POLITICO NIGHTLY: Biden gets the jobs report he wanted

View in browser   BY BEN WHITE With help from Alexander Ward Welcome to the weirdest economy ever — In a chat with economics reporters on Thursday afternoon, a senior White House official previewed today’s jobs report by essentially acknowledging what everyone already knew: The administration wanted a strong but not super strong employment report for June. “Even something below consensus would still suggest a strong labor market,” the official said, adding that a figure in the 200,000 range “would be very reassuring.” Ordinarily, you’d expect any sitting president and his staff to root for the biggest, splashiest, most awesome jobs numbers they could get. Especially a president with approval ratings as dismal as Joe Biden’s, both overall and on the economy. But these are weird economic times. And the biggest White House fears center on rampant inflation that is both emiserating consumers and pushing the Federal Reserve to quickly raise interest rates to cool the economy and tame price hikes. A giant jobs number today might have goaded the Fed into even faster hikes that could easily trigger an incumbent-crushing recession. In the event, the June number came in a bit hotter than expected at 372,000, barely below May’s quite strong 384,000. But it wasn’t so scalding that it upset markets worried that something over 400,000 or so would tip the Fed into panic mode about the labor market being way too hot. It wasn’t quite the cliched “goldilocks” figure — not too hot, not too cold — but it was close. Unemployment remained at 3.6 percent and wage gains continued to moderate. The labor force shrunk a bit, which was the biggest bummer in the report. But overall, it was pretty much exactly what the White House wanted to see.  Biden can continue to tout the numbers, which he did again today, calling this “the fastest and strongest jobs recovery in American history” (which is true but largely the result of an inevitable snap back from the 22 million jobs temporarily vaporized by Covid). And the president and senior White House staff can worry a little less that Federal Reserve Chair Jerome Powell will stomp on the brakes any harder than already expected (another three-quarter-point hike later this month and some more half-point hikes after that). But the report also added to a deeply strange — in fact unprecedented — economic picture. By some measures, notably job gains and the unemployment rate, the economy looks fantastic. By others, including overall gross domestic product growth, consumer and business sentiment and public polling on the issue, it looks like we are already in a recession. “GDP: -1% (assuming GDP Now is correct, a big assumption) … Employment: +2%. We have never seen a disconnect like that before in the data (available since 1948),” Jason Furman, a former top economic aide to President Barack Obama, tweeted about the numbers. It’s a near lock that we are about to see two straight quarters of a shrinking U.S. economy, ordinarily the demarcation of recession. But whether or not any period in U.S. economic history is officially deemed a bona fide recession is determined after the fact by the National Bureau of Economic Research. And consensus among top economists is that our strange current era cannot qualify as recession by NBER standards given the employment numbers. But everyone still hates this economy . That’s largely a product of soaring gas, food and other prices. But it’s also part of a broader American post-Covid funk and the result of bitter partisanship on guns, abortion and pretty much everything else. The good news (certainly for Democrats and possibly for America) is that today’s jobs report eases rising fears of a big-time slowdown.  “An American economy in free fall does not tend to produce 372,000 jobs in any given month,” wrote Joe Bruselas, chief economist at advisory firm RSM US, in a client note today. As for inflation? Some signs suggest it’s peaked. But let’s wait on that one until the latest on consumer prices hits theaters next week. Welcome to POLITICO Nightly. Reach out with news, tips and ideas at nightly@politico.com. Or contact tonight’s author at bwhite@politico.com or on Twitter at @morningmoneyben.   DON'T MISS DIGITAL FUTURE DAILY - OUR TECHNOLOGY NEWSLETTER, RE-IMAGINED:  Technology is always evolving, and our new tech-obsessed newsletter is too! Digital Future Daily unlocks the most important stories determining the future of technology, from Washington to Silicon Valley and innovation power centers around the world. Readers get an in-depth look at how the next wave of tech will reshape civic and political life, including activism, fundraising, lobbying and legislating. Go inside the minds of the biggest tech players, policymakers and regulators to learn how their decisions affect our lives. Don't miss out, subscribe today.     WHAT'D I MISS? — Biden signs abortion rights executive order amid pressure: Biden signed an executive order today directing his health department to expand access to abortion pills, beef up enforcement of Obamacare’s birth control coverage mandate and stand up an army of pro bono lawyers to help defend people criminally charged for seeking or providing the procedure. Biden stressed that none of the measures would fully restore abortion rights and that the solution is at the ballot box in November. — Inside the religious right’s efforts to wine and dine Supreme Court justices: The former leader of a religious right organization said he recruited and coached wealthy volunteers including a prominent Dayton, Ohio, evangelical couple to wine, dine and entertain conservative Supreme Court justices while pushing conservative positions on abortion, homosexuality, gun restrictions and other issues. The goal: to create an ecosystem of support for conservative justices, as a way of making them more forthright in their views. — Elon Musk terminates Twitter deal: Musk officially terminated a $44 billion deal to buy Twitter today, according to a filing from the SEC. A letter sent by Skadden Arps attorney Mike Ringler on the tech billionaire’s behalf alleged Twitter was in “material breach” of “multiple provisions” of the initial agreement. It also alleged the company made “false and misleading representations” about the deal. Twitter said it will sue Musk to complete the merger and is “confident” it will prevail, the Associated Press reported. — Judge lifts order against Indiana abortion procedure ban: U.S. District Judge Sarah Evans Barker’s order signed today lifts the injunction she issued in 2019 blocking the law against a second-trimester abortion procedure that the Republican-backed legislation called “dismemberment abortion.” The law prohibits doctors from performing dilation and evacuation abortions unless to prevent serious health risk or save the life of the mother. A doctor violating the law could face a felony charge, punishable by up to six years in prison. — Pat Cipollone meets for over 8 hours with Jan. 6 committee: The former White House counsel emerged today without commenting on his cooperation. Cipollone sat for an informal interview with the panel in April, though he had resisted previous calls from the select panel to testify. He reached an agreement earlier this week with investigators to sit for a transcribed interview. His testimony could be a crucial source of firsthand information about Trump’s effort to subvert the 2020 election. — Oath Keepers leader offers Jan. 6 testimony — but only if it’s live: Stewart Rhodes says he will waive his Fifth Amendment rights and testify to the Jan. 6 select committee if they permit him to testify in person at the Capitol complex. “He wants to confront them,” according to Rhodes’ attorney James Bright. But the panel has so far not agreed to other witnesses’ demands for live testimony without first appearing for a taped deposition. — Wisconsin Supreme Court disallows absentee ballot drop boxes: Absentee ballot drop boxes may be placed only in election offices and no one other than the voter can return a ballot in person, according to today’s ruling, dealing a defeat to Democrats who said the decision would make it harder to vote in the battleground state. After former President Donald Trump lost the state in 2020, he and Republicans alleged that drop boxes facilitated cheating, but offered no evidence. AROUND THE WORLD People pray at a site outside of Yamato-Saidaiji Station where Japan’s former Prime Minister Shinzo Abe was shot earlier today during an election in Nara, Japan. | Yuichi Yamazaki/Getty Images A SHOCK IN JAPAN — The world is in disbelief after former Japanese Prime Minister Shinzo Abe was shot and killed while delivering a campaign speech in the western city of Nara. As Biden and other global leaders send their condolences, Nightly asked national security reporter Alexander Ward to break down what this means for Japan — and the U.S. This conversation has been edited. How has Japan responded to Abe’s assassination?  With a massive outpouring of grief. Abe was popular with many, which gave him such a mandate to change the economic and foreign policy trajectories of Japan. But beyond that, such political violence — and violence in general — is rare in Japan. That this happened at all has caused immense shock and sadness. That it happened to Abe of all people only compounds that. How would you describe his legacy? Abe was, and will remain, a towering figure in Japan. As the country’s longest-serving prime minister, he bent economic and foreign policy to his will. His legacy will persist in the words “free and open Indo-Pacific,” a concept that rallied the world’s democracies to bolster their regional defenses with the aim of countering China. He turned apacifist nation constitutionally mandated to focus on self-defense into a global force, pioneering the idea of the Quad and hewing ever closer to the United States. What was Abe’s relationship like with the United States?  Abe is a key reason why the recent U.S.-Japan relationship is so bipartisan and strong. He was the first Japanese prime minister to give an address to a joint session of Congress and helped unite Pacific nations against China’s aggression. He will remain a key figure in modern Japanese history and also one in the history of America’s decades-long relationship with Japan.   Magnifying the Innovation Need – July 21 Event : We’re teaming up with MeriTalk for the inaugural MerITocracy 2022: American Innovation Forum, which will feature bipartisan Congressional and agency leaders and technology’s leading edge of thinkers. Join America’s most innovative minds as we look under the magnifying glass to examine some of the largest and most enduring problems around policy and technology. Save your seat by clicking here.     NIGHTLY NUMBER 250,000 The number of Venezuelans currently ineligible for Temporary Protected Status because they arrived in the U.S. after the March 2021 cutoff. A group of 22 Democratic senators in a letter today pressed Secretary of State Antony Blinken and DHS Secretary Alejandro Mayorkas to expand the protections to include more recently-arrived Venezuelans — and extend them past September — before the Monday deadline. PARTING WORDS Politico illustration / AP Photo STEWART 2024 — Biden should run for president in 2024, but if he decides against it for whatever reason, and the Democrats want a serious shot at retaining the White House, Jon Stewart should run on the Democratic ticket instead, writes Juleanna Glover. Yes, that’s right: Jon Stewart, the TV personality, podcaster, comedian. The 5’ 7” former host of The Daily Show. To get the “seriousness” question out of the way right off the top: Stewart’s definition of being an entertainer has him wrestling with the kind of big, serious topics that actual politicians specialize in avoiding. He spends his time recording an AppleTV show and podcast interview show on policy issues such as abortion, climate change, gun control, misinformation, modern monetary theory and other wonky-current topics, with the occasional Judd Apatow and Mark Cuban appearance thrown in for gloss. So he’s clearly engaged enough for the job. But the bigger reason is that he’s a better fit than most politicians for what modern politics has become. Did someone forward this email to you? Sign up here.  CLARIFICATION: Tuesday's edition of Nightly has been updated to clarify that Illinois periodically saw lower positivity rates of Covid-19 cases than surrounding states.   Follow us on Twitter Myah Ward @myahward Naomi Andu @naomiandu   FOLLOW US

POLITICO, LLC 1000 Wilson Blvd. Arlington, VA, 22209, USA