What The Debt Ceiling And George Santos's Career Have In Common
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Hello, and welcome to the FiveThirtyEight Politics Podcast. I'm Galen Druk. We knew from the start that Republicans' five-seat majority in the House would prove challenging for Speaker Kevin McCarthy, and last week showed the diversity of challenges he'll be faced with, from what to do with a swing district fabulist to the prospect of the United States defaulting on its death. Galen, my God. This has been a...

A window into your soul. Oh, f*** me. I'm sorry. Gonna do that over again. Thank God we don't do this live. What would that even mean? What would that even book for? America wants to see that. Okay. Okay.

Hello and welcome to the FiveThirtyEight Politics Podcast. I'm Galen Druk. We knew from the start that Republicans' five-seat majority in the House would prove challenging for Speaker Kevin McCarthy, and last week showed the diversity of challenges he'll be faced with, from what to do with a swing district fabulist to the prospect of the United States defaulting on its debt.

On Thursday, the country hit its debt limit, beginning a countdown until sometime in the middle of this year when the government can no longer fund itself or pay its debts. And throughout last week, new evidence of Republican congressman from New York, George Santos' lies surfaced. The New York Times reported that although Santos said his mother was in the World Trade Center on 9-11, she was not actually in the U.S. at the time.

And although he insisted that he had never been a drag queen, as a representative from a party that has questioned the morality of drag queens, well, just watch the videos. We're going to talk about all that, and we're also going to look at the decline of unions. Although unions have notched some high-profile wins recently, according to new data from the Bureau of Labor Statistics, the percentage of union jobs in the U.S. hit an all-time low last year.

It sounds dramatic, but really almost any of the past 40 years also holds that distinction. So what does declining unions mean for American politics? Here with me to discuss is Editor-in-Chief Nate Silver. Hey, Nate. Hey, everybody. Also here with us is senior writer Amelia Thompson-DeVoe. Hey, Amelia. Hey, Galen. And senior elections analyst Nathaniel Rakich. Hey, Nathaniel. Hey, Galen. Good morning. How are you?

I'm doing fantastic, and I can tell by your cheery voice that you're also doing well. So well. Yes, I'm here with you. I'm here with Amelia and Nate. Everything is great. That's some strong Monday energy, guys. I know. Well, this has been like an ongoing joke now with Nathaniel since the new year because I criticized him for sounding too dreary on one of the last podcasts of 2022. So now he's just like bright and cheery all the time. Whole new year, whole new me. Nathaniel, don't let Galen bully you. What?

Don't get into bullies. I'm bullying him by being aggressive. Yeah, he's making, he's, this is like his subtle, uh, dig at my perma cheeriness on this podcast.

Okay, and let's take all that cheeriness and channel it towards the debt limit, which is the cap on how much the US government can borrow. This is, of course, different from the 2023 federal budget, which Congress passed and Biden signed during the lame duck session in December. So the government has already committed to what it plans to spend in 2023, which is $1.66 trillion. Now,

But in doing so, it will breach the overall limit on the amount of debt that the U.S. government can take on, which is currently $31.4 trillion. If those numbers actually mean anything to you conceptually, congratulations. If Congress does not raise the debt limit as it has done regularly, the country will either default on its debt or not be able to pay for its operations or both.

So I know that we aren't an econ podcast, but Nate, kick us off. What are the consequences of breaching the debt limit for Americans? I mean, if we actually have a default, as opposed to the White House finding anyone of various creative means to avoid a default, and we can talk about those in a minute.

The main consequence is that it becomes much more expensive to borrow money going forward. That would increase interest rates, which are already on the rise. It would tank the stock market because now it's much more expensive to invest in the future. It would be at least a medium-sized fiscal crisis, maybe a massive fiscal crisis, but lots of downside outcomes.

Well, I mean, I think it's worth pointing out that even coming close to this cliff, like even seeming like it's possible that the U.S. will default has economic implications. If we look back at when there was a similar fight in 2011, stock prices fell. They didn't recover for months. The S&P 500 fell nearly 17 percent between July 22nd and August 8th, which was when the debt ceiling impasse was happening.

So, you know, it's not just what happens if we go over the cliff. It's what happens if it seems like there is a good possibility we will, which, you know, with our political situation right now, it is very easy to imagine us getting into that position.

Yeah, as you noted, Amelia, there's been plenty of brinkmanship on this in the past. And in the past, the parties have always come to some sort of agreement that has prevented the United States from defaulting on its debt. Should we assume that past is prologue and that it might be messy and we might come close, but that the sort of catastrophic situation that Nate described will ultimately be avoided?

I am less sure about that than I have been in the past, right? I would like to believe that, uh, you know, our government will come together and, and avoid this, you know, medium to catastrophic, uh, fiscal disaster. But I think the, the key difference, right, is just the narrowness of Republicans majority in the house. And you've kind of have, I think for the first time, um,

One of the parties, you know, who is in control of one of these kind of, you know, the president and the Senate and the House, kind of the debt ceiling limit needs to be passed through. One of those parties kind of doesn't have a majority hold on debt.

wanting to, to, to raise the debt ceiling, at least without some, some serious, um, changes to spending and things like that. And so it's going to be very hard because Kevin McCarthy can only afford to lose a few Republican votes. Uh, and of course, through his, uh, speaker election, he gave up a good amount of power, like for example, on the house rules committee, um, which is a powerful committee that determines which bills make the floor. Um,

you know, the Freedom Caucus and kind of the other kind of hard right types who are very insistent on we have to cut spending and we are going to hold firm and fight on this issue and not compromise. Those people have more power than they have in any of the fights in the past. And they had a good amount of power in 2011, you know, after the Tea Party wave and things like that. So, you know, it could definitely get messy. And, you know, I think there are people who are

willing in the Freedom Caucus to allow a debt default if they don't get what they want.

This is also, though, slightly different from the speakership vote, because, you know, Kevin McCarthy was only ever going to get Republicans to vote for him to become speaker. But in this situation, I mean, a workaround from relying on Freedom Caucus holdouts is just working with Democrats. So shouldn't this in some ways be more straightforward than the sort of chaos of the week of speakership votes?

Right. I mean, that's the thing, right, is that because of the narrowness of the majority, you know, you've got a good chunk of Democrats sitting right there. And theoretically, only a few Republicans need to join with Democrats in order to raise the debt ceiling. But of course, the issue for Kevin McCarthy there is political, right? He also one of the things he gave up in the speaker election is that any one member of the

of the Republican caucus can basically call for a vote of no confidence in his leadership. And if he does that, he may be saving the country from a debt default, but he'll effectively be giving Democrats control of Congress again, at least on this one issue. And that I think will be seen as an unforgivable sin by Democrats

most Republicans, I think, not even just the Freedom Caucus. And so it may very well be the end of his speakership if he were to do that. So he has this needle to thread where, you know, he needs to convince some combination of Freedom Caucusers and or Democrats to kind of go along with a compromise solution on this. And there just may not be that overlap between those two camps, obviously.

You have the added complication, too, of the Biden administration at least coming into this saying, no negotiation, we just want a clean deal. And that seems like it's responding, at least in part, to what happened in 2011, which was the way that the two parties got past the impasse was they agreed to essentially impose a series of large and

mandatory budget cuts if they couldn't work it out later, which surprise, surprise, they couldn't. Sequestration wasn't going to say the word because it's long, but you went for it, Galen. Thank you. Anyway, so, you know, that resulted in large spending cuts to defense spending, environmental programs, housing programs, education. You know, Democrats are definitely

remembering how that went down. And so although obviously, you know, we're at the beginning of a negotiation, and these are just the positions that that folks are taking at the outset, the fact that Democrats are not, at least the Biden administration is not coming into this signaling any willingness to consider concessions, I think is also relevant.

Okay, so Nathaniel and Amelia, it seems like you're a little more skeptical of the party's ability to reach an agreement this time around. Nate, I'm curious your take on this. And you also mentioned some inventive ways that the White House could create a workaround

How do you like do you think that this is more of a sort of? potentially catastrophic situation than 2011 because we should remember like 2011 actually came really close wasn't it hours they were we're hours away from defaulting on the debt by the time an agreement was reached I mean in negotiations that involve brinkmanship the amount of time that passes isn't necessarily like actually like a good indication of how close you were right because by definition

It's going to be solved at the last minute. It doesn't necessarily mean that it was all that much in doubt sometimes. Okay, I appreciate that. Currently, you can buy credit default swaps, which pay you out if the U.S. defaults on its debt. And the employer's about a 0.3 or 0.4% chance of a default. So maybe you should buy some.

If you think that the Congress is not, I'm not being sarcastic because they're going to be big financial consequences. If, um, you know, if you are investing in anything or, you know, uh, maybe you should hedge by buying some credit default swaps. So yeah, the answer is if you're stressed out about this, buy some credit default swaps, a word that I don't think I've like said in public since like 2012, but, um, yeah, it'll make it, it'll help you sleep easy at night. And you know, if the worst happens, you'll make some money.

So there are various proposed workarounds to the Biden administration, right? One kind of famous one is to issue a trillion dollar coin. The Treasury is allowed to mint commemorative coins. And if it printed this, minted this coin and then sold it to the Federal Reserve, then in theory that would solve the problem.

I think it's been dismissed by like Janet Yellen as being very gimmicky. Again, it's not here how the courts would rule, but,

There are solutions involving just saying, hey, the Constitution, we interpret the Constitution as saying the US can't default on its debt. So we're just going to move along like nothing happened, right? Then there are solutions involving issuing certain types of very, very high interest bonds that would create extra money. So it's, you know, there are workarounds. If push came to shove, I think the White House would say, we're going to do something instead of nothing.

But it kind of winds up in a situation where it's now litigated in court. And how you would expect the Supreme Court to rule, I don't know. Usually, the Supreme Court wants some degree of institutional stability. On the other hand, it's kind of a majority Republican appointed court, obviously, although not necessarily a majority sympathetic to like the Freedom Caucus types. So that gets to be a very...

Messy situation and and you know the markets trying to guess at how the courts would rule on these policies Again, probably better than the guaranteed defaults, right? Which is why maybe you shouldn't buy? Create default swaps, I guess right? But we get very ugly

Well, buying credit default swaps had a short life on this podcast. The idea of buying credit default swaps. This is our investment advice. Here's why you should do it. Here's why you shouldn't do it. I talked to a lot of people in finance. I think people in finance are often pretty clueless about American politics. I also think people in politics are often pretty clueless about economics. But like I wouldn't necessarily expect that to be super efficiently done.

Like the 0.3% chance. Got it. Okay. That's just being so low, right? If it's like 2%, that's still very low, but you have huge value in buying that credit default swap. So while we're sort of mired in the details of all of this, I should mention that one of the complicating factors is that we don't actually know the sort of drop dead date in terms of when the US would default on its defaults.

loans, in part also because the United States Treasury can make decisions about what it spends its money on. And so the Treasury could stop paying federal employees salaries, it could stop funding social programs, all kinds of things, and prioritize paying the debt if it wanted to. Part of this is going to be about what decisions the Treasury makes in doing all of this. So given that we don't have a date, how does this even... Because Nate, in order for Brinkmanship to work...

you kind of have to know when the brink is. Like, how does this all, how does this happen? Am I mistaken? Wouldn't there be a date announced when we get closer to it? Right? But is it just like, does Janet Yellen just pick the date? Janet Yellen will say, I think. I mean, she'll just say we're out of, because we're already using so-called extraordinary measures. Extraordinary measures. But I think they have to announce the dates at which they will need to take certain measures.

But I don't know if there's like if Janet Yellen is going to come out and say, like, we will default on this date. I think that's right. Because that's also her kind of playing chicken saying like, yeah, I'm going to make the like I'm going to make the U.S. default in favor of paying whatever other expenditure the U.S. might have.

Right. I don't remember this dimension of it from the previous fights, and maybe it was there and I just wasn't paying close enough attention. But it does seem to me, right, like if she, I don't know if it works this way in total transparency, but like if she says, you know, oh, like the date is June 14th, and then everybody is scrambling to June 14th, and then it turns out that she actually like...

overestimated by like three days. Like, you know, I do this sometimes and I'm like, you know, I'll meet you at five o'clock. Like, you know, knowing that like, Oh, I could probably get there at four 30, but like, you know, I'm probably gonna be a little bit late. So, um, I don't know. It's just like that guys. It's really making economics accessible. Um, okay. Back to the politics of all of this. Um, that was fun as a non econ podcast to engage in the economics of all of it. But like,

What do the parties want? I mean, I think we've said spending cuts on the Republican side and nothing, just a clean debt limit raise on the Democrat side. What spending exactly do Republicans want to cut? And is there anything that a sort of cohort of Democrats would be willing to make concessions on?

So I think the problem is that when you are talking about significant cuts, you have to start talking about entitlement cuts, at least if you're a Republican and you don't want to touch defense spending. Like the main other large pot of money that we're talking about are

Medicare, Medicaid, Social Security. So that's where a lot of the kind, or at least some of the tension among Republicans has been. The Republican Study Committee, which is a large group of House Republicans, released a budget plan in June that would basically tighten eligibility for Medicare and Social Security benefits.

And, you know, so that's something that at least some House Republicans at that time were willing to talk about. Then you have other leaders of the Republican Party, like former President Donald Trump, who are saying no to.

don't touch Medicare and Social Security. This is political suicide, basically. So that is going to have to be something Republicans talk about if they want to make significant cuts, because there just aren't many other places to go. Those are such a huge part of the federal budget.

Yeah, to put a number to this, in 2022, major entitlement programs, so Social Security, Medicare, Medicaid, Obamacare, and other health care programs consumed 49% of all federal spending. Okay, is there anything, so Republicans are currently torn between the sort of more populist vision of Trump's Republican Party, where Social Security and Medicare are untouchable. He said, like, don't, his quote was something like, you know, don't touch a penny of those programs.

And he sort of staked that claim early on in the process. And then there's other folks who I'm sure would love to cut, I mean, some of these other programs like Obamacare or parts of Medicaid, things that are not sort of like universal programs that are age dependent or whatever. What happens next? Like, are there any Democrats who might be interested in some of that? I mean, it's not a crazy, inherently crazy idea to cut spending, right? We do face higher interest rates.

rates now, and there's more of a consequence when you have higher interest rates to spending more than you bring in. You know, I think the Freedom Caucus types just want to create chaos and don't really give a s*** when it really does to the GOP's electoral prospects. I think the more establishment side of the GOP has a strong ideological commitment toward cutting government spending, but it's become less clear over the years, right? In some ways, like the kind of Paul Ryan republicanism

fiscally conservative, but pro-establishment was seen as the problem by a lot of Republicans, right? And it's been kind of discredited. And I think they've kind of like, the GOP has touched the third rail enough of entitlement cuts and been punished for it, including the 2018 midterms when efforts, it didn't get all that far, but efforts to overturn Obamacare did not help Republicans in that midterm, even though Obamacare had at one point been

So it's not kind of clear. It's not clear what they want exactly, right? I mean, I think Kevin McCarthy and all want to look like they're fighting the good fight and placating the base, right? I don't think they actually want like a default, although we can kind of get in the question of like, what would the political consequences be that can affect the theory of how the game's being played, so to speak? Well, I mean, since you brought it up, what do you think they are based on historical context?

So one theory that I think is oversimplified is that, well, the economy is bad, therefore it's bad for the incumbent party, meaning Biden and Democrats. Clearly there is a connection between economic performance and presidential re-election odds. We can debate whether that's somewhat strong or very strong. I'm more on the side that says it's somewhat strong, and some of the models that say it's very strong have technical flaws. But ignoring that for now, the question is, like, will the public parse out blame for

differently if it seemed like it's not a crisis of Biden's making. In particular, it seems like it's a crisis of GOP's making, right? That's a little bit hard to predict, right? Will they succeed in perpetuating the narrative that like the GOP blew the entire American and global economy up because of the irresponsibility?

They might, they might not. I don't know. I mean, I think it would depend in part on how the breach occurs. But yeah, the standard argument is that, hey, the GOP doesn't care if it's just going to hurt Biden's reelection. I think when you have deliberate kind of sabotage of the economy, it's kind of, there's not really a good precedent for how blame is apportioned. And it's also not a zero-sum game exactly, right? I mean, one answer is that

okay, it hurts incumbents of all kinds. So people want to throw Congress out and also throw Biden out. So, you know, it's not clear that it's necessarily in your narrow interest to have the country default if you're a Republican member of Congress. But it might be. It's, you know, maybe we're just that cynical and I don't know. Yeah, I completely agree, Nate. I think, you know, obviously we've never defaulted on our debt before, but kind of the situation that I see as analogous are like government shutdowns, which tend to have...

real tangible political impacts, but they're short lasting. This I feel like would probably be longer lasting because presumably the economic crisis that would be created would last longer. But you look at polling during past government shutdowns, and I think the public is actually pretty sophisticated in terms of being able to say who is to blame. So in the, I think it was 2019 government shutdown, the one that happened in the Trump administration, the long one, they blamed Trump because it was kind of

his insistence on building the border wall. In the 2013 government shutdown, they blamed the legislative side of things, which were also Republicans, but they were the kind of Freedom Caucus types who were, it was before the Freedom Caucus existed, but the Tea Party types who were trying to insist on cuts and defending Obama, defunding, not defending, Obamacare. And so kind of the public sided with the

recited against the side that was kind of making the demands, so to speak. And we're not just talking about sort of like sabotage in general. We're talking potentially about...

holding hostage programs that are incredibly popular. I mean, that's the thing about Social Security and Medicare. This is why they're called the third rail in politics, because people really, really like them. I looked up some numbers. A 2022 Data for Progress poll found that 90% of Americans want Social Security to exist 10 years from now. Basically, no differences by party affiliation on that.

And they're popular with older voters because, surprise, surprise, older voters rely on them. A 2021 AARP poll found that 85% of voters age 50 and older oppose reducing the deficit by cutting Social Security or Medicare. So those are really important voters for Republicans. And this is not an issue where there's ambiguity. People really like these programs. And so if the message is...

Some Republicans made the U.S. default on its debt, sending the country into an unprecedented economic crisis because they wanted to cut these programs that people really, really like. That's bad. That is a potentially very bad message for Republicans. Okay, so let's wrap up by frustrating this entire public opinion picture that we've just painted. A lot of P's there. Okay.

Yes, all of those programs are popular. But my final question is sort of like, what do Americans think about this? And when you look at YouGov polling, at least in December, turns out that when you ask them if the United States should raise the debt ceiling, Congress should raise the debt ceiling, 33% of Americans say that they should raise the debt ceiling. 28% say they're not sure. And 38%, the plurality, say Congress should not raise the debt ceiling.

So what is going on? I mean, bring in other polls if you have them, but also what is going on here? So what's going on here is that Americans don't really understand the debt ceiling issue, and that makes it something that's very susceptible to... But I thought you said they were so sophisticated. They understand political fights. I don't think they understand the kind of economic, like...

of the debt ceiling itself and like the fact like I think there's a misconception that it means like the budget you know that you're spending more but it's actually just offers yeah the budget too but like it's also like we've already committed to spending X amount of money and the debt limit just like gives us the permission to do that right it's not like actually spending more money people

think of it as kind of like a household budget. Sorry to interrupt, Nathaniel, but I think people think of it as like related to a household budget and kind of like increasing your budget when you can't pay for it, when really it's more like paying your credit card bill. Like you've already spent that money and this is about what happens if you suddenly decide that you don't want to pay your bill. And I mean, I found a poll, another YouGov poll from

January, were you going to... You were going to say this, Nathaniel, that... Well, I'll let you go ahead. No, you can do it. So, I mean, it found that...

When you ask people what they actually think is going on and why Congress has to periodically raise the debt limit, 25% of Americans think that it's to authorize new spending, which is not what it's for. And 42% say that it's to pay for new spending or to pay for spending that Congress has already authorized. And 33% aren't sure.

So this is something where less than half of Americans can correctly identify what is actually going on here. Well, and then so later on in the same poll, they did an interesting experiment where they asked half the sample a just straight up question where do you favor or oppose raising the debt limit?

And that had similar numbers to the ones that Galen cited. So 40% opposed, which was a plurality, and 28% favored it. But then they asked the other half of the sample kind of something with more context. And they said, to avoid defaulting on America's past debts and to continue paying Social Security benefits and military salaries without sparking a possible recession, Congress must soon raise the debt limit, just as bipartisan majorities have routinely done for the last century.

Do you favor or oppose raising the U.S. debt limit? And in that case, of course, not surprisingly, 45% favored raising the debt limit and 24% opposed it. Although notable that 24% of Americans were still like, no, f*** it, don't raise the debt limit. Oh, absolutely. Yes, it is. But I think this shows that this is very much a debate that is still kind of being formed. It's in its infancy, and it is something that is shapeable by whoever kind of wins the messaging wars there.

We love an infant debate from a public opinion perspective. We'll just have to, you know, as I always say, we'll just have to keep watching the numbers. We're going to move on to George Santos. Anything anyone wants to say on the debt limit before we move on. All right. George Santos it is.

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We talked about Speaker McCarthy being somewhat hamstrung on the debt ceiling because of Republicans' slim majority in the House, and that extends into our next segment, which is also our good or bad use of polling. So George Santos said, confusingly, two weeks ago, that he would resign if 142 people asked him to.

it seemed like a strange, arbitrary, and somewhat achievable threshold. He later clarified, though, something he's had to do a lot of, that he actually meant 142,000 people, which is the number of votes he received in his congressional election. So public policy polling subsequently polled his district to gauge levels of support for his resignation. And 60% of voters in New York's third congressional district said that he should resign, according to the poll.

which, if you sort of crunch the numbers and extrapolate it out, is 445,000 people. So is it a good or bad use of polling to say that Santos' threshold has been met for resignation? So I'd just like to point out here that he was wrong even about the number of people who voted for him. It was 146,000, not 142,000. That's the kind of journalistic integrity we love.

But no, but I think this was a fine use of polling. I think with one caveat, which is that it was a poll of voters, right? And public policy polling who conducted the survey, it's not clear whether they mean registered voters or likely voters. And likely voters is always like which election. But if you look just at the 2022 election, which it was a high turnout election, but it's still like a midterm year. And the number of people who voted was insane.

certainly less than the registered voter population. It's less than the people who are going to vote in the 2024 presidential election in all likelihood. And if you kind of do the math in terms of just the people who voted in that election, you get 167,863 people is the 60% mark. So I do think that, you know, while you can't just kind of like, like,

do the math and like literally say that 167,000 people believe that because of margin of error and, and, and things like that. Right. How many people did they actually ask in this poll? Like a thousand or less? It's, it's fewer. Right. Exactly. But, but the point of polls, right, is that they are, you know, like extrapolatable to the general population. And so I think that the, you know, Wallace isn't like proof that like you've, you know, talent, you've taken a vote literally, right. And gotten 142,000 slips of paper that say, yes, George Santos resigned. Um,

it is like a strong indicator that at least that many people, um, in his district believe that. Yeah. Yeah. Nathaniel, don't you know that the only poll that matters is election day? Exactly. Okay. That's one opinion. Amelia, Nate,

It was a ridiculous assertion. So why not? Why not do a poll? I mean, yeah, it seems like people don't like that he has lied about apparently everything in his career. Doesn't seem like a

Bad use of polling. It also doesn't mean he's going to resign. Right. Like what he really meant was there will be another election. Get off my back. Right. Right. Right. Like I'm good for the next two years. We'll see if people still remember this. Okay. Nate. I think it's a bad use of polling because we're not, he's not asking for a statistically significant sample or estimate, right? He is asking. How do you know what he's asking for? For 142, we don't know. 142,000 people.

to march up to his congressional office and be like, resign, Mr. Santos, enough. He wants the actual body count. Would a petition count? If 142,000 members of the third congressional district in New York signed a petition, would that count? I would think so, yes. Okay, so that's not polling, a good use of counting. Maybe we'll start at... Petitioning. Good use of counting. We should start a new segment on this podcast called Good or Bad Use of Counting. Okay.

Send in ideas for our first good or bad use of counting segment listeners podcast at FiveThirtyEight.com or you can find any of us on Twitter. OK, so that was fun. But really, here's what this that was meant to say. This was all meant to segue into, which is that like this whole situation is getting more and more absurd. The last time we talked about this, Nathaniel, you pointed out that it hadn't yet been confirmed whether Santos's mother was in the World Trade Center on 9-11, as he had claimed.

It's now, as I mentioned, been confirmed by The New York Times that she was not. But probably the most viral development of the past week was photos and videos showing apparently George Santos in drag in Brazil going by the name Katara Ravach. He denied that it was him. And then he later just said he was having a good time at a party, suggesting that I guess like the photos and videos were him, but that he wasn't regularly a drag queen.

At this point, local Republicans in New York's third congressional district have called on him to resign. But McCarthy, who has been asked repeatedly, has not said that he should resign.

So why not? And look, I know the answer is because there's a slim majority. But at a certain point, doesn't this all just become so embarrassing and burdensome that like it's going to be a slim majority no matter what? Like you're going to be faced with the same conflicts and challenges no matter what. Like what's the difference between a four seat majority and a five seat majority if this is what the five seat majority costs?

Yeah, that's fair. You know, I mean, I think it's worth noting that it wouldn't necessarily be the end of the bad headlines, though, because then there would be a special election and Democrats might pick it up and that would lead to a bunch of Republicans in disarray storylines. So I don't know. I mean, I think the I mean, frankly, I am a little surprised that this is still a story. You know, things are kind of continuing to come out and

You know, if you had asked me back in December or whenever that it broke, if it was still going to be a story on January 23rd, I would have guessed no. But it has been kind of a slow news cycle. And, you know, obviously, the story is has a lot of entertainment value. But maybe McCarthy is assuming that, you know, well, it's got to end sometime and then we'll be past it. And I guess that's been the case for like every other scandal. Right. Although you contested that assertion the last time we are we talked about this.

Yeah, I mean, you know, it won't be over either way because the House Ethics Committee is probably going to look into him and, you know, he may have to resign in February 2024 regardless. So, yeah, I don't know. I think you raise a good question, Galen. It's certainly debatable whether what's in McCarthy's best interest. I mean, but there's also what he's incentivized to do and, you know, arguably like it would

We don't know what's going to happen in terms of criminal investigations. Hanging on to his seat gives him a bargaining chip. So there's that, too. Right. It's not Kevin McCarthy's decision in a way. Right. There are consequences, penalties that he could sort of levy, but he can't. Well, no. Right. He's not making sentences. They can throw him out. They could, right? They can throw him out, but you need a two-thirds vote for that. And Democrats would be like, no, sorry. Yeah.

We love the guy. We love him. But I mean, it's true that McCarthy is not like making Santos's life hard, which he could do. And yeah, I mean, I just sort of I think I'm with you, Nathaniel, that he's just kind of

assuming that we maybe assumed that we would have been past this by now and assuming that eventually something else will, you know, take over in the news. And he's someone, I mean, he, he voted for McCarthy in the speaker vote. You know, it's not like this is Santos is making trouble for McCarthy in the internal workings of the house. So in that sense, he might be a less troublesome figure to McCarthy personally than some other Republicans. Yeah.

I mean, this is a little tinfoil hatty, but so Santos actually supported McCarthy for speaker before all of this happened. I know because I reached out to his team and was taking kind of an informal whip count. Um, but I wonder if there was also something, you know, where Santos was like, I'll continue to vote for you or, you know, like maybe I'll defect, but you have to promise to, to stay, you know, like to not call on me to resign. Um,

Or there's the fact that there's now this one-member threshold for the motion to vacate. If McCarthy turns on Santos, theoretically he could pull that lever and it might not result in McCarthy losing his seat if he hasn't pissed off other Republicans. But McCarthy does have incentive to make literally everybody in the Republican caucus really happy right now. So yeah, I don't know. Yeah, one vote is not trivial, right? You could say it's one vote out of 435, but like...

If he had won fewer vote, I mean it's all kind of path dependent. It's not clear that McCarthy would have survived the speakership battle. It's conceivable one vote made a difference there, right? I mean my thing is like I don't actually think – I said this last time that George Santos hurts perceptions of the Republican brand all that much because he's such a goofball. It's just kind of comic –

relief. I don't know, right? Okay, so contrast that with somebody who is in Congress who you think does hurt the Republican brand. Like, do you think Marjorie Taylor Greene does hurt the Republican brand, but someone like George Santos doesn't? Of course, yes. Can you parse that out a little bit more for me? Because, like, what do we learn about Republicans? Like, there's no particular, like, Republican tendency to, like,

make up very weird lies about like your mother on like 9-11 and stuff like that. I mean, I don't know, right? It's, uh, it's just, it's just like, I guess it continues this trend of sort of Democrats having far less tolerance for scandal, BS, transgressive behavior amongst its caucus and Republicans just sort of being very permissible. Um, like not calling on somebody to resign who lied about their mother being a victim of 9-11 and,

is sort of like weird as far as traditional American politics goes and helps further whatever contrast I think Democrats have tried to, I mean, in some situations, I think Democrats themselves have been critical of how hardline the party has been on encouraging people to resign. But it sort of draws that distinction a little more, at least, like harder to be the party of ethics and morality. I don't know if that's what it's trying to sort of reinvigorate or not, but

But the GOP doesn't really claim to be the party of ethics and morality, right? It's not their brand. Like, once upon a time, for sure. Especially in a post-Trump world. I don't know. Yeah, Yalen, exactly. I think to your point, like, it's like, well, since Trump, whose scandals have, you know, even been more widely publicized than George Santos's, it's like, does this really matter anymore? But I agree with Nate more broadly that, like,

The worst scandals, right, are the ones that kind of confirm or feed into a preexisting narrative. And that's like, you know, Marjorie Taylor Greene feeds into this narrative that the Republican Party is racist and extreme. Whereas this George Santos thing is just kind of, it's so unique, right? Like Nate said, like nobody is making, nobody else has made these very outlandish specific lies before. So it is, it can kind of more easily be put into a box.

Americans love a fabulous guys. They do. I think Nate is right that there's just something like, you know, can't take your eyes off the guy. But also, it's just so strange. And

And people, I don't know. And also, like, I wonder if there's a sense, too, that people are like, OK, you know, he's one guy in Congress. Like, you know, if he were the governor of New York, maybe people would be more worried. But I think there's also perhaps a sense that this is not actually a guy who has a lot of power and he'll get voted out in two years. So how much like, yes,

He probably should not have been elected. How much damage can he do? He's not like he's not like someone he doesn't have the nuclear codes. You said Americans love a fabulous and I have to assume that the combination of that fact plus his district being in the New York metro area means that this will undoubtedly become a musical. Am I wrong?

I would hope so. I would see it. I mean... All good scandals become a musical. The Greatest Showman. Take my money. Starring... In a way, there's no way it doesn't become like... You remember when both Hulu and Netflix had competing Fyre Fest documentaries? The networks are working on it already. I mean, I don't say that with inside knowledge of ABC deliberations, but the networks must already be working on it. Come and talk to us, ABC. We'll be consultants.

Okay. And with that, let's move on to a discussion about unions in politics.

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Union membership declined to an all-time low last year, according to the Bureau of Labor Statistics. Although, as I said, you could say that for almost any year since the DLS started recording this data in 1983. So, okay, I'm just going to say get ready here for a number salad. Hopefully, though, it will provide some context. So overall, membership was at zero.

10.1% last year, down from 10.3% union membership the year before. The rate of public union membership was at 33%, compared to 6% for private employees, and those private employees make up 85% of the workforce. So current union membership is down half from when the Bureau started collecting this data, which again was in the early 80s.

But if you look at other data that encompasses more of the 20th century, it actually looks like unions reached a high in terms of membership mid-century with almost a third of American workers across, you know, public, private, whatever, being members of unions. So this is a longstanding trend. I'm sure that comes as a surprise to no one, but it's a rather stark trend nonetheless.

There is a lot to be said here, and a lot of it would sort of go back to us moonlighting as an econ podcast. But let's start with the political question here, which is what role do unions play in politics? And therefore, what impact does their decline have on American politics? I mean, the boilerplate answer is that unions have been closely aligned with the Democratic Party for a long time.

help serve to coordinate Democratic Party elections by endorsing candidates, for example, or by at a local shop encouraging union members to vote for a certain candidate, both in general elections and in primaries. Obviously, as Democrats have moved away from being kind of the party of the working class, then unions are in some ways maybe even

More important for Democrats, right, even though they're lower in numbers, because like you're now dealing with people who like might ordinarily not be inclined to vote Democratic and in a union, maybe they would. But also, you know, you know, there are new efforts to unionize companies in industries like media, for example, or tech. And that's not the traditional approach.

union job. I'm not saying anything wrong with people in those industries unionizing, right? But that's probably constituents already kind of Democratic leaning already. But yeah, I mean, I think Democrats would love to keep a foothold in manufacturing and other traditional jobs and service sector jobs, of course, are unionized in a lot of states. I think Democrats would say that matters quite a bit. I think that's one reason why they'd say that they

tend to win close elections in Nevada, for example, because Nevada's workforce is heavily unionized because of the big casinos. And like, and that's a state where demographically you might say, hey, it's kind of working class and not that many African-Americans. And it kind of looks like it should be kind of a Trumpy state. And it hasn't been. And so, yeah, no, unions are important for the Democratic Party. Also fundraising. That's been another really important role. Fundraising.

Yeah, they're, you know, they have historically been some of the big outside groups that have spent money on behalf of Democratic candidates, kind of similar to how, you know, I don't know, the Club for Growth on the Republican side or something like that. Can we say a little bit about why union membership has declined to such a great degree in, you know, the latter half of the 20th century? Yeah.

Well, I mean, there's been a decades long political campaign to weaken unions. I mean, like looking at this history, the National Labor Relations Act passes in 1935. That gives Americans the right to organize, to join a union, to collectively bargain. It doesn't.

Basically, the campaign to weaken it starts immediately. And in 1947, it gets weakened in the Taft-Hartley Act. There's subsequent legislation weakening it. Public sector unions organize later and then

They have been subject in actually quite recent years to pretty significant weakening at the hands of the judiciary. In 2018, the Supreme Court ruled that public sector unions can't require dues from non-union workers, which is a

big blow because if those people aren't paying money in but they're still getting the benefits of the union that is a really big problem for the union for obvious reasons so you know there have been a lot of other things going on too but

But, you know, this it's something where are there's been like a very strong and very successful political push to make it harder to organize. And also, you know, penalties for employers have been highly variable by administration and and government.

Often, there just haven't really been serious consequences for violating labor law under Republicans. So a lot of this is a political story.

Yeah. And in recent years, especially, you've also seen the proliferation of right to work laws and other anti-union laws on the state level. So states like Wisconsin, as you know, Galen Act 10, and then they adopted right to work in 2015. States like Michigan adopted right to work in 2012. And I think this kind of also goes toward, you know, the earlier discussion, which is, you know, I actually haven't looked into it, but like, you know, how much of the decline of

Democrats in like the Midwest and with these voters is because, you know, kind of unions have been weakened by these laws. But also, I think there's like clearly Republicans, in addition to Democrats, think that unions help Democrats, I think, because it's been Republican controlled governments after the 2010 election in particular that went after unions with these laws.

I think it is important to say here that the answer to this question is somewhat complicated and controversial that like you've sort of given the politics answer and sort of how the political process has whittled away union power, but prepping for this conversation, a lot of the answers don't have much to do with politics, which is one that the kinds of jobs that have historically been unionized in the United States to a large extent don't exist in the United States anymore. So obviously manufacturing was one of the biggest, uh,

That's been offshore in many ways. On top of that, sort of studies into union spending and how unions have operated over the past 40 years is that they've prioritized sort of lobbying and political spending. And like you're talking about, as opposed to recruiting new members, you can see the sort of the trend lines

over time, that unions more and more spend money on sort of self-preservation, that expansion. So there has been some criticism of unions themselves amongst the sort of like pro-labor crowd that unions aren't doing much to actually maintain power or even expand power in the United States. So, you know, I think there's a lot going on here with a changing global economy and also politics.

I think that's one of the things that's so interesting about this moment, though, Galen, because there is more interest in unions. I mean, that's why we're talking about it. And their unions have been criticized really heavily for not kind of adapting sufficiently to the way that work in the United States has changed.

And there have been more efforts to unionize in industries like tech, which just the way that those companies are organized, the way that you have to organize workers, the way that you bargain media is the same way. It's just really different than manufacturing. So, you know, it's definitely a test.

to see whether unions can move into an era where, you know, where work just looks really different than it did in the 1970s. Nate, sort of we started this conversation by you talking about the relationship between unions and the Democratic Party.

but also that the relationship between the Democratic Party and the working class has been strained as well. So how, like, union membership or union household membership is something that's been asked on exit polls, you know, for a long time. So we know how union households vote. What have we seen over time as sort of unions have declined and the Democratic Party's relationship with labor has become strained?

I mean, so one story is that increasingly politics has kind of moved toward culture war issues and not kind of bread and butter economic security issues as much. And that explains part of the story. You know, I miss kind of the old like what's the matter with Kansas argument, which is sort of debated. Right. But it's like, well, how come Democrats struggle so much?

among certain types of working class voters when they're supposed to be the party of the working class. And the answer has been, well, back then it was like, well, these gay marriage and Christian values stuff, right? Maybe now, frankly, it's more stuff that's coded or not so subtly coded messages about race and still gay people, but transgender people also and everything else. Although immigration has long been seen as an economic issue as pertains to fights over unions, to be clear.

Well, that might be an issue. So unions would traditionally not be thrilled about immigration, right? And they would not be thrilled about free trade. So in that way, the Republican Party is offering something that specifically attracts working class people. Well, I mean, I think it's like part of, I mean, there is this criticism that I'm sure a lot of people have of like, okay, Democratic Party, it's all run by these super like educated people.

you wouldn't necessarily call them elites because they're not necessarily making a ton of money, but super educated people who maybe are isolated from how the working class really feels. And so to have a center of power in the Democratic Party that is of the working class... By the way, these union jobs are very multi-ethnic. It's not just a bunch of working class white people, it's working class people of every race and ethnic group.

So actually, black Americans are more likely to be in unions than any other race in the country. Yeah. I mean, if you look at like union data, right, I think in the 2022 midterms, I'm looking this up right now, according to the AP VoteCast poll, people who are in a union themselves are

voted Democrat by 14 points. People who were in a union household, but not a union member themselves, voted Democrat by two points. And then everyone else, no union, voted GOP by eight points. So that's a pretty big gap, right? It's explained partly by the fact that we were talking about earlier that actually, I think there are more people of color in unions proportionately than white people, but even accounting for that, right? And also if you talk, I mean, like, you know,

Democrats begin to have a huge problem if they start losing further ground. They already have lost some with working class voters of color. Right. Then it becomes a pretty small coalition pretty quickly. And so I'm just saying, like, you know, to have this kind of multi-ethnic progressive force among working class people would be like very beneficial to Democratic Party. And if anything, I think they probably won't.

underrate the importance of unions to their political future. At the same time, there's a little bit of trade-off where the more explicitly political a union behaves, then A, that might turn off some potential members, B, people might backlash against unions and oppose them for political reasons. So it's not necessarily totally free money or anything for Democrats, but I think it's a somewhat underappreciated, still now political force.

Yeah, no, I just want to sort of mention here, reiterating your point, building on it, Nate, that according to the Center for American Progress, which looked at the 2020 vote and the exit poll data, and here's a quote from them. They said, "...the union advantage for Biden was particularly pronounced amongst white voters, among whom union voters were 18 percentage points more favorable than white non-union voters."

Which is to say, like, yes, you know, black Americans are more likely to be in unions. But specifically, it makes you can see that it makes a difference in a political difference across sort of racial boundaries.

Yeah, well, I mean, there was a paper that was published in 2018 by James Feigenbaum, Alexander Hertel Fernandez, and Vanessa Williamson, where they sort of tried to use a natural experiment, basically, of like one state enacting a right-to-work law. And they looked at counties that straddle state borders. So they looked at a county on either side of a state and a right-to-work border. And they found that right-to-work laws reduced detention

Democratic presidential vote shares by 3.5 percentage points. So, you know, it's one study, but I think it basically is reinforcing what we're saying, which is that, you know, union membership does seem to have a very tangible, measurable benefit for Democrats. Yeah, you can also, um,

try to use regression analysis, right? Where you can take a big survey like the formerly called the CCES, which is done by YouGov and Harvard. And they have lots of variables for every voter, you know, 50,000 voters. You can say, okay, if we control for race and party membership and everything else, right, does being in a union still have an impact? And generally when I've done that, the answer is yes, right? It does have an impact. It's not

The most important variable, right, it's not like, you know, the big ones like, you know, race or religion or gender, but like it has an impact when you control for other factors. Yeah, I do want to bring up here while we're talking about the voting behavior of union households that there was a lot made of how Hillary Clinton performed with union households versus Trump in 2016, which gets back to the conversation, Nate, you and I were having a little bit about immigration and free trade and

and so on. And that was visible, but it seems to have reverted for the most part in 2020. So in 2012, Obama overperformed Romney with union households by 18 points. That's across all races, all ethnicities, income levels, whatever. In 2016, Clinton only overperformed Trump amongst union households by

by eight points. So that was more than halved. Then in 2020, Biden overperformed Trump with union households by 16 points. So almost back up to where Obama was in 2012.

And Biden, you know, this may not come as so much of a surprise because Biden has really hammered sort of his relationship with unions. I think he announced his candidacy from a union hall in Pennsylvania. He's quoted saying that he's the most pro-union president ever elected.

Now, we've outlined some of the reasons that Democrats might be so vocal about their pro-union stance. However, at the end of the day, unions are only 10%. Union membership is only 10% of Americans. Yet, it's like he's announcing his candidacy from a union hall, like,

Presidents of unions oftentimes are headlining, you know, political events, things like that. So for 10% of the country, like why put so much of an emphasis on this relationship? If that question makes sense. Is it sort of messaging beyond just unions? Well, so it's,

The 10% is union members, so union households is going to be larger than that. And also, I mean, just to say, white evangelical Protestants are not a huge chunk of the U.S. population, but they're a really important voting group for Republicans. So I think it's, you know, in some sense, it's just showing how when you have a block of people who organize and get people out to vote and tend to vote in a similar direction...

that's very valuable for a party. But go ahead, Nathaniel. Yeah, exactly. I think it's like, you know, if it's kind of a part of your base, they can have an outsized impact. But yeah, so the percentage of people who are voters in 2020, this is 2020, the presidential election, who are members of a union household,

um, was 20%. So that's twice the number basically of people who are actually in unions. So it's a little stronger than that, but also just like, I think it is a bit of a proxy for just being pro worker in general. And of course, you know, lots of people who aren't in unions are still workers and maybe, you know, um,

agree with the union's goals. There was a Gallup poll last year that said that 71% of Americans approved of labor unions, which was actually the highest it had been since 1965. And so, yeah, I think it shows that it's not bad to be affiliated with labor unions. Right. To be totally transparent, I was hoping to set you up to cite that Gallup number,

Because that's kind of remarkable, right? We've described the sort of status and power of unions in America as being a political question and a political debate. But 71% of Americans view unions favorably. And that's 2022. That's even after T.

teachers unions played a role in keeping schools closed during COVID-19 and that became an actual political issue. So even after all that, 71% of Americans view unions favorably, the highest number since 1965. Does that also suggest that unions and, you know, maybe Trump's pivot towards a more populist GOP

that unions are no longer politically divisive? Like, have we entered a new era where, like, you can't really bash unions and have that be a politically winning strategy?

Yeah, on the face of it, right? A lot of it, of course, comes down to how strong those feelings are, whether people are just reflexively, you know, saying, oh, yeah, unions are good. Because like, they haven't maybe been in the conversation as much, but... Well, in the specifics of races, like if you're talking about like a mayoral race in a big city, I think unions are still going to play kind of a different role than they would, you know, if we're talking about like presidential rhetoric. What do you mean?

You're saying that, like, it might be more feasible to bash them or...

Yeah, I mean, because like mayors are actually negotiating with unions to like keep schools open or to keep public utilities running. You know, like it's just it's a it's an area of government where you're actually like interacting with unions, where unions are affecting people's lives in a very tangible way. I just think it's going to be a different dynamic than when you're talking sort of grandly about unions, because I think one of the things that that Gallup poll is picking up is that Americans are feeling like

many Americans are feeling like there is a serious power imbalance between employers and workers. And it was interesting when I was prepping for the podcast, I was looking at sort of how people were talking about unions

almost 100 years ago now, when these laws were going into effect. And there was a big emphasis on unions return, giving a sort of democratic spirit to workplaces, to making them into a place where workers had a voice, and where they had the power to get together and decide what was sort of good for workers and go into that negotiation with employers with power. And I think

Because if they had more power, they would be less popular. Right.

That's funny. Yeah, yeah, yeah. Yeah, exactly. Like we just, you know, it's kind of like, yeah, no, I mean, if they're not like really affecting your life, then you're like, sure, great. Unions are great. I don't know how it would be if they were more powerful, but I think there's a, we're in a moment where people are feeling that sense of, you know, things are not equal in the workplace between employers and workers and unions are this structure that for the past hundred plus years has been a symbol of, you

giving more of a balance in the workplace, making it more democratic. You know, they've also been a symbol of a lot of other things. But I think that is kind of what people are feeling when they're answering that question. Yeah, Amelia, on that note, you know, it's interesting when you look at the historical trends for that Gallup poll,

The low point was 48%, and that was pretty recently, in 2009, and it's really just been on the up and up since then. And I do wonder if that's a, you know, this was a time back in, you know, 2010, 2012, when Republicans were attacking unions more explicitly. But since then, you know, unions have been weaker. And so maybe kind of speaking to that imbalance that you're talking about, also you've had, you know, Donald Trump, who's kind of a more, you know,

you know, like, you know, or like less explicitly anti-union, let's say, president and also like Bernie Sanders bringing kind of attention to kind of the workers' plights. So I think all of those things have kind of created a, you know, a little moment for unions, at least in public opinion. But of course, again, I think it's worth noting that the fact that they, in absolute numbers, or not absolute numbers, but in kind of the actual statistics of who belongs to a union and their actual strength, they are at this all-time low.

I mean, I will say the NLRB, the National Labor Relations Board, did report an uptick in union petitions in 2022. So I think there is more interest in workplaces in starting unions. Like, obviously, a petition is really far from actually having

a union, but I think that that's an important data point. The other thing that I think will be really interesting to watch is what happens in Michigan's legislature this year. Democrats are coming in with this historic trifecta, and one of the things they're doing is pushing to repeal the state's right to work law, which was passed just a couple of years after that low point you were just citing, Nathaniel, in

2012. And the right to work law, of course, allows employees to opt out of the union, but get out of paying union dues, but still get the same benefits of being in the union. And, you

This was something that Democrats talked about on the campaign trail in the midterms. It's clearly a priority for them. It will be really interesting to see if they actually can pull that off. Yeah. Yeah. For folks who are listening to this thinking, wait, I thought there was something of a resurgence amongst unions. We've seen unionization at Apple or Starbucks or Amazon, or like you've all said, at media companies. So I should say, the overall number of union jobs went up.

up in 2022, but it did not grow at the same rate as non-union jobs. So as a percentage of the workforce, the percentage of the workforce that is unionized overall still shrank to an all-time low, but the raw number of union jobs grew. Hope that all makes sense.

All right. We've made it to the end of, I hope, a both numbers heavy and fun heavy podcast today. I think we're going to leave it there. So thank you, Amelia, Nathaniel, and Nate. Thanks, Galen. Thanks, Galen.

My name is Galen Druk. Tony Chow is in the control room and Chadwick Matlin is our editorial director. You can get in touch by emailing us at podcasts at 538.com. You can also, of course, treat us with any questions or comments. As I mentioned, if you have any ideas for good or bad use of counting, that is where you can reach us. If you're a fan of the show, leave us a rating or review in the Apple Podcast Store or wherever you listen to your podcasts.

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