Grand Strategy
In April of 2020, 20,000,000 people were thrown out of work due to the lockdowns, which will prove to be one of the biggest economic disaster the United States government ever imposed on its citizens. From the time that Pandemic began to the present, Republican states outperformed their Democratic counterparts when it came to lower unemployment and job creations. Regardless how you rated how Republican governors compared to their Democratic counterpart or whether you reviewed states that were controlled by one party, the results were the same, Republicans outperformed Democrats.
Among Republican governors, their states returned 102.91 of jobs lost from the pandemics and their Democratic counterpart returned 100.81 percentage of their jobs. Republicans’ governors made up 80 percent of the top ten states and 68 percent of states in the upper half of states in returning jobs from the pandemic. This reinforces the notion that GOP governors proved better at job creation. Eighty-five percent of Republican governors reached 100 percent or more of jobs returned versus only 58 percent of Democratic governors.
Then we looked at states where the Republicans controlled both the legislature and the governor seat to their Democratic counterpart, we saw similar results as Republican states returned 103.08 jobs from pandemics compared to 100.35 for Democrats. Eighty-seven percent of GOP states returned 100 percent or more compared to 53 percent for Democratic states. We did find that states that have mixed government outperformed states with Democrats control and slightly under GOP states. Seventy-five percent of mixed states returned 100 percent or more jobs from the pandemic and 102.31 percent jobs were returned.
We have found that in previous research that Republican states had lower unemployment than their Democratic counterpart in the December of 2022 and then we continued to follow up and so far, we have found Republican states with Republican governors or Republicans complete control of all levers of government have lower unemployment than their Democratic counterpart in the latest unemployment released by Department of Labor.
A Story of Eight States
How does Illinois, Pennsylvania, New York, and California compare to Florida, Georgia, Texas, and Ohio when it comes to job production and growth? These are the eight most populous states and four have Democratic governors and four have Republican governors. These states were similar in demographics and blue states do have an advantage as they have slightly more Asians who consistently have unemployment similar or lower than Whites and these states population was slightly younger.
What we found was that these GOP states outperformed their Democratic counterparts, and this matched national trend.
In December 2022, these GOP states had an average unemployment 3.4 percent versus 4.2 percent for Democrats states and in May of 2023, GOP states had an unemployment number 3.4 percent to Democrats 4.1 percent. One reason that GOP states outperformed their Democratic counterpart was that they opened earlier, and, in the winter of 2020, three of the four GOP states did not re-lockdown their economy and kept their schools open.
Another aspect is that all the GOP states by May 2023 replaced those jobs lost from the pandemic’s lockdown for an average of 104.94 percent jobs returned and only two of the four Democratic states recovered all those jobs and the average for those Democratic states was 100.23 percent. This simply demonstrated what we saw on a national average that GOP states outperformed their Democratic counterparts with lower unemployment and returned jobs quicker from the pandemic losses.
In 2022, these Republican states had 2.9 percent GDP growth compared to 2 percent for Democratic states. And in the first quarter of 2023, these four Republican states averaged GDP was 2.55 percent versus Democratic states at 1.15 percent.
Since 2020, these GOP states consistently outperformed their Democratic counterparts. Two of the four GOP states had lower unemployment than the national average, but all the Democratic states were above the national average. All the GOP states also were able to recover all their jobs from the pandemics whereas only two of the four Democratic states were able to do this. The lower unemployment simply supports why GOP states did recover all their jobs quicker.
Finally, these four GOP states had GDP growth more than double than their Democrats counterparts in the first quarter of 2023 and this is also reflective in the better jobs report. And this continued a trend from the previous four quarters in which the Republican states outperformed their Democrat counterpart by a third more in economic growth.
Florida vs California
A good piece in Brownstone Institute detailed how Florida outperformed California in all aspects from education, economics, and overall health care during the Pandemic. Brownstone researcher Josh Stevenson observed that having a job not only impact a person economic outlook but also their health as he observed, “The cost of destroying livelihoods has impacts on health and life expectancy.. This was well-established in Public Health yet was constantly ignored by lockdowners. Knowing that the lockdowns completely failed to prevent or even reduce Covid spread and mortality, it was clear by mid-2020 that there could only be net harm by adding economic hardship onto the already existing burden of the virus itself.”
Galvin Newsome views himself as the best governor when it comes to leading California through the pandemic and defended the Fauci’s narrative but the reality, the economic outlook of his state declined and many of his state citizens now live in Texas and Florida. There is a wealth of data showing the complete failure of the lockdowns. Josh Stevenson reported in his research that while Florida increased their overall employment from January 2020 by 3.2 percent, California remained 11.5 percent below their pre-pandemic levels. This is verified by other data as we found Florida along with GOP and southern states did a better job replacing their workforce from the lockdowns.
Casey Mulligan, Phil Kerpen and Steven Moore reviewed in a recent paper the metrics dealing with Health care, economic, and education, found Florida came in at sixth place compared to California ranking only forty-seven. Regardless of what Metrics you use, Florida outperformed California and Florida also outperformed New York.
Florida has 13 percent more population, so New York spends 2.24 times higher on a per capita basis and as Francis Menton of Manhattan contrarian observed, “The theory here must be that the extra spending improves the health outcomes of New York’s poor and other low-income residents. How can we measure that? Healthcare outcomes are subjective and often not subject to definitive metrics. But one thing that can be measured and directly compared is life expectancy. Surely, for almost 4.5 times the per capita state Medicaid spending as Florida, and with almost 40% of the population participating in the Medicaid program, New Yorkers must have demonstrably longer life expectancy than Floridians…In January 2023 the online pharmacy Nice RX came out with a study of life expectancy by state, using CDC data for the year 2020. And the results are New York 77.7 years; Florida 77.5 years. It is an almost imperceptible difference. This is beyond embarrassing.”
Menton also compared education spending and results as New York state pays out nearly 14,000 dollars per student compared to $8543 per student in Florida. Menton observed that “The summary is that Florida students did substantially better in two categories, New York students better in one category, and the fourth category was essentially a tie. For this, does New York pay double and more what Florida pays? Again, it is shocking…And dare I mention that, with the far lower spending, Florida gets along just fine without any income tax at all? All I can say is, it is no wonder that Florida continues to grow its population rapidly, while New York shrinks.”
I live in Iowa, and I hear the ads, but Ron DeSantis is not talking about this impressive record. He is not yet working to his strength, his stewardship of the economy during the Pandemic and getting children educated when the prevailing policy was to keep the school closed. He was an island of sanity and competence when others failed on both. The biggest weakness of Trump years was Trump’s handling of the pandemic as he allowed Dr. Fauci and Dr. Birks hijacked the management of the virus while undermining Trump administration with promoting the lockdown that ensured Trump political demise in the 2020 election. The one thing that Trump did right was to allow the federalist approach and because of this, many of those Republican states who opened the economy earlier provided the brunt of the economic growth that occurred in the second half of the 2020.
From May 2020 to December 2020, 1.5 million jobs per month were returned to the economy and this represented more than half of the jobs lost in the pandemic. It took Biden administration about two years to capture the rest of the jobs. Red States including Florida kept the economy afloat and led what economic recovery moving into 2021. This is the story that we do not hear, how Florida and other states including Iowa led the economic recovery while many Democratic states like California and New York preferred to close their economy and allow their people suffer to defeat Trump. DeSantis showed both competence and the wiliness to challenge the political establishment when they were obviously wrong and kept the economy going. DeSantis was right, the Democrats, the Deep State and even Trump proven wrong. Iowa followed his lead and Iowa also outperformed many Democratic states. That is one story that needs to be told. Competence in crisis.
The Final Battle
We are now in the final battle as a movement to identify what conservatism will be in the 21st century and be able to turn this nation around. The future of conservatism is to combine Trump populism with Reagan conservatism. The battle is between the populist conservatives and more traditional conservatives. Dominic Pino detailed this recently, “For decades, tax cuts have been at the center of the conservative economic agenda. But some on the right want to deprioritize them in favor of other economic goals. Senators Marco Rubio, Josh Hawley, J. D. Vance, and others talk of the need for a new Republican economic agenda focused on things such as industrial policy or social policy. The Trump administration sought to increase tariffs, and conservative defenders of protectionism are being more vocal…Tax cuts seem to irk some right-wing commentators. In May 2020, writing for the American Conservative, Michael Cuenco bemoaned the Tax Cuts and Jobs Act (TCJA), the 2017 tax-cut law that Donald Trump signed, and called for a “reformulation of fiscal policy along populist economic nationalist lines.” He wrote, “The reformist right should ask: is there any way to stand athwart the supply-side swamp yelling Stop?”
I made the case that the importance of supply side economy and that its definition must be expanded in my book, “Americas at the Abyss, will America survive?” I made the case that government spending must be controlled, regulations burden reduced, and supply side had to move beyond just tax cuts. Trump did two of three, reduce regulation and tax reduction which benefited most Americans. The result was continuation of the recovery and more importantly the middle class, minorities, and lower income saw their income increase. Economic growth matters but Trump failure to get government under control hurt his overall economic plan and the massive spending during the Covid pandemic along with the anti-growth lockdown hurt the economy in 2020 and ended Trump chances to win.
Pino noted that GOP governors are pursuing tax reductions and yet, they are conscious of making sure that they keep spending under control as not to repeat what Brownback did in Kansas, cut taxes but failed to cut spending accordingly. The new generation of governors are doing both while not just cutting taxes but trying to flatten taxes.
The United States is in the middle of the tax-reduction revolution on a state level and as Jared Walczak of Tax Foundation, observed, “The past three years have seen the largest wave of state-tax cuts in the modern era, certainly since income taxes were created over a century ago at the state level. We have seen more than half of the states with income taxes cut their top rates. We have seen trimming of rates in other taxes, including thirteen states with corporate-income-tax cuts, a couple of states with sales-tax cuts, and trimming other taxes as well.” And these states are enacting real tax reforms.
There are seven states that do not tax individual income including Alaska, Florida, Nevada, South Dakota, Tennessee, Texas, and Wyoming. New Hampshire taxes only interest and dividends but are phasing them out so there will be eight states no tax. Governor Burgum of North Dakota noted recent legislation in reducing taxes will move North Dakota toward a goal of no state income tax and Iowa Kim Reynolds is following a similar pattern. Mississippi Governor Tate Reeves attempted to be rid of the income tax, but the legislature chose a flat tax with reduction. Tax Foundation Walczak favored the legislature caution as he noted, “Some proposals have overreached, but lawmakers have either defeated those proposals or substantially curtailed them before enacting them,”
When Kim Reynolds did her tax reforms, these principles were considered as government spending were slowed while lowering the tax rates. Iowa house speaker pro tempore John Wills observed about the Reynolds reform “We were looking at being very cautious and being very conservative, I guess you could say, in our approach, so that if at any point the revenues weren’t coming in as projected, we could back it off. That is why the cuts are designed to step up over several years.” The state replaced its top rates 8.53% and nine brackets to 6% and four brackets and the different brackets will be eliminated each year until the 3.9% flat tax is reached, subject to revenue triggers. For many Midwestern Republicans do not want to copy is first Illinois and for many Iowan Republicans, they realized their top rates were higher than Illinois and that was a wake-up call. The second is to not copy the Kanas model for when Brownback signed huge tax cuts with the idea of boosting economic activity, but budgetary shortfalls occurred as tax revenues increases did not materialize, and budget shortfall occurs. This led to Democrat Laura Kelly to be elected in 2018 and re-elected in 2022. Republican politicians are taking a more caution approach and controlling government spending.
Which leads us to the future of the GOP as Republican governors are looking to control their budget and return money back to the taxpayers. As I mentioned in a previous piece, Florida has been providing essential services for one half the cost as Democratic states like New York and do not have a state income tax. For the GOP, the key will be combined the best of Reagan ideas with Trump populism which Trump did in his administration. A modest foreign policy combined with tax and regulation reduction were the hall mark of the Trump years and the Republican candidate who can combine these two principles and add spending restriction can win the White House.
References
Where Tax Cuts Are Hot | National Review
Florida vs California - by Tom Donelson/ F of F (substack.com)
Substack Home - Frontier of Freedom notes and research
Substack Home - Frontier of Freedom notes and research
Leaving blue paradise - by Tom Donelson/ F of F (substack.com)
Once Again, State Budget Time in New York And Florida — Manhattan Contrarian
America at the Abyss, Will America Survive by Tom Donelson