A Wake Up Call For California Democrats, Josh Stein's Inaugural Address, Trump's Agenda Is *Already* Raising Prices

Our Next Paid Subscriber Get Together Is Wed, Jan 22 at 7pm ET

Good morning all. Let’s start today with a recording of North Carolina Governor Josh Stein’s Inaugural Address. The Hopium community was the largest investor in the country in the North Carolina Democratic Party last cycle, contributing $1.1m, and we had very important down ballot wins there, including this vital one. Enjoy everyone.

Our many down ballot wins in North Carolina remain some of our most important victories in a tough 2024, and I am grateful to the many thousands of you who contributed and volunteered. It was perhaps our most consequential work together in the past cycle.

Now, two sketches of things I’m working on, to be more fully explored in the days ahead….

Trump’s Staggering Economic Illiteracy Is Already Raising Prices For People Here And Around The World - Financial markets are worried about Trump’s incoming agenda. Long term interest rates are rising here and everywhere, driving up costs, making things more expensive here and abroad. In reviewing a new report from the IMF revising American growth upward (meaning the economy Trump is inheriting is even stronger than was previously believed), the NYT writes:

But newly elected governments around the world are elevating economic policy uncertainty, posing risks that could alter the trajectory of the global economy in the coming months, the I.M.F. cautioned.

Those wild cards are particularly acute in the United States, where the incoming Trump administration’s proposed tax cuts, deregulation, tariffs and curbs on immigration could ignite inflation. All of these proposals have a common element, Mr. Gourinchas said: They are poised to increase price pressures.

Yesterday, when asked about the inflationary agenda of the incoming Trump Administration, Treasury nominee Scott Bessent said he knew of nothing in Trump’s agenda that would raise prices for Americans (even through they are already going up!!!). Watch this. It’s stunning:

Paul Krugman has been doing a great job explaining how bananas the Trump economic arguments are at his new Substack. Today in a column, Voodoo, MAGA Style, he writes:

Patriotism is still, I guess, the last refuge of scoundrels. But for the past 45 years or so — ever since Reagan — economic growth has come a close second. The left isn’t completely free from this nonsense, but mostly what we see are right-wing politicians justifying cruel and/or irresponsible policies — massive tax cuts for the rich, harsh treatment of the poor and working class — with the claim that all will be well because these policies will unleash rapid economic growth.

Donald Trump has brought his own brand of nonsense, with claims that tariffs can make foreigners pay for everything. But the old voodoo is still very much part of the mix.

(No, I won’t abandon the term “voodoo economics.” It has a specific, well-known meaning with strong historical associations, and nobody actually believes that it’s an insult to anyone’s religion.)

Which brings me to Scott Bessent, Trump’s pick for Treasury secretary.

The other day I wrote about Trump’s team of economic yes-men, but I didn’t say anything about Bessent, who was widely regarded as a relatively conventional, reassuring pick. Yet Bessent’s “3-3-3” economic plan — or maybe it’s just a concept of a plan, since he has provided no specifics about how he might achieve his goals — is full-on magical thinking.

For “tax cuts create growth” isn’t really grounded in economics. It’s social policy masquerading as economic policy. It’s more for me and my people, and less for you and yours. It’s the logical outgrowth of the GOP’s tragic embrace of the Southern Strategy in the 1960s, and the Party of Lincoln’s adoption of exploitation of racial fear and otherness as its central domestic offering. While it worked for Reagan, to a degree, it has not worked since. The last three Republican Presidents brought recessions, higher deficits and economic struggle. The last two recessions, the Bush and Trump recessions, were severe, historically disruptive and did enormous damage to the economic health of working people across the US.

Magical thinking. Voodoo economics. Decades of profound economic illiteracy. The incoming “adult in the room” Treasury Secretary” said under oath that he knew of nothing in the Trump agenda that could raise prices when prices have already risen due to their agenda. The markets, and all of us, are right to be worried about the Trumpian shitshow to come.

A Wake Up Call For California Democrats - I am running out of time today to give this the full treatment it deserves, but here we go - California Democrats need to take the MAGAfication of Silicon Valley very seriously. Elon Musk helped remove the Democrats from power in the US, and is working to remove pro-democracy, anti-Russia parties from power in Canada, Germany and the UK right now. Elon and MAGA’s depraved attacks on Mayor Bass and Governor Newsom, in the midst of a horrific tragedy, is a sign that they are coming for California too.

As I’ve been writing here from the very first day of Hopium our family - and perhaps the broader pro-democracy family in the West - has been very slow to understand the true nature of the conflict we find ourselves in today. We have been slow to understand, and even slower to develop a comprehensive response. But given everything that has happened in recent months there is no excuse any longer to feign ignorance of what we are up against. As I wrote a few days ago, all of us now must “raise our game, go 24/7/365” and build a new far more modern, ferocious and effective politics. Or we should expect to keep losing, and to keep losing things that really matter to all of us.

The attacks on Bass and Newsom are not just political attacks on two Democratic politicians. They are attacks on the modern political economy of California itself. They began immigration raids last week in Bakersfield to undermine the California ag sector (expect them to continue). They’ve interfered with the response to the fires. They are going to make recovery difficult, expensive, challenging. MAGA is out to destroy liberalism here in the US and around the world. And it’s now coming for California too.

A few more things:

• Watch my interviews with three of the leading candidates for DNC Chair - Gov. Martin O’Malley, Ken Martin and Ben Wikler (all Hopium interviews come with transcripts too for those who like to read rather than watch these conversations).

• We’ve endorsed Abigail Spanberger for Governor of Virginia. Watch my recent interview with her, learn more, volunteer and consider donating to her campaign. Our goal is to raise $100,000 for her by March 31st. We’ve already raised $15,000 - thank you all.

• I am speaking to a major political gathering in person at the University of Southern California on Thursday, January 30th. My panel starts at 215pm PT - join us in person if you can.

• Keep making your calls everyone. Need to keep fighting the Unacceptable 4 - Gabbard, Hegseth, Kennedy, Patel. Read my new essay on MAGA as a secessionist movement.

• For those coming up for renewal for your paid Hopium subscription please make sure your payment info is current. Paid subscribers keep this place going and the Hopium flowing!

• The next Hopium live paid subscriber get together will be Wednesday, January 22nd at 7pm ET.

• Follow me on Bluesky.

• Remember - Monday is the Martin Luther King Jr. Federal Holiday. Let us celebrate it joyfully and enthusiastically, together.

Keep working hard all. Proud to be in this fight with all of you - Simon