Sunday, March 7, 2021

Economics & Politics; Back to the Future.

February 22, 2021 by  
Filed under Business, Money, News, Opinion, Politics, Weekly Columns

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( Although still settling in, President Biden and his administration have hit the ground running.  Focusing intensely on slowing down the spread of the coronavirus in order to bring back economic growth and general well-being.  The U.S. economy shrank by 3.5% last year and, for the first time since 1944, life expectancies fell among all ethnic groups; with black life expectancy dropping most by three years.

In the face of multiple crises, contours of the new administration are taking shape, characterized by the return of subject matter experts and straight-talk.  Two recent events demonstrate the modus operandi for how this administration intends to govern.

It’s not happening

During a CNN sponsored Town Hall, President Biden showed the candor and empathy he has come to be known for.  Answering a questioner who asked how he was going to make a proposed $50,000 reduction in student debt happen he responded, “I will not make it happen.”  During the campaign he had called for a $10,000 reduction in student debt and he did not attempt to pander to the audience.

When a mother rose to ask on behalf of her young daughter what can be done to overcome her fear of contracting COVID-19, Biden responded by explaining that COVID was rare in children and closed by addressing the little girl directly saying, “Don’t worry honey, you will be okay and mommy will too.”

By-the-way, there was no need for a “fact check” after.


Four pillars

Prominent mid-Atlantic law firm Ballard Spahr held a real estate webinar with a panel that included most of the major trade associations in the commercial real estate industry: The Mortgage Bankers Association, The Multifamily Housing Council, The Building Owners and Managers Association, The Real Estate Roundtable and The National Association of Real Estate Investment Trusts.

While some in the media may have expressed uncertainty about the direction of the new administration, these business leaders were very clear on what they called the “four pillars” of Biden’s strategy:  COVID relief, housing affordability, racial equity and climate change.  As someone who spent a career in the affordable housing business, I can tell you that I have never heard “racial equity” addressed as a major thrust of any new administration’s governing agenda, and with the industry’s acceptance.

We owe you nothing

Contrast that with what we have seen from the political leadership in Texas in the face of the crises caused by a winter storm.  First there was lying from the Governor that the problems were being caused by the Green New Deal; an idea that has not even been proposed in legislation, let alone become law.  Besides, Texas has its own electricity grid.  Then, Texas’ junior Senator, Ted Cruz, changed his story three times in 24 hours when he was caught abandoning his freezing constituents for sunny Cancun.

The Mayor of Colorado City, Texas probably best summed up his party’s governing philosophy when he told his residents fighting the cold, “The City and County and other public services owes you NOTHING.”  He followed with, “Only the strong survive.”  This is just the latest incarnation of Ronald Reagan’s [in]famous quote, “Government is not the solution to the problem, government is the problem.”  A dystopian vision of a dog-eat-dog society where the rich are celebrated and the needy castigated for their very neediness.

What comes next…

We now have a clear vision of what the two parties believe is the role of government, especially in a crisis.  One party seeks to face the problems head-on and ensure that government provides necessities for its citizens.  The other lies about the nature of the crisis, or doesn’t acknowledge it at all.  It believes it’s up to you to solve your own problems, and any pleas for government assistance are “socialism.”

The path forward has to be one where government provides a level playing field for all of its citizens.  Not guaranteeing equal outcomes, but equal opportunities.  The real argument is not about whether government is “big” or “small”, but rather is it effective.  Can it meet the basic needs of its people, especially in times of crises.

As we begin down the path being charted by the new administration, the 2022 and 2024 elections will determine what’s ahead.  House Speaker Nancy Pelosi offers sage advice, “Don’t agonize, organize.”

Staff Writer; Harry Sewell 

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