreme Court, leading many Democrats to consider “court-packing.” Lastly, the presidential polls remained virtually unchanged up until Election Day, and they offered an imperfect snapshot into what occurred. Polling Data – National, Battlegrounds, and 2016 Comparisons The Real Clear Politics (RCP) average (chart below) showed a +7.2 advantage for Biden on November 2, but the final result was Biden +3.4, which reveals a much closer race and margin than anticipated. Biden’s dominance of the polls certainly lined up with the eventual favorable outcome for the Democratic nominee, but a new Berkeley Haas study found that most election polls report a 95% confidence level and the eventual result lines up with polling only 60% of the time. The analysis focuses on accounting for unknown variables or sources of inaccuracy that most pollsters often fail to consider, including last-minute changes in voter intentions, enthusiasm, and partisan non-response bias, a phenomenon that occurs when people who ignore pollsters possess very different traits from those who respond.  Regardless of the unpredictability, history indicates that Biden held an unprecedented advantage for a challenger that late in the campaign. Only one other challenger - Bill Clinton in 1992- maintained a polling margin that wide leading up to Election Day since 1936, when scientific polling as first conducted during an election cycle. The RCP average for battleground states revealed a much closer polling gap between Trump and Biden, which painted a far more accurate snapshot into the final outcome. On average, Biden had a slight +2.3 lead in the top six battlegrounds (chart below), and the results have held with the exception of Florida, where Trump defeated his Democratic opponent on election night.  In comparing the 2020 polls to 2016, Hillary Clinton was polling +3.3 on Election Day, or -3.9 than where Biden was polling (RCP figure below). There are a variety of factors at play that could explain why Biden’s lead was wider.  First, the “October Surprise” of the emails reportedly found on Hunter Biden’s laptop that describe activities linking the Democratic nominee to a foreign intelligence operation may not have had the same effect that the release of the Comey letter had on Clinton in October 2016, assuming that this effect is measured by decreases in polling performance. Other potential factors could be that Democrats were more willing to respond to pollsters, or that many voters were shy to express their support for Trump because it is not the “socially desirable answer,” which leads to polling errors. The Cato Institute found that about 67% of Americans say that the political climate is too harsh that they would rather not reveal their true political opinions. Voters may have also been less willing to reward the incumbent for good performance on key issues like the economy due to other pressing priorities, including addressing the pandemic and racial injustice. Demographics and Enthusiasm The changing American electorate presented both campaigns with unique challenges during the 2020 race due to shifting demographics and coalitions among the American electorate. The Pew Research Center evaluated these new trends and the impacts on each party’s voting blocs. Highlights of their findings and analyses from other reports are below. Race
Enthusiasm Overall, enthusiasm and political engagement have been higher on average among Americans during this election cycle. One recent Gallup survey found that nearly 75% of Americans say they have “given their vote much thought.” When it comes to how strongly voters were backing their chosen candidate, 66% of Trump supporters said they support him strongly, while just 46% of Biden supporters said the same. The enthusiasm metric is something that President Trump has continued to highlight by pointing to the high turnout at his rallies. Biden’s campaign had less opportunities to show any of their backers’ enthusiasm, as they held events under social distancing guidelines. Excluding 2020, the winner held the enthusiasm advantage throughout the campaign three of the last five elections, including Trump in 2016. While Trump was unable to secure a victory off of enthusiasm, he managed to gain 7 million new voters during this election. Key Policy Priorities for Voters and Emerging Issues Analysis conducted by the Pew Research Center identified the top five priorities for voters in this election, which lead off with the economy, health care, Supreme Court appointments, COVID-19, and addressing violent crime. Democrats appear to have an edge on all except the economy, where most reports note that Republicans have the advantage. One point that drove recent political discussions was over the likelihood that the country would know who won the presidency on November 3rd. Both candidates were asked to voice their commitment to a peaceful transfer of power regardless of the outcome, and both President Trump and Democratic nominee Biden signaled that they would accept the results. Notably, a majority (68%) of American adults did not expect to know who won the presidency on Election Day, according to an NBC News tracking poll. They also held varying predictions on the timeline for when the country would learn the final outcome.
Delays over declaring the winner on November 3rd were likely due to the high volume of mail-in ballots, varying state laws over how to count them, and the tight margins. Battlegrounds like Pennsylvania did not begin counting early ballots until Election Day, taking them longer to process and verify. Other emerging issues that became a key focus on the campaign trail included “court-packing” and the politics of fracking. A recent Fox News poll reported that only 31% of likely voters favor packing the courts. The responses were mostly skewed based on political party, which likely reflects partisan attitudes toward the confirmation of Justice Barrett. When asked to publicly comment on the matter, Biden mentioned that he “may reveal his stance before Election Day.” On the issue of fracking, President Trump emphasized its importance during his rallies, especially when relaying his message with the Pennsylvania electorate. Despite his attempts to backtrack from statements made against the oil and gas industry during the primaries, Biden has yet to clearly communicate his stance on fracking, which the Trump campaign used to launch attacks, in an effort to secure the swing state into its win column. Pennsylvania, which won Biden the presidency, saw intense campaigning towards the end of the race, including three Trump rallies in one day, and ex-President Barack Obama delivered remarks on Biden’s behalf, highlighting its importance. The Paths to Victory Absent the success of court challenges filed by the Trump campaign in several states to contest the results in the election, Former Vice President Joe Biden and his running mate, Senator Kamala Harris (D-CA), will achieve a historic victory. Harris will be the first woman, first African-American and first South Asian-American to serve as Vice President. 270 electoral votes are needed to win the presidency, and Biden has already amassed 290 compared to Trump’s 217 after a victory in Alaska. Democrats successfully flipped Pennsylvania, Michigan, Wisconsin, and Arizona. Georgia and North Carolina remain uncalled, and Nevada showed a competitive race. Despite Biden’s victory, President Trump has not conceded, as his campaign continues to file lawsuits over voting fraud, irregularities with counting, and request recounts. Presidential polling throughout the race largely conveyed the narrative that Former Vice President Biden had a higher chance of winning the election, and they were correct, but not by as large of a margin as they projected. Recent content in the news cycle, including strong economic metrics and Biden’s link to his son’s foreign business dealings, may have altered the polls by influencing last-minute voters, but the margin appeared to be too formidable for the Republican incumbent to overcome. The whole year has been marked by simultaneous crises and political disruption, resulting in a deeply divided country over values and beliefs. To unify Americans, Democrats and Republicans presented their policies as the better path for the country’s direction. In the end, American voters ultimately decide which message offers a better vision for leadership, unity, and prosperity.
The views expressed above are solely the author's and are not endorsed by the Virginia Policy Review, The Frank Batten School of Leadership and Public Policy, or the University of Virginia. Although this organization has members who are University of Virginia students and may have University employees associated or engaged in its activities and affairs, the organization is not a part of or an agency of the University. It is a separate and independent organization which is responsible for and manages its own activities and affairs. The University does not direct, supervise or control the organization and is not responsible for the organization’s contracts, acts, or omissions.
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Some of America’s largest and most powerful companies have found themselves under fire in recent months as Washington, DC targets Silicon Valley. These companies have done the impossible in 2020 – given progressives and conservatives a common enemy. “Big Tech” companies like Facebook, Twitter, Google, Apple, and Amazon have drawn bipartisan outrage from Republican and Democrats in Congress, as well as the Trump administration. These firms now face questions over their adherence to two pieces of legislation which you may not be familiar with: Section 230 of the Communications Decency Act of 1996, and the Sherman Antitrust Act of 1890, a landmark piece of legislation outlawing monopolies and anti-competitive behavior. Section 230 of the CDA has two key provisions that some accuse social media companies of exploiting. Subsection C states that internet companies are not legally liable as publishers for the content that someone else might post on them. This means that, if I post a lie about you online, you can sue me but not Twitter. Put another way, if someone spreads dangerous disinformation on Facebook, Facebook is legally protected from bearing responsibility. The same subsection also says the companies are not liable for “any action voluntarily taken in good faith to restrict access to or availability of material” that they deem objectionable. If Facebook or Twitter removes your content “in good faith” for violating their rules, that is legally protected. Section 230 is often referred to as “the law that created the internet” because it allowed users to flood the web en masse and generate endless amounts of content without the hosting companies being forced to review every item for their own protection. However, platforms like Twitter and Facebook have been accused of not doing enough to remove violent content, hate speech, and massive amounts of disinformation related to American politics and even the COVID-19 pandemic. YouTube (now owned by Google) has been one of the most prolific platforms for the spread of baseless and dangerous conspiracy theories, including QAnon and Pizzagate. Twitter has struggled to moderate banned content, including revenge porn. Perhaps most infamously, Russian disinformation was put in front of 126 million in the run-up to the 2016 election via Facebook. Conservatives have accused the Big Tech companies of liberal bias and allege that they are “censoring” conservative content. Those allegations became supercharged in recent weeks when Twitter froze the conservative New York Post’s account and blocked a link to a story about alleged wrongdoings by Hunter Biden, son of former Vice President and Democratic presidential nominee Joe Biden, on the grounds that it may have been illegally obtained. Speech on Big Tech platforms is not the only legal issue facing these companies, however. The platforms and their structures themselves have drawn legal attention, most notably in a US Justice Department lawsuit filed against Google in October that referred to the company as “an unlawful monopolist.” Showing Big Tech’s penchant for drawing bipartisan offense, progressive icon Senator Elizabeth Warren (D-MA) praised DOJ’s move and called for them to be more aggressive. Separately in Congress, the House Judiciary Democrats released a report citing illegal monopolistic behavior by Amazon, Apple, Google, and Facebook and comparing the Big Tech firms to “the kinds of monopolies we last saw in the era of oil barons and railroad tycoons.” Amazon, Apple, and Google all face potential violations of the Sherman Act by unfairly promoting their own content on their marketplaces and suppressing third party options for consumers. Amazon controls 40% of online retail, which is seven times larger than its nearest competitor, Walmart. Amazon charges ever-increasing fees for third party sellers, promotes its own brand (Amazon Basics), and is not transparent about how items get placed in its “Buy Box” - which some estimates suggest lead to 80% of sales on the platform. Apple only permits the Apple App Store on its devices and does not allow for any other mechanism for users to install applications. Apple subsequently charges a 30% commission on third-party operated apps, including subscription services, on top of a $99 fee for developers to gain access to the App Store. This notably led to a legal battle between Apple and the parent company of the popular game Fortnite, which tried to circumvent Apple for in-app purchases and ultimately removed the game from the Apple App Store. Google’s actions earned it the honor of being the first technology antitrust suit brought by the Justice Department since the landmark Microsoft case in the 1990s. Google has gradually begun to prioritize its own products in search results (Google Maps over Yelp, Google Flights over Expedia, etc.) and has drawn ire for how many of its top results are paid ads. However, smartphones are where Google has really run into questions of monopolistic tendencies. Between owning the default apps and search function on Android phones (about 75% of the global mobile market) and being the default search engine on Apple’s Safari app, Google is now the default search provider for 99% of the cell phones on Earth. Facebook’s Mark Zuckerberg, Google’s Sundar Pichai, and Twitter’s Jack Dorsey were summoned before the US Senate Commerce Committee on October 28th and grilled for hours over their moderation practices and monopolistic practices. US Senator Ted Cruz (R-TX) may have landed the most memorable (and inaccurate) line of the day by hollering, "Mr. Dorsey, who the hell elected you and put you in charge of what the media are allowed to report and what the American people are allowed to hear?" It should be pointed out to Senator Cruz that the New York Post story was accessible to anyone visiting the Post’s website and in the print edition. Of course, anyone opting to use Twitter does so by agreeing to their terms of service, which clearly state, “We reserve the right to remove Content that violates the User Agreement….” Any and all Americans are free to not use Twitter, or sign up for alternatives. In various ways, these issues represent information literacy problems in America that we shouldn’t be asking social media companies to fix for us. There have been a slew of proposals limiting companies’ protections under Section 230 from both sides of the aisle. Conservative firebrands such as Rep. Louie Gohmert (R-TX) and Senator Josh Hawley (R-MO) have proposed legislation requiring further examination of companies’ content algorithms or moderation practices by the federal government in order to receive liability protections. Senator Warren also wants to take a look at social media companies’ algorithms, with the focus on how they might promote disinformation and radicalization. She called to “break up” the companies during her presidential campaign. The Trump Administration has also jumped into the fray, using the Federal Communications Commission (FCC) to announce that it intends to “clarify” how companies are protected under Section 230. Time - and the results of the 2020 election for control of the White House and Congress - will tell how these companies end up faring in their fights with lawmakers and regulators. Joe Biden has also called for “revoking” Section 230 and is expected to be sympathetic to Congressional antitrust efforts. Any American with a smartphone must interact with these giants, and when the President frequently announces major US news, including foreign policy, from his social media accounts, questions about how these companies operate and provide the information we use to shop, connect, organize, and decide how to vote are incredibly important. These questions may also impact decisions like what to do about TikTok, a Chinese-owned social media service which vacuums up user data and has US officials concerned about national security. Most Americans believe that the gigantic tech megafirms have too much control over their lives and that reforms are needed. One can only hope that Congress steps up its game and becomes more fluent on these gravely important issues. Particularly embarrassing moments include representatives grilling the CEO of the wrong company about a smartphone question, and one congressman asking Google CEO Sundar Pichai why his campaign emails were going to his father’s spam folder. Facing an industry that evolves as rapidly as this one, and one that reaches into Americans’ daily movements, personal and professional lives, and ultimately our democracy and national security, our leadership must be prepared to protect Americans while not strangling American ingenuity and technology primacy.
The views expressed above are solely the author's and are not endorsed by the Virginia Policy Review, The Frank Batten School of Leadership and Public Policy, or the University of Virginia. Although this organization has members who are University of Virginia students and may have University employees associated or engaged in its activities and affairs, the organization is not a part of or an agency of the University. It is a separate and independent organization which is responsible for and manages its own activities and affairs. The University does not direct, supervise or control the organization and is not responsible for the organization’s contracts, acts, or omissions.
Imagine for a brief moment: there is a panel of six Supreme Court Justices on stage at Harvard Law School; they are wearing smiling faces, ready to answer a variety of questions. The panel host begins, “So we are going to start, as we should, with question one.” Laughter follows, and even the Justices laugh. Elena Kagan, after a chuckle, “good idea.” Yes, Supreme Court Justices laugh too. Most of that panel at Harvard Law School was filled with humor and jokes while reflecting on a life in the law. Yet, we rarely see this side of the Court, mostly because many Americans would not set aside the almost two hours to do so. The current politicization of the nomination process has infiltrated into the public’s perception of the high court. According to a 2019 poll, over two-thirds of Americans trust the Supreme Court to operate in the best interests of Americans. About half of Americans, however, believe that the Supreme Court Justices do not set aside their personal beliefs when deciding cases. In the same poll, Americans were divided on the idea of restricting the independence of the Court; respondents said that the Court should listen more to the will of people. This is concerning. As the American public has witnessed, the nomination process of the past two decades has become increasingly polarizing. Before the nomination and subsequent rejection of Robert Bork, it was not uncommon for a confirmed Justice to receive 80 plus Senate votes. Remarkably, the Court’s conservative icon, the late Justice Antonin Scalia, was confirmed by the Senate 98-0. So, where do we go from here? Let’s start with the confirmation process. It was not until President Richard Nixon that court appointments became an election issue. This phenomenon was exacerbated by the politicized Roe v. Wade case that protected women’s freedom to choose to have an abortion. Republican nominees were supposed to overturn Roe while Democratic appointees were to uphold it. Later on, candidates in the 2016 presidential election campaigned on filling the late Justice Scalia’s seat. The 2016 RNC and DNC platforms both called into question the fate of Roe and Obergefell v. Hodges, which upheld same-sex marriage. “How can it possibly be that in a functioning democracy anyone should think that the most important issue in a national election was the composition of the unelected judiciary?” opined the late Justice Scalia, rather ironically. More recently, Senate Minority Leader Chuck Schumer (D-NY) threatened the Court and specific Justices: “I want to tell you, Gorsuch; I want to tell you, Kavanaugh: You have released the whirlwind, and you will pay the price. You won’t know what hit you if you go forward with these awful decisions.” To circle back to the confirmation process, politics inherently slips into the equation. Both parties play the game of trying to pin the judge into a tight corner of committing to a court outcome or past case. But where does that lead us? Pressing for a stance on a hypothetical issue that may come before the court violates the notion of an impartial judiciary. Of course, judges have judicial philosophies. And while philosophies blend well with political parties, it does not mean judges serve on the bench to advance their own policy preferences. It is a Justice’s jurisprudence in which they operate under. Of course, it is difficult to separate Republicans and conservative judges, Democrats and liberal judges. But we must remember that every case that comes before the Court is interpreted based on formulated judicial philosophy, not political affiliation. We can attribute Democratic court successes to liberal justices, and likewise on the right. But we should understand legal reasoning first. For conservative justices, it is about understanding jurisdiction, process and authority; for liberal justices, it is about seeing a constitution that should evolve with the times. So public discontent surrounding the Supreme Court and nominees should be pointed towards the legislature, which writes laws and faces the public at the ballot box every two or six years. Judges and justices serve with lifetime appointments to shield themselves from politics, to remain accountable to the Constitution, not the will of the people. The Federalist Papers #78 speaks to this: “the judiciary…has no influence over either the sword or the purse; no direction either of the strength or of the wealth of the society; and can take no active resolution whatever.” The Papers continue, “It can be of no weight to say that the courts…may substitute their own pleasure to the constitutional intentions of the legislature. This might as well happen in the case of two contradictory statutes; or it might as well happen in every adjudication upon any single statute. The courts must declare the sense of the law; and if they should be disposed to exercise will instead of judgment, the consequence would equally be the substitution of their pleasure to that of the legislative body. The observation, if it prove anything, would prove that there ought to be no judges distinct from that body.” When Americans, or politicians, politicize the courts, they misguide their critique. Policy deliberation belongs in the legislature, not the courts. The public does not get to vote on judges, so the public should not view judges as politicians who hide behind their robes.
The views expressed above are solely the author's and are not endorsed by the Virginia Policy Review, The Frank Batten School of Leadership and Public Policy, or the University of Virginia. Although this organization has members who are University of Virginia students and may have University employees associated or engaged in its activities and affairs, the organization is not a part of or an agency of the University. It is a separate and independent organization which is responsible for and manages its own activities and affairs. The University does not direct, supervise or control the organization and is not responsible for the organization’s contracts, acts, or omissions.
 In the Southern Caucasus, the sparsely populated 1,700 square mile region of Nagorno-Karabakh may soon be the flashpoint in a larger regional conflict involving Russia and Turkey. While Armenian and Azerbaijani soldiers and civilians die in the rugged territory, Turkish-backed Syrian fighters and Israeli drones flow into Azerbaijan. Meanwhile, Russia sells arms to both sides to keep a level playing field and preserve its relationships with the two countries. The conflict over Nagorno-Karabakh is complicated not only for its mesh of international involvements, but more importantly because of its ethnic and religious roots. Despite being part of Azerbaijan, the regional population has a strong Armenian and Orthodox Christian majority. Greater Azerbaijan is nearly homogenously ethnic Azerbaijani and Muslim. Unsurprisingly, international alliances have fallen along the same lines—Turkey consistently backs Muslim Azerbaijan over Christian Armenia, while Orthodox Russia aligns itself closely with Armenia. However, Russia has also worked to maintain a good relationship with Azerbaijan. Russia and Turkey are not new adversaries in the modern age; the countries have backed different groups in the internal conflicts of Syria and Libya, but the two countries now tread on the brink of open war by involving themselves in Nagorno-Karabakh. As a member of the Collective Security Treaty Organization (CSTO), Russia may rightfully come to Armenia’s defense against Azerbaijan. Likewise, aggressive actions by Armenia or Russia against Turkey could result in Turkey’s invocation of Article 5 of the North Atlantic Treaty, which treats an attack on any single member of the alliance as an attack against them all and calls for collective defense measures. The war has raged on steadily for over a month, and thus far any agreed-upon cease-fire or truce has been broken within hours by Armenia or Azerbaijan. The first, negotiated by Russia, was broken within hours of its agreement on October 10. A second, orchestrated primarily by France, was ineffective within hours of going into effect on October 18. Analysts widely believe Azerbaijan will continue its offensive until the region is fully occupied. Such an occupation would be a gross violation of United Nations principles of self-determination for the people of Nagorno-Karabakh and would precipitate a massive humanitarian crisis, or worse, for those living in the region. For the United States and the United Nations, the options are clear. Either the conflict can be ignored, and the people of Nagorno-Karabakh forsaken, or concrete action can be taken. The U.S. and U.N. have sat on the sidelines of a prolonged conflict rooted in ethno-religious tensions before—U.S. leaders and U.N. troops stood idly by while thousands of Bosnian Serbs were massacred between 1992 and 1995. The U.S.'s failure to intervene until 1995 led President Clinton to intervene early when tensions flared again in the Balkans, this time in Kosovo in 1998. Such lessons must be applied in 2020 to the Nagorno-Karabakh conflict. Arguably, Nagorno-Karabakh’s location in the Caucasus makes it far less important to United States interests than Eastern Europe was in the 1990s. Humanitarian concerns aside, it could be reasonably argued the U.S., and even the U.N., has no business establishing a presence in Nagorno-Karabakh. Indeed, this would undoubtedly be the position taken by President Trump and Secretary of State Mike Pompeo, whose attempts at mediating a meaningful peace have been lackluster at best. A continued failure of the United States to defend self-determination, however, sends entirely the wrong message to both American allies and enemies. If America is to come first, America must not appear weak globally. Already, the U.S. has suffered a serious loss of prestige in the region by deserting Kurdish soldiers fighting the Turks in Syria—the same soldiers who assisted the U.S. in defeating the Islamic State. The U.S.’s continued refusal to engage internationally undermines all the principles on which world organization and global relations stand. The United States must take charge within the United Nations Security Council and endorse a plan which would involve brokering a meaningful ceasefire and, after that ceasefire is achieved, the deployment of U.N. peacekeeping forces to Nagorno-Karabakh until the territorial dispute can be resolved. Moreover, this peacekeeping force must be given the authority to do more than simply watch the violence occur, lest failures like the United Nations Protection Force and the United Nations Assistance Mission for Rwanda occur again. This is a process which will take considerable time and effort, but it must be attempted and achieved if the spirit of global cooperation and self-determination is to survive. “America First” need not mean the United States bow out of all international commitments and conflicts. Rather, “America First” must be taken to mean American ideals will be applied internationally, as they have been in the past, to ensure continued prestige on the world stage.
The views expressed above are solely the author's and are not endorsed by the Virginia Policy Review, The Frank Batten School of Leadership and Public Policy, or the University of Virginia. Although this organization has members who are University of Virginia students and may have University employees associated or engaged in its activities and affairs, the organization is not a part of or an agency of the University. It is a separate and independent organization which is responsible for and manages its own activities and affairs. The University does not direct, supervise or control the organization and is not responsible for the organization’s contracts, acts, or omissions.
As the nation enters the final days before the election, President Donald Trump and former Vice President Joe Biden have promoted their respective tax policy plans as the better approach to help the American economy recover from the effects of the COVID-19 pandemic and directly support families and workers. President Trump has committed to continue building off of his administration’s 2017 tax bill, crediting the legislation for the economic growth in 2018 and 2019, where the unemployment rate fell to its lowest in half a century at 3.5%, In contrast, Democrats have argued that the tax bill has had little to no impact on economic growth, asserting that it does not do enough to support middle-income families and only helps corporations. The Biden campaign’s proposed plan would aim to increase taxes on corporations and the wealthiest Americans while providing relief to middle-class Americans by expanding federal programs and benefits. Tax Policy from Obama to Trump Under the Obama Administration, tax policy was largely driven by the need to rescue the economy from the 2009 financial crisis and implement stimulus measures. The top marginal corporate tax rate was 35%, one of the highest among members of the Organization for Economic Co-operation and Development (OECD), according to the Tax Foundation. Additionally, the average top tax rate on long-term capital gains was 23.8%, which included the taxes imposed by the Affordable Care Act (ACA). Other policies included tax hikes on high-income earners to ensure they paid a larger share than middle-income households. In response, Republicans argued that Obama’s tax policies left entrepreneurs and businesses worse off, stifling economic growth. As a result, President Trump led the effort to roll back Obama-era policies by working with a Republican-controlled Congress to rewrite the tax code and replace it with the Tax Cuts and Jobs Act of 2017 (TCJA). The bill reduced the top marginal corporate rate from 35% to 21% and cut the top tax rate on personal income from 39.6% to 37%. TCJA also allowed businesses to fully deduct the costs of new capital investments, providing significant relief to small businesses. Another provision established the Opportunity Zones (OZ) program to increase investment and create jobs in low-income communities. The historic tax overhaul narrowly passed the Senate with 51-48 votes along party lines, leading to ongoing criticism from Democrats. Assessing America’s Economic Success Since the enactment of TCJA, the White House has attributed the strong pre-pandemic American economy to the bill’s pro-growth reforms that provided more opportunities for workers across sectors and increased wages. The House Ways and Means Committee noted that the pre-pandemic economy’s unemployment rate dropped to one of the lowest levels in history and added 5 million jobs. Real disposable personal income per household also increased by nearly $6,000 since the enactment of TCJA. However, President Trump’s tax cuts are expected to add $1.9 trillion to the federal deficit, and ongoing trade wars over tariffs may impact growth in certain sectors, according to a 2019 Joint Economic Committee report. While the 2017 tax bill deserves credit for fueling economic growth, President Trump often asserts that he inherited a “disaster” from the Obama administration’s policies. As shown by data from the Bureau of Labor Statistics in the figure below, the economy was already making a steady recovery and trending upwards before President Trump took office. By the end of Obama’s second term, the unemployment rate had fallen to 4.7%. The average real Gross Domestic Product (GDP) growth was roughly similar to the rate seen under President Trump at 2.6%.   Overall, it is fair to conclude that Obama-era policies did help lead the American economy toward recovery and should not be characterized as a “disaster.” At the same time, the Republican tax bill did take adequate measures to build on that success by creating more access to capital, providing workers with more opportunities, and strengthening American manufacturing. Despite this historic success, the COVID-19 pandemic has presented a new economic challenge to overcome, as several businesses face the threat of permanent closure and consumer optimism remains uncertain due to a lack of more federal stimulus and an unstable job market. Throughout the 2020 campaign, President Trump and Democratic presidential candidate Biden have insisted that their respective plan is better equipped to lead the country out of recession. The Republican incumbent may hold an edge over his Democratic opponent on handling the economy, and American voters will have to choose between two different approaches as they confront the public health and economic crises. Recently released reports on the country’s economic performance in the third quarter indicate record growth, providing voters with their last major impression of this policy issue before the election. According to the Department of Commerce, the economy has recovered nearly 67% of the progress it lost from COVID-19. In addition, the country has recovered about 50% of the jobs lost from the shutdowns earlier this year. While the data reveals that the economy has made substantial progress in a short period of time, analysts estimate that GDP will contract 3.6% this year (when compared to the fourth quarter of 2019) and do not anticipate it will reach its pre-pandemic level until 2021. The figure to the left depicts the record GDP rebound seen in the third-quarter report. Feasibility to Implement and Potential Effects of Each Proposal The effects of the COVID-19 pandemic will likely continue impacting economic growth and jobs in 2021, underscoring the need to mitigate more potential damage by implementing a new vision for tax policy. Regardless of who wins the election, either a President Trump or President Biden will have to address TCJA provisions that are set to expire in 2022, which may drive some bipartisan negotiations. However, the feasibility of materializing either proposal into a reality will depend on the makeup of Congress. It is hard to envision a scenario where a White House and Congress from opposing parties can accomplish meaningful changes in business or individual taxation. During his Republican National Convention speech in August 2020, President Trump committed to broadening and expanding policies from TCJA and delivering on other priorities post-tax reform. He expressed support for extending the OZ program, which has helped develop economically disadvantaged areas and provided job opportunities for minorities. He has also called for more tax cuts to “boost take-home pay” for the middle-class and alluded to reducing the capital gains tax rate from its current 20% level. On incentives, President Trump has mentioned imposing a tariff on companies that do not move their operations to the mainland from overseas, in addition to creating a “Made in America” tax credit to encourage domestic production. In evaluating the impacts of tax policy under a Biden Administration, it is important to note that the post-election economic and political outlooks will serve as the driving factors for any changes to its proposed plan, especially if Republicans hold the Senate. As it stands, the former Vice President’s tax policies would raise tax revenue by about $4 trillion over the next 10 years. The primary sources of revenue could come from increasing the corporate tax rate to 28%, raising the top income rate to 39.6% for individuals earning income over $400,000, and capital gains taxes. These policies would be aimed at reducing income inequality, which will continue to be an area of focus for Democrats post-TCJA. Former Vice President Biden has also called for improving programs, such as the EITC and CTC, that provide much-needed relief for American families, especially as they weather the uncertainty of COVID-19. One notable similarity to the Trump tax plan is the call to establish a tax credit that would incentivize companies to revitalize domestic manufacturing. This seems to be an area of common ground for both parties, in an effort to counter China’s economic power. According to analysis by the Tax Foundation, the Biden plan would lower GDP growth by 1.62% over the long-term and lead to a 1.9% decrease in “after-tax income for all taxpayers on average.” However, the actual effects of either proposal are too difficult to predict as the nation continues to grapple with the effects of the pandemic. Congress would likely primarily focus on federal stimulus as its first policy item on the legislative agenda post-election. As noted earlier, both parties would also need to recalibrate their approaches to tax policy if the White House and Congress are split. Overall, current economic trends give President Trump the upper-hand in promoting his tax plan as the one to further heal the economy, but there are still several industries and workers who continue to struggle, and the Biden tax proposal does contain meaningful provisions that would help revitalize communities and provide families with financial support.
The views expressed above are solely the author's and are not endorsed by the Virginia Policy Review, The Frank Batten School of Leadership and Public Policy, or the University of Virginia. Although this organization has members who are University of Virginia students and may have University employees associated or engaged in its activities and affairs, the organization is not a part of or an agency of the University. It is a separate and independent organization which is responsible for and manages its own activities and affairs. The University does not direct, supervise or control the organization and is not responsible for the organization’s contracts, acts, or omissions.
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