State of the race

Plus some thoughts on the economy

Two weeks ago, I referred to Tim Walz as a dark horse candidate to be picked for VP. On Tuesday, Kamala Harris picked him as her running mate. Things sure change fast. It turns out I was mispronouncing his name the whole time. It’s Walls, not Waltz.

A comprehensive look at how Harris made her pick can be found here. Ordinarily, the VP vetting and selection process lasts for many weeks. Time was of the essence and so the process had to be done much quicker than usual. Walz was one of the three finalists along with Josh Shapiro and Mark Kelly.

I think Walz is perfectly fine. He’s not going to make any electoral difference and that’s okay. VPs rarely make any difference outside of their home state and Minnesota isn’t a swing state. Had Shapiro or Kelly been picked, I would have been fine with that, too. On paper, they could have made a small difference in their home states of Pennsylvania and Arizona, but their presence on the ticket isn’t required to win either one of them.

In my last piece, I laid out what I think are most important considerations in picking a VP and it’s worth going over it again. The threshold question any pick should pass is whether they could take over as president and be ready to do the job. In Walz’s case, the answer is unequivocally yes.

He’s been the governor of Minnesota since 2018. Before that, he was a congressman from 2006-2018 and survived some tough races. His life before that is very fascinating and impressive. He served in the Army National Guard for 24 years and is the highest ranking enlisted soldier to serve in Congress. For some of that time, he was a high school history teacher and football coach where he led the team to a state championship.

While teaching and coaching, he helped form a gay-straight alliance club. This was at a high school in Mankato, Minnesota, which is a small city 80 miles from Minneapolis. Leading such a group in a predominantly rural place in the 1990s was not the most popular thing to do. During his first campaign for Congress in 2006, he openly supported gay marriage while running in a rural district long held by Republicans. He was way ahead of his time.

During his teaching career, he taught in China for a year and has made around 30 trips there. China has long been an interest of his and is something he has a very strong familiarity with. Given the importance of China and its rivalry with the US, that experience should come in handy.

As a congressman, his voting record was decidedly centrist. Since becoming governor, he has moved leftward along with the state. Republicans held the state senate for his first term, but that changed after 2022. The legislative session that followed was a Democrat’s dream come true. Legislation signed included expanding abortion and LGBT rights, creating a paid family leave program, legalizing marijuana, creating universal free school breakfast and lunch programs and clean energy legislation.

Those are all things I like, but what I like even more is that he gets the importance of cutting red tape. The clean energy legislation he signed is very ambitious, but the permitting rules in place guaranteed it wouldn’t happen. So the legislature passed and he signed a law cutting back on permitting time by 50%. On housing, Minneapolis has eliminated single family zoning, but NIMBYs sued to stop it. In response, the legislature passed and he signed a law exempting the city’s plan form environmental review. He has previously pushed to repeal the state’s ban on nuclear power.

Given all that, I have no doubt he could be president. I have no doubt Shapiro or Kelly could, too. Since they all satisfy the threshold question, the next question is how well they and Harris will get along. It’s hard to say for sure since she doesn’t have a long history with any of them. When meeting with each of them, Walz was the one who had the best chemistry with her and that factored into her decision. He was eager to be a team player and told her not to pick him if she didn’t think he’d help.

During their meeting, he said he had no presidential ambitions. I wouldn’t take that at face value and I doubt anyone on the Harris team did, but it’s still instructive. Running for president isn’t something on his mind right now. That could change, but for now it’s not his focus.

That helps to limit the problem of competing ambitions. That was the most obvious drawback with Shapiro. At 51, he would certainly be a future presidential candidate. I don’t blame him for that and it’s not necessarily bad. It can cause tensions, though, if his future ambitions conflict with whatever she wants to do as president. It wouldn’t be the first time that’s happened.

Walz will be 68 in 2032. That’s not prohibitively old, but it’s much older than most others who run for president. We have no idea what will be going on then, but we do know he will be 8 years older than he is now and there will probably be many others eager to run who are younger than that. It wouldn’t be a surprise if he takes a pass.

As for how helpful he will be in getting her agenda enacted, that, too, is hard to know. Of the three finalists, though, he looks like he could be the most likely to help out. That’s just a guess, but I’m basing it on his time in the House. He has the most DC experience of the three and was well-liked when he was in Congress. That’s not a magic bullet, but it is helpful.

I was somewhat surprised by Walz being picked. I didn’t have any inside information, but it seemed like Shapiro had the edge. As I wrote about in my last piece, I like Roy Cooper and preferred him, but he quickly took himself out of the running and was never vetted. I don’t know why he bowed out and I don’t buy his stated reason for it. Maybe he just wasn’t interested in it. Hopefully, he runs for senator in 2026.

Whatever one’s opinion of Walz being picked, we all have to remember that we weren’t privy to any of the vetting that went on. I preferred Shapiro, but that was just a gut feeling. I have no idea how any of the vetting went other than what I read from the same sources everyone else has access to. The same is true for any pundit or commentator out there. Maybe Shapiro and Kelly had skeletons in their closet. Maybe Harris liked all three and just decided she liked Walz ever so slightly the best. We just don’t know.

All in all, I think Walz is very good. On the criteria that matter, he passes the test, at least based on what is known about him now. On a personal level, he seems like as normal of a person as there is. I think the vibes he gives off are great. It’s hard to beat a football coach, history teacher and soldier who is folksy, warm and fuzzy.

For those worried about Walz because the left-wing of the party wanted him to be picked, don’t be. That crowd picked him completely by default. They have no love for him, they just liked Shapiro and Kelly less. His voting record on Israel and his rhetoric on it are lightyears away from what the left wants. Not only that, he wrote his master’s thesis on Holocaust education and as governor signed legislation requiring it to be taught in middle and high schools.

Trump is flailing and Harris is thriving, but don’t expect it to last

Things have changed dramatically since Biden bowed out on July 21. From June 27 until then, Trump looked like he was going to coast back to the White House. Since July 21, things have gone very badly for him. He has struggled to find an effective attack against Harris and has stepped on rakes in trying to do so.

Last week, he attended the annual meeting of the National Association of Black Journalists. His interview wound up being cut short when he went off the rails. Most notably, he said Harris wasn’t black and that’s what got all the attention. Afterwards, he proceeded to double and triple down on it despite pleas from Republicans to stop.

I’m glad he went to that event. Plenty of left-wingers online complained about him getting a platform, but they don’t get it. Giving him a platform is good. We should all hope he gets more opportunities to run his mouth. Between that event and his “press conference” on Thursday, it was a greatest hits of reminding people why they don’t like him. The more he talks, the less likely he is to win.

If he talked about inflation and immigration, he might have some strong points to make against Harris. Doing that would require discipline and staying on message, which he is incapable of. Even when he talks about those issues, he quickly pivots back to his usual airing of grievances and hurling insults. That’s just who he is. Not doing those things would require him to alter his DNA.

It’s impossible not to notice the contrast in campaigning. Since making her VP selection, Harris and Walz have gone to Pennsylvania, Michigan, Wisconsin, Arizona and Nevada. Were it not for Hurricane Debby, they would have gone to Georgia and North Carolina, too. Trump did one event the entire week in Montana. His schedule for this month is very light and is a far cry from 2016.

With Biden in, that didn’t matter because he wasn’t able to campaign very much either. Harris and Walz are both able to campaign vigorously and visit multiple states in a short time. So far, every rally they have had has been packed. At their rally in Phoenix on Friday, more than 15,000 were there, many of whom waited outside for hours to get in.

Having large rallies by itself isn’t any kind of signal about who will win. Those who go to rallies and are willing to wait in line for hours to get in are highly unlikely to be swing voters. What having big crowds does is give candidates positive earned media coverage. That refers to airtime that is not paid for, FYI. It’s usually good for a candidate to have a rally and for it to be covered on the local news.

In the case of Trump, his opponent having big rallies is an unwelcome development. He has never run against a candidate who outdoes him on that front. Big crowds have always been an obsession of his and Harris attracting more people is irritating him. His obsession with crowds is what got him the most attention on Thursday when he said the mob that showed up on January 6 was bigger than the March on Washington. If Harris keeps attracting bigger crowds, odds are it will get him to say something awful and get bad media coverage for it.

Not only have things changed very fast, but what I and most everyone thought about Harris has turned out to be wrong. She is attracting huge crowds and a passionate following. Democratic voters are very happy having her as their standard bearer. Her favorable rating has substantially improved. Online, she has proven to be a huge hit and the subject of all kinds of memes.

Unlike Trump, her campaign has been very upbeat and joyful. She and Walz attack Trump plenty, but also have plenty of positive things to say. At their rallies, there have been chants of “USA!”, which I love to hear. I love the talk of patriotism and the things that make this country great. It’s a big and welcome contrast with the bleak worldviews of MAGA and the far-left.

So far, she has been doing almost everything right. I don’t know how her campaign roll out could have gone better. I expect the momentum and positive vibes to last at least through the convention next week.

All the good things notwithstanding, the race is far from over. It’s a very different race from before July 21, but a lot can and will happen between now and election day. If the narrative can go from Trump the juggernaut to Harris the invincible in three weeks, it can reverse just as quickly. Sooner or later, Harris will have a bad news cycle. I don’t know what will cause it, but it will happen.

It’s not a conspiracy, but it’s in the interest of political reporters, writers, pundits and others to have narratives shift frequently. I’m sure it’s been great for ratings and subscriptions to have the race shaken up. It certainly has provided plenty of things to talk about. The problem is each new narrative eventually becomes the old narrative and gets boring.

Those who report on, write and talk about politics for a living tend to have a low threshold for boredom. Things that are shiny and new quickly become stale. Constant stimulation is needed. The narrative of Trump struggling and Harris surging is cool now, but it will get tiresome and something will change it. Then again, there is a case to be made that it doesn’t happen this time given the unique circumstances.

As for normal people, who will pick the winner, very few of them are paying attention to the race now and they won’t until at least after Labor Day. Harris has had a great few weeks, but she has a lot of work to do. Her job is still to define herself positively before Republicans define her negatively.

The good news is she has plenty of opportunity to do that. Her campaign has raised an obscene amount of money and can afford to flood the airwaves in every swing state. Attacking Trump is fine, but the key will be selling herself and her vision. Views of Trump at this point are very hardened. Everyone knows who he is and how he acts. Harris’ name is well-known, but on most everything else she’s a blank slate.

I hope the Harris campaign spends a lot more money on positive ads than attacking Trump. It’s probably not enough to just say he’s bad. She has to convince people that she’s good and to refute the idea that she’s way out in left-field. That doesn’t mean going into right-field, just emphasizing standard issues such as healthcare, Social Security and housing costs and taking generic Democratic positions on them. The only issue where moving explicitly rightward on is good is immigration, which, to her credit, she looks to be doing.

The state of the economy

Pivoting to a different, but not unrelated topic, the economy is something I haven’t written about in a while so I thought I’d do a little of it here. We’ve reached an inflection point when it comes to the Fed’s dual mission. Interest rates have been held steady at over 5% for a year now while inflation has come down to a tolerable level of roughly 2.5-3%.

As best I can tell, most observers think it’s time to cut interest rates. I’m no authority on anything having to do with the economy, especially monetary policy, but there are many out there who I respect who believe it’s time to cut so I will defer to them. Last month’s jobs report was underwhelming and that has prompted many to advocate for interest rate cuts, arguing that the risk has now changed from inflation rising to unemployment rising.

Looking at the economy from an amateurish viewpoint, high borrowing costs are the only obvious big headwind I can see. That’s good because the solution to it is obvious: cut interest rates. That’s something the Fed can do and can do it quickly if necessary. The next Fed meeting won’t be until the middle of September where interest rates will almost certainly be cut, the only question is whether it’s ¼ or ½ a point.

After the underwhelming jobs report and the stock market selloff that followed on Monday, there were calls by some to have an emergency Fed meeting to lower interest rates. That would have been an extraordinary move. The only time that has happened is when the economy was facing a full blown crisis, i.e., 2008 and 2020. After the weekly jobless claims report came in better than expected and the stock market selloff reversed, those calls seem to have gone away for now.

Unemployment has gone up over the last year and is currently at 4.3%. I certainly understand the need to worry more about it compared to just a short while ago. It does seem clear that the economy has softened and overall demand is lower. The jobs report for this month will be key in determining what the Fed will do. The annual central bankers gathering in Jackson Hole is coming up soon. It’s always paid attention to, but may be even more so this time as Jay Powell will have a chance to send signals about where interest rates are headed.

While I’m no authority on monetary policy, I’m a big fan of Powell and think he’s done a great job. I have been singing his praises for years. He has done more than any single person to disprove what was thought to be a law of physics. He has successfully brought down inflation while not causing a recession. That was something virtually everyone thought couldn’t happen.

The only remaining task Powell has is to bring down interest rates before they start to take a big toll. I believe he can do it. He helped get us through a pandemic and did more than anyone else to stop another financial crisis from happening. He made some mistakes with inflation, but has since course corrected and gotten things right while proving his detractors wrong.