Why Is Trump Still Clobbering Harris on the Economy?

Despite the drubbing Trump took during the debate, he still holds a commanding 20 percent lead (55 to 35 percent) over Harris on the economy, according to the CNN post-debate poll. Democrats should be very concerned about this because economic issues are extremely salient in key swing states like Pennsylvania, Wisconsin, and Michigan.

But really, after watching Trump’s debate meltdown, how is it possible for any sane human to believe he has the capability to improve anything at all?

The problem isn’t Trump’s crumbling abilities, nor is it a sure thing that abortion will ‘trump’ the economy this cycle, as many Democratic strategists are counting on.

The problem is that a significant segment of the electorate views the Democrats as part of the corporate elite that has grabbed unfair advantages. About 70 percent of Americans say that our economy “unfairly favors the powerful interests.” That’s also what we hear from workers in our political economy classes. They consistently tell us that “corporate greed” is the culprit.

As professor Jedediah Britton-Purdy wrote in The New York Times, “Compared to Mr. Trump’s Republicans, the Democrats remain the party of protecting the system and making it work — the small-c conservative party of the liberal but comfortable coasts and other economic hubs.”

The problem is that a significant segment of the electorate views the Democrats as part of the corporate elite that has grabbed unfair advantages.

In a twisted, demented way, Trump looked every bit the mega-disrupter during the debate last Tuesday, as he flailed away at everyone and everything. He was the picture of disorder and decidedly not part of the established order.

However, shaking up the established order is what many voters want. About 15 percent of registered voters believe that the political and economic “system needs to be torn down entirely.” Another 55 percent believe “the system needs major changes.”

Harris and the Democrats try to address this anger through a myriad of reforms that do not come across as “major changes.” Investing in new jobs for the future is certainly admirable, but the billions in subsidies for the greedy corporations involved in every “public-private” infrastructure investment look like the same-old, same-old. Tax breaks for childcare and new business startups are important, but they aren’t major challenges to the established order. Going after oligopolistic price gouging is a start, but corporate mass layoffs and job insecurity are not mentioned.

Harris/Walz should be paying much closer attention to this: 70 percent of workers, right now, are preparing for job cuts, according to a MarketWatch survey.

There is a material basis for this fear. The Bureau of Labor Statistics reports that “from January 2021 through December 2023, there were 2.6 million workers displaced from jobs they held for at least three years.” And an additional 3.7 million with fewer than three years tenure lost their jobs “because their plant closed or moved, there was insufficient work for them to do, or their position or shift was abolished.” The research for my book, Wall Street’s War on Workers, found that more than 30 million workers have suffered through mass layoffs since 1996.

If the Democrats want to take back the economy from Trump, they must speak directly to the 70 percent who are worried about losing their jobs.

The economy for working people has fundamentally changed since the deregulation of Wall Street starting in the 1980s. Now, in good times and in bad, mass layoffs are common as corporations pour more and more money into their outrageous pay packages and stock buybacks for their Wall Street investors. (A stock buyback is when a corporation uses its money or borrowed funds to repurchase its own shares in the stock market. This raises its share price without adding any value at all to the company. Stock buybacks were considered illegal stock manipulation until their deregulation in1982. Please see Wall Street’s War on Workers for all the sordid details.)

In their 2024 platform, the Democrats waved at this problem by promising to raise the tax on stock buybacks from one percent to four percent. But that won’t put a dent in the more than $1 trillion in stock buybacks projected for 2025. Time and again those buybacks are funded by mass layoffs.

So why aren’t the Democrats attacking mass layoffs?

The problem is that most elected officials, including virtually all Republicans, really believe that layoffs are a natural law, like gravity, the result of market fluctuations, global trade, and new technologies. It’s all about unstoppable technological forces like A.I. and there’s nothing much that can be done except help create new jobs in the future. Those left behind will have to scramble. That’s the way of the world. That’s the basis for free enterprise, and that’s what freedom is all about. (Janis Joplin, thanks to Kris Kristofferson, cut through this BS: “Freedom’s just another word for nothing left to lose,” she sang.)

Why aren’t the Democrats attacking mass layoffs?

But that fatalism reflects how much politicians fear Wall Street. Already, we can see Harris back-peddle a bit on corporate taxes, and she’s facing pressure to tone down her proposed wealth tax. I’m sure the Democrats worry that if they attack stock buybacks and mass layoffs, Wall Street will cry Marxism! Socialism!

But if the Democrats want to take back the economy from Trump, they must speak directly to the 70 percent who are worried about losing their jobs.

For starters, they should re-read their 2020 Democratic Party platform, which said: “Taxpayer money should not be used to pay out dividends, fund stock buybacks, or give raises to executives.” Unfortunately, that plank only applied to Covid relief funds.

But, as I wrote here, it could easily be expanded to read: “No taxpayer money should be awarded to corporations that lay off taxpayers and conduct stock buybacks.”

Harris/Walz could pledge to add that one line to the $700 billion the federal government awards each year to corporations for goods and services. (It can probably be done without an act of Congress.)

When corporations scream that it will kill free enterprise if they can’t lay off workers, the response is simple. 1) If you don’t like the rule, don’t take the federal money. 2) If you still want to lay off workers, you can do so but those layoffs have to be voluntary, not compulsory. Use some of your lavish stock buyback funds to offer workers ample severance so that they voluntarily leave your firm, something that is often done for management employees.

Would corporations be willing to play by these rules?

Trump’s 2016 intervention in a Carrier air conditioning plant closing suggests they would. At that time, Carrier, under pressure from Trump, reversed its decision to move about 800 jobs to Mexico. Polling showed the intervention was wildly popular with the American people.

Why did the CEO give in? Why didn’t he scream about socialism and the collapse of the free enterprise system? Here’s what he said. “I was born at night, but it wasn’t last night. I also know that about 10 percent of our revenue comes from the U.S. government.” He was not about to bite the hand that feeds him.

Nor will Corporate America. They will not walk away from $700 billion in tax-payer money even if they have to abandon compulsory layoffs.

Calling for this rule would show that the Democrats are willing to disrupt the established corporate order and attack the unconscionable greed that is costing working people their livelihoods.