Note: If you are coming to HedgeyeLive this week, JT Taylor, Paul Glenchur and I will be talking about this and more)
Politics. Just because you are paranoid doesn’t mean people aren’t out to get you.
President Richard Nixon was definitely paranoid.
He had reason to be. Although the details are in dispute, historians generally agree there was some irregular behavior at ballot boxes in Chicago and parts of Texas during the 1960 race against John F. Kennedy. Did it affect the final outcome? That conclusion has been hotly debated with the consensus generally landing on “probably not.”
The most profound effect of the narrow loss was on President Nixon’s psyche.
Although he was well ahead in the polls heading into the 1972 election, inflation had plagued his domestic policy. The war in Vietnam was increasingly unpopular, interest rates were high but unemployment low.
The 1960 campaign had taught President Nixon to leave nothing to chance. Congress had given him the power to impose wage and price controls, so he did. He also, delinked the U.S. Dollar from gold and allowed it to float against other currencies. The purpose of these policies was to control inflation and neuter attacks from Democrats, whose response probably would not have been much different.
His efforts were ultimately rewarded with more inflation and the 1973 energy crisis. Economic conditions made him vulnerable when Congress started asking questions about the still mystifying break-in at the headquarters of the Democratic National Committee.
When it comes to political survival there is nothing new under the sun which is why we should all know better.
Policy. In an effort to get ahead of the drop-dead date imposed by the Congressional Review Act, the Biden administration issued a raft of new rules that are mostly designed to shore up the president’s base.
I say mostly because two, a ban on non-competes and the nursing home minimum staff rules have a history of policy development. The federal government has considered imposing minimum staffing standards for years. The effect of non-competes has also been a focus of policy-makers for quite some time.
These rules and one establishing a maximum operating margin for home care workers – which has a meager policy history – have the added benefit of being politically appealing to the Biden administration’s core constituencies.
The nursing home minimum staffing and the home care opex rules, in particular, fulfill the goal of increasing the ranks of organized labor, especially the Service Employees International Union. Organized labor – or at least its leadership – are valued supporters of President Biden.
Another proposed rule, one that would ban menthol cigarettes, has been delayed allegedly because it might offend black voters. That excuse is one of those things that, even if it might be accurate, you still shouldn’t say out loud.
Currying favor – or at least not offending - proves the point which is the executive function of the White House has been reduced to the status of a campaign committee.
Power. As President Nixon discovered shortly after his landslide victory in November 1972, winning can be losing. That history will undoubtedly repeat itself. The graveyard called inflation that President Biden is whistling past has not abated as many expected and will plague the next president and possibly the one after that.
As the recent rulemaking makes clear, the cure, massive deregulation across the entire economy, is not under consideration. Nor will it be in the event President Biden is re-elected. At least not initially.
Late in his first and only term, President Carter took up deregulation of the American transportation system which still today reaps benefits in the form of responsive supply chains and consumer satisfaction, among other things.
His party never forgave him especially in retrospect when President Ronald Regan played hardball with Air Traffic Controllers during their 1981 strike. But you do what you have to do when you political survival depends on it.
Have a great rest of your weekend.
Emily Evans
Managing Director – Health Policy
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(Politics, Policy & Power is published in the quiet of Sunday afternoon or holiday Monday and attempts to weave together the disparate forces shaping health care. It makes no attempt to defend or prosecute the views of any established political party or cause. Any conclusions to the contrary rest with the reader alone.)
