Welcome to the Depth Dive. We've got a really
fascinating mix of sources this time that covers
everything from these high -level global trade
trips. all the way down to, well, some pretty
tough economic news locally. And even into political
strategy, it's quite a spread. It really is a
study in contrast. And our goal today for you
is basically to connect these threads that might
seem totally separate. You know, how do these
big international deals or maybe the lack of
them actually hit home economically for Americans?
And why does some politicians seem laser focused
on the presidency, sometimes overlooking powerful,
maybe more winnable jobs? Yeah, exactly. We're
going to start with this big international tour.
The source is called it. the TACO TRIP, which
stands for Trade and Coordination Offensive.
We'll look at what they claimed they achieved
overseas and then immediately contrast that with,
well, the tough realities hitting industries
like construction right here. Let's start there,
maybe in Pennsylvania. OK, so let's unpack this
TACO TRIP. It was a week -long tour, right? Donald
Trump hitting Malaysia, Japan, South Korea. The
focus was trade, tariffs, and it all wrapped
up with that big meeting with President Xi Jinping
of China. So starting in Malaysia, what was the
main tangible result? The key thing they secured
was getting some Asian countries to coordinate
on unfair trade practices, mostly aimed at China.
But what's really interesting is how the sources
describe it. They're basically saying it's a
kind of watered down version of the Trans -Pacific
Partnership, the TPP. The TPP, the deal the US
pulled out of back in 2017. That's the one. So
essentially, it walked away from the big comprehensive
deal, spent years negotiating, and ended up with
something Less comprehensive, let's say. Okay.
So what did the Asian countries get for agreeing
to coordinate on US sanctions? They got a much
lower tariff rate on their exports to the u .s.
The sources call it a bargain rate just 19 %
Yeah, which you know Contracts pretty sharply
with some of the promises made in return like
Malaysia pledged 70 billion dollars in US investment
over 10 years, right? But I remember reading
there was a pretty big asterisk on that 70 billion
dollars wasn't there Is that really a solid win
or more like a headline very conditional? Yeah,
Malaysia put in this specific clause saying they
can delay the actual investment planning for
three years and You know potentially just scrap
the rest after that It feels more like a political
pledge designed to last maybe only as long as
the current administration Although Thailand
did make a very concrete promise. They're buying
80 Boeing aircraft, which is about 19 billion
dollars. And since Thai Airways already uses
Boeing, that seems like a genuine, recursively
sound deal. OK, that makes sense. But let's talk
about what the source is called the critical
missing piece, the thing that kind of undermines
the whole effort. rules of origin. Can you explain
for our listener why this specific detail, basically
proving where something was really made, is so
fundamental? Why does ignoring it kind of wreck
the whole China tariff strategy? Yeah, it's absolutely
crucial because without strict rules of origin,
you create this massive loophole. China can just
ship parts, say, to Thailand or Malaysia. They
get assembled there, maybe just minimally, and
then the finished product gets shipped to the
U .S. labeled Made in Malaysia. completely bypasses
the tariffs meant for Chinese goods. Exactly.
It evades the U .S. tariffs, and the net result
is, well... Pretty much zero reduction in China's
role as this sort of world's factory. It's a
structural flaw in the whole approach. OK, moving
on to Japan. Trump met the new prime minister,
Sane Takaichi, and the sources seem to suggest
the focus was mostly on getting a win he could
talk about, maybe not something with long term
legs. Was there any real progress on getting
big U .S. investments there? Not really, no.
I mean, Trump was apparently asking for hundreds
of billions in U .S. investment. But, you know,
the Japanese PM can't just order private companies
like Toyota or Sony to build factories in the
U .S. That's not how it works. They make decisions
based on economic supply chains, not political
demands. So what was the win then? Well, the
sources say Takaichi just confirmed she planned
to buy some Ford F -150 trucks. Apparently, that
was enough to be framed as a political victory.
OK, and then the final stop, the big meeting
with Xi Jinping in China after all the tough
talk, the tariff threats. What actually happened?
What was the outcome? The bottom line, maybe
a bit anti -climatically, was just restoring
the status quo ante, getting back to where things
were before China agreed to keep exporting rare
earths for another year, and they agreed to buy
some American soybeans again. That was basically
it. So Trump's big achievement was undoing the
damage his own threats had caused. Pretty much.
Returning things to how they were. And the source's
assessment of this is quite harsh. They actually
pull out a quote from literature to describe
it. A tale told by an idiot full of sound and
fury signifying nothing. Wow, strong words. Yeah,
and the point they're making is that Xi Jinping
plays the long game. He's a strategic thinker.
He likely figured that offering the illusion
of a win, you know, promising to buy some soybeans
would satisfy the immediate political need for
a headline back in the U .S. Right, without giving
up anything truly substantial, like on those
rules of origin or intellectual property theft.
Exactly. It prevents the U .S. from pushing for
the serious structural changes. OK, so that lack
of real structural progress on trade, the fact
China can still transship goods, that brings
us right back home. Let's connect that global
uncertainty in the tariff situation to the actual
financial pain being felt, specifically, like
you said, in the Pennsylvania construction industry.
Yeah, the sources paint a really clear picture
here. There's been a noticeable slowdown starting
back in 2023. One contractor, Greg Harris, mentioned
a real drop in customer confidence. People are
just hesitant to spend big money right now. So
the work hasn't totally dried up, but it's changed.
Exactly. The shift is away from the sort of high
-end cosmetic stuff, you know, fancy kitchen
remodels, big home additions. It's more towards
necessary repairs, essential upgrades. Another
company, Excel Remodeling, saw their backlog
of jobs drop quite a bit. It suggests people
are reacting to financial pressure, not pursuing
luxury projects anymore. And what are the specific
economic things the contractors are pointing
to? What's making homeowners pause on these big
projects? It sounds like a triple whammy, really.
First, interest rates. They're much higher, which
makes financing these projects tough. The source
has mentioned a benchmark, like a five -year,
$30 ,000 home equity loan is running around 8
.13%. That's going to scare a lot of people off.
Yeah, that's significant. Right. Second, costs
are way up. Materials, labor. They've jumped
about 18 % year over year since 2020. And those
tariffs we were just talking about, the ones
from the taco trip discussions that didn't get
resolved structurally, they feed right into that
18 % increase, don't they? This is an abstract
policy. It's the price of wood, cabinets. Precisely.
That 18 % includes the impact of specific tariffs.
There's a 10 % tariff on timber and lumber imports
and a really steep 25 % tariff on things like
imported kitchen cabinets and furniture. Because
there's no strong policy tackling that transshipment
loophole, those costs just get passed down the
line right to the homeowner in Pennsylvania.
And the contractors are saying this feels. different,
even compared to the big housing crash in 2008.
That's a really interesting point they make.
Back in 08, yeah, new home construction absolutely
cratered. But remodeling actually grew because
people decided to fix up their existing homes
instead of moving. Oh, okay. But this time, the
slowdown is hitting across the board new builds
and remodeling. And on the commercial side, contractors
are saying projects are dragging out longer,
not just because financing is harder to get,
but also because of issues at the local level.
Like what kind of issue? Specifically, the building
permit process, particularly in Pennsylvania.
Apparently, it's not streamlined at all. Each
little municipality has its own rules, its own
timelines. It creates huge headaches and delays
for contractors working across different areas.
Okay, so given all that, what's the outlook?
Are builders feeling optimistic for a quick turnaround?
Not really, no. They're pretty pessimistic about
the near -term. The projection seems to be that
2026 will probably start a lot like 2025 ended,
unless, you know, interest rates drop significantly.
And then there's the political uncertainty factor,
things like government shutdowns. That threat
hangs over them because it delays government
-funded projects, which many commercial contractors
rely on. That mention of political instability
is actually a perfect bridge to our next segment,
political strategy. The sources point out something
pretty fundamental. The presidency has just become
the dominant branch of government, even though
technically Article I puts Congress first in
the Constitution. And this seems to be driving
a really weird, maybe irrational political trend.
Yeah, we're calling it the probability problem.
You have these really ambitious, often very qualified
politicians, right? And they seem to be choosing
the political equivalent of a lottery ticket,
a tiny chance of the presidency over what looks
like an almost guaranteed win for a really powerful
job, like a governorship or a Senate seat. It
does seem strategically odd, doesn't it, considering
how much power governors and senators actually
wield. Can you give us some of those examples
the source has brought up where ambition seems
to trump? Uh, the electoral math? Sure. Take
Kamala Harris. The sources pointed out she passed
up a very winnable run for California governor
to enter a presidential primary where, according
to betting markets at the time, her odds were
maybe 1 .5 percent. Pretty long shot. OK. Who
else? Or think about Andy Beshear in Kentucky.
He's term -limited as governor. He's won statewide
three times in a red state. He'd be the clear
favorite for Mitch McConnell's open Senate seat.
But all signs point to him aiming higher for
the White House. And it's not just them, right?
Pete Buttigieg moved to Michigan, could have
run for open governor or Senate seats there,
likely as a favorite, but seems focused elsewhere.
Exactly. And Ron DeSantis, even after the 2024
primary didn't go his way, seems focused on 2028
presidential run odds, currently around 2 .4
percent, apparently. Instead of, say, running
in the 2026 Florida Senate primary against an
appointed incumbent, a race he'd probably win
easily. Right. And J .B. Pritzker in Illinois.
Passing up Dick Durbin's Senate seat, which seems
like a safe bet in deep blue Illinois again for
a very long shot presidential bid. It's a pattern.
This focus on the top job seems to overshadow
very powerful, very achievable alternatives.
And this disconnect, this focus issue, it seems
mirrored in some of the voter dynamics, especially
around the economy. The sources highlighted a
pretty sharp drop in support for Trump among
some minority groups. Yeah, it's quite dramatic.
His approval with Latino voters, according to
these sources, fell from around 44 percent down
to 25 percent. And among black voters, it's down
at 16 percent. And the reason cited is overwhelmingly
economic pessimism. You have 84 % of black respondents,
70 % of Latino respondents saying they're deeply
unhappy with the country's direction, feeling
their own economic situation has gotten worse.
And this connects to something else the sources
mentioned, this idea of the great switcheroo,
the sort of gentrification of the Democratic
Party since about 2008. That's right. The data
suggests Democrats have, in effect, swapped lower
-income voters for higher -income voters over
the last decade or so. median income in House
districts, it's now higher in Democratic districts
about $81 ,000 compared to $69 ,000 in GOP districts.
So what does that mean in terms of policy focus?
It means affluent Democratic voters might be
more focused on issues like climate change, social
justice, maybe the salt cap deduction limit,
things that resonate with higher earners. Meanwhile,
lower income voters who might be drifting away
are probably more focused on immediate concerns.
Jobs, inflation, the price of gas and groceries.
But the argument in the sources is that this
shift towards a wealthier base. It's not sustainable
for winning national elections. Mathematically,
it's tough. There just aren't enough high income
voters nationwide to form a stable long term
majority coalition. So the recommendation coming
out of these sources for Democrats is basically
to retool their messaging to seek more directly
to working class concerns again. OK, like how?
Can you give an example of reframing a policy?
The main suggestion was around the Green New
Deal. Instead of framing it primarily as an environmental
or energy policy, sell it almost exclusively
as a blue collar jobs program. Really hammer
home the jobs in manufacturing, installing, maintaining
all that renewable energy equipment. Speak that
language. Makes sense. And to tackle the rising
prices problem directly. Yeah, the sources suggested
a pretty bold antitrust approach. Propose a new
law aimed at breaking up huge companies specifically,
any company that controls more than, say, 10
% of its market. The idea is simple. Force more
competition. More competition should drive down
prices. That's a message that hits home immediately
for anyone worried about their budget. Okay,
shifting gears a bit to election mechanics, there
was this detail about the Department of Justice
sending election monitors to California and New
Jersey, which seems odd, right, since both states
generally run their own elections pretty smoothly.
Yeah, Democrats are definitely interpreting that,
according to the sources, as a politically motivated
move. They're calling it potentially a dry run
for voter intimidation tactics ahead of the 2026
elections. The specific fear is that a future
administration could use federal authority to
send uniform federal officials to polling places,
maybe demanding proof of citizenship, which isn't
required to vote. So what are states being advised
to do? How can they prepare for or push back
against that kind of federal interference if
it happens in 2026? The sources laid out some
really practical proactive steps. Things like
heavily promoting early voting and mail -in voting
to minimize polling place interactions. Creating
easy to use online systems where voters can track
their ballot, confirm it was received and counted.
Okay. Also distributing simple voter rights cards
in English and Spanish that clearly state proof
of citizenship is not required. And maybe most
importantly training lots of volunteers and lawyers,
train them to be present, to film any potential
intimidation, and, crucially, to know and cite
the specific statutes that prohibit interfering
with voters. The idea is to flip the script,
make the potential intimidator feel like they
are the ones being watched and held legally accountable.
That's quite a tactical response. Now, let's
wrap this up with a really interesting kind of
counterintuitive piece of political history the
sources dug up. The Swing State Senate record,
they identified seven swing states, or SSS. Arizona,
Georgia, Michigan, Nevada, North Carolina, Pennsylvania,
and Wisconsin. Right. And since Donald Trump
took office in 2017, there have been 21 Senate
races held in just those seven key states. Now,
you'd probably expect the results to be pretty
close, right? Maybe 11 -10, one way or the other.
Yeah. Seems logical for swing states. But the
actual record is, well, it's shocking. Democrats
have won 17 of those 21 races. Republicans have
won only four. That means Republicans are batting
just .190 in Senate races in those competitive
states during the Trump era. Wow, 17 to 4. That
really changes the narrative about... those states
being pure toss ups, at least for Senate races
recently. How does that pattern potentially play
into the 2026 Senate elections? Well, it suggests
Republicans might have a deeper, more structural
challenge winning these crucial statewide races
than may be commonly thought, even when the national
mood might seem favorable. And looking ahead
to 2026, three of those seven SSS states have
Senate races, Georgia, Michigan and North Carolina.
Two of those are open seats. In Georgia, the
Democratic incumbent, John Ossoff, is reportedly
pulling ahead right now. And in North Carolina,
the likely Republican candidate is Michael Watley,
the former RNC chair who's never actually run
for office before. He's potentially facing Roy
Cooper, the former governor, who's won statewide
six times. So that 17 to four historical pattern,
it suggests a potentially tough fight for Republicans
in those key races. Hashtag, tag, tag outro.
So this deep dive really brought some sharp contrast
into focus for you, our listener. the gap between
you know the claimed successes of international
trade trips and the very real economic squeeze
being felt by folks like construction contractors
back home in Pennsylvania. And we also unpack
that strange political dynamic where the sheer
allure of the presidency seems to make highly
ambitious people overlook really powerful maybe
more strategically sound political options closer
to home. Choosing that long shot over a near
certainty. So here's the final thought we want
to leave you with something to chew on. Think
about that stunning 17 to 4 Democratic lead in
swing state Senate races since 2017. Now, midterms
usually go against the party in the White House,
right? So does this persistent pattern, this
Republican underperformance in key statewide
races point to maybe a deeper systemic weakness
in the Trump era that might actually continue,
regardless of the national mood? And what could
that mean for control of the Senate come 2026?
Yeah, keep that 17 to four scorecard in the back
of your mind as we head into the next election
cycle. It's a fascinating dynamic. We'll see
you next time for the next deep dive.