Life’s about to get a whole lot harder for good ol’ uncle Joe

With Covid cases soaring and midterms around the corner, Biden’s easy wins are all behind him and the clock is ticking on the Democrats’ grip.

Joe Biden during a town hall event in Ohio this week. Picture: AFP

The US faces the prospect of another lockdown and perhaps even a shutdown as the few months of normality the country has enjoyed this northern summer give way to a more uncertain autumn.

President Joe Biden lauded the first six months of his presidency in speeches this week, pointing to the “highest economic growth rate in nearly 40 years”, falling unemployment, and a vaccination level of adults near 70 per cent.

The next six months of the Biden presidency, though, will be more challenging.

The economy was always going to bounce back as restrictions came off, whoever was in office, and Covid-19 would fizzle out as summer approached and vaccine take-up soared.

His administration’s easy political wins are fading.

As the shine of a newly minted president wears off, Covid-19 cases are rising again around the country and the clock is ticking on the Democrats’ slenderest of grips on congress – and, with that, the ­opportunity for major reforms.

Threats to rein in the power of the big tech firms, which have helped the Democrats politically through donations and censorship, will need to bear some relationship with reality.

Once again, Covid-19 will dominate. On Thursday (local time), new Covid cases, nearly all of them the “highly transmissible” Delta variant, exceeded 46,300, more than 50 per cent higher than a week ago. Deaths and hospitalisations have increased by about 20 per cent over the week too.

Florida, Texas and Missouri, three big Republican states, account for about 40 per cent of the new cases. But if Britain is any guide, well into its third – albeit far less deadly – wave, cases will shortly explode across the US.

Floridians take to the streets in support of people in Cuba under pandemic restrictions. Picture: AFP

The American Paediatrics Association this week demanded mandatory masks for all children over the age of two everywhere, inside or outside, vaccinated or not.

A rocky week in financial markets shows serious people are taking the chance of another round of lockdowns seriously.

At the same time, the nonpartisan Congressional Budget Office warned the US government would run out of money “around October or November” unless congress votes to increase the federal debt ceiling beyond $US28.5 trillion.

A decade ago, a Republican congress almost caused the Obama administration to default, refusing to lift the ceiling beyond a now quaint $US14.5 trillion.

The US government’s fiscal position is far more dire now. In the next three months alone, only a little over half its $US1.55 trillion in spending is covered by revenue.

In the fiscal year ended June 30, the budget deficit was $US3 trillion, or 13.4 per cent of GDP, the second largest deficit since 1945.

Republican Senate leader Mitch McConnell this week said Republicans won’t vote to lift the debt ceiling, but neither side can harrumph about fiscal prudence these days.

Public debt and deficits barely matter politically, even to economists, so it’s more likely congress will oblige this time. After all, they increased the ceiling three times during the Trump administration, which did as much as any other administration to pump up public debt.

The centrepiece of Biden’s economic agenda, a $US1.2 trillion bipartisan infrastructure deal, hit its first legislative snag this week, failing a vote in the Senate. Apart from $US7.5bn for electric vehicle “infrastructure”, the money is slated for roads, ports, public utilities and transport. For it to pass, every Democrat and at least 10 Republican senators need to support it.

The White House wants to show it can work across the political divide, in contrast to the Trump administration. But as campaigns kick off for the 2022 congressional elections, fewer Republicans will see any benefit in giving the White House a win, even if the country needs it.

Meanwhile, a far more ambitious “infrastructure” bill championed by the far left parts of the Democratic Party is waiting in the wings. Drawn up a fortnight ago, worth around $US3.5 trillion and chock full of money for climate change, electric cars, free child and health care, it won’t attract an iota of support from Republicans.

However, the Democrats have the numbers to push it through without Republican support, using an obscure congressional process known as “reconciliation”, with the support of every single Democrat.

Once again, as time passes, Democrat politicians in the more conservative parts of the country will be less likely want to put their name to a plan being championed by Bernie Sanders and firebrand New York Congresswoman Alexandria Ocasio-Cortez.

It’s too early to say that Biden’s legislative agenda has failed. Trump didn’t pass his biggest ­reform, on tax, until the end of his first year in office.

Alexandria Ocasio-Cortez talks to the media. Picture: Getty

Washington DC is meanwhile consumed not only with congressional chess around infrastructure, but who will sit on a committee to investigate the origins of the January 6 storming of the Capitol building, and whether states have the right to set their own voting rules.

Ordinary Americans are more concerned with whether their children’s schools will teach in person again in September, and rising prices, which the President has conceded is a problem.

“You can’t flip the global economic light back on and not expect this to happen. As demand returns, there’s going to be global supply chain challenges,” he said this week. Consumer prices jumped 5.4 per cent over the year to June, the quickest in 13 years. Awkwardly, for a president who often stresses a goal of better-paid jobs, it has outstripped wages growth by around 2 percentage points.

For now, the smart money says the inflationary bout won’t last. ­Investors are still willing to lend to the US government for 10 years at 1.2 per cent interest, an even lower rate than a few months ago.

The Democrats will have to hope so as there is no guarantee wages will keep pace with consumer prices.

The avuncular, if increasingly absent-minded, Biden still enjoys positive approval ratings.

But it’s been in steady decline, despite a torrent of cash landing in American families’ bank accounts – $US300 or $US250 a month per child automatically – as part of Covid-19 stimulus payments that dwarf anything any other country has spent.

Those sugar hits won’t, and can’t, last. The bigger challenge for the President will be to engineer somehow a decline in the jobless rate back to where it was before the pandemic struck.

Almost 10 million people were unemployed in June, 3.6 million more than in February 2020. Covid-19 will pass, but the trillions in debt, and perhaps even the ­unemployment rate, might not.