An Election Year No One Could Have Predicted

Kathleen Hunter
An Election Year No One Could Have Predicted

(Bloomberg) --

Going into March, the biggest political question in the U.S. was whether Democratic presidential candidate Joe Biden would regain his footing as front-runner for the party nomination.Biden duly delivered, but as we enter a new month U.S. politics is being consumed by very different questions and challenges.

President Donald Trump is warning Americans to brace for “a painful two weeks,” and scientists on a White House task force are projecting up to 240,000 people could die from the coronavirus outbreak. Biden is expressing doubts that this summer’s Democratic convention can go ahead.The spread of the virus into America is quickly reshaping daily life and shattering traditional election-year politics.

It’s wreaking havoc on the economy — which could be in recession when voters decide on Nov. 3 whether to give Trump a second term. Faced with the staggering death projections, Trump has largely abandoned the optimistic tone that characterized his virus response.

“Our strength will be tested, our endurance will be tried,” he said.

There's a further issue for the president as April shapes up to be a calamitous month for the oil market. Trump said the U.S. would meet with Saudi Arabia and Russia to try to stanch a plunge in prices.

The world Trump is navigating today is one that would have been unrecognizable to most Americans just weeks ago. These events will influence voters’ decisions, though for now it's impossible to know how.

Global Headlines

On hold | Saudi Arabia asked Muslims to defer plans to perform the obligatory annual Hajj pilgrimage as it grapples with the virus. Halting the Hajj, which attracts millions to Islam’s birthplace, would be unprecedented in recent history.

China reported 130 new asymptomatic cases in one day, hours after New York City’s death toll topped 1,000. Spain reported 864 new fatalities from the virus, a slight rise from yesterday. Brazilian President Jair Bolsonaro shifted gears last night on his relaxed virus approach, saying his main concern “was always to save lives.” Asia’s factory activity contracted further in March as the virus crippled supply chains. In China, though, a private survey showed an improvement in manufacturing.

Oil impact | Trump’s phone call this week to President Vladimir Putin as part of efforts to end the oil war between Russia and Saudi Arabia is being seen by Moscow as a diplomatic win. The view is the U.S. move may strengthen Putin’s hand in negotiating a climb down. Russia isn’t yet holding talks with Riyadh but hasn’t ruled them out, an official says, adding Moscow won’t boost crude output now given oversupply in the market. 

Saudi Arabia faces deep budget cuts due to the double hit from the virus and plummeting crude prices.

Losing points | As the virus sweeps Europe, leaders are turning to China for testing kits — but some are already expressing buyers' remorse. As Andrea Dudik and Radoslav Tomek report, complaints about inaccurate results from the kits could dent China’s efforts to win favor with a region where it has sought for years to build economic and strategic ties.Merkel’s moment | After more than 14 years in office, German Chancellor Angela Merkel is having a good crisis: Polls show surging support for her party and widespread public approval of her policies to combat the virus. Yet as Alan Crawford writes, history may judge her less on her custody of Europe’s biggest economy than on what she does to help the region’s weakest member states through a public-health disaster unparalleled in peacetime.

New bond | A firm friendship between Abu Dhabi’s crown prince and Indonesian President Joko Widodo has put the United Arab Emirates in pole position as Widodo seeks investors for an ambitious $400 billion infrastructure program. As Sylvia Westall and Philip J. Heijmans write, Mohammed bin Zayed Al Nahyan is looking to expand his country’s presence in fast-growing Asian markets, but there are also potential strategic outcomes from their rapport.

What to Watch

Ethiopia has postponed general elections scheduled for August, becoming the first African country to suspend a nationwide vote due to the pandemic. Trump approved a business-backed proposal to delay payment of certain tariffs by three months and could sign an executive order as soon as this week, Jenny Leonard reports. The White House won't reopen the Obamacare exchanges to let uninsured Americans buy health care coverage during the pandemic, after Trump said last week he was considering a special enrollment period.

Tell us how we’re doing or what we’re missing at balancepower@bloomberg.net.

And finally ... While health-care providers in the U.S. and Europe struggle to deal with the influx of Covid-19 patients, they’re also grappling with ransomware attacks. As Ryan Gallagher reports, hackers are seeking to exploit the crisis when medical providers are at their most desperate. “They are totally without conscience,” said Malcolm Boyce, manager director at Hammersmith Medicines Research in London.

 

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